Showrooming becomes fully digital: KitchenAid marketplace analysis

 In Behavioral Analysis, Case Studies, Consumer Behavior, conversion trends, E-commerce Marketing, Featured, Marketplace Report, Popular, Site Analysis, Top 10, Trends

‘Showrooming’ is when a consumer goes to a brick-and-mortar store to test a product, and then buys it online for a lower price. More accurately, they probably buy it on Amazon as the retail behemoth accounts for nearly one third of America’s online transactions. The online retailer took the concept of showrooming a step further when it launched Amazon Pages, a service for companies to create branded storefronts on the e-commerce platform.

It’s obvious why brands and retailers flock to the marketplace to leverage its vast audience and familiar purchase environment to sell their products. As the e-commerce giant expands its footprint to new markets, talk about the pros and cons of selling on Amazon have deepened. The conflict is mainly one of exposure versus perceived sales. By listing products on Amazon, sellers can substantially expand the reach of consumers exposed to their products and brand. However, there is also a risk that selling on third party marketplaces will decrease the inbound traffic to the brand’s own e-commerce website, where it’s typically more effective at converting casual visitors into paying customers.

This dilemma motivated us to analyze the traffic and sales of specific brands on Amazon in comparison to that of their own e-commerce sites, to assess if the benefits of selling on Amazon outweigh the potential risks. To do so, we chose a household name that has its own online store as well as a branded store on Amazon: KitchenAid. We found that although traffic to KitchenAid’s own site was 156 times that of the KitchenAid branded properties on Amazon, consumers bought the brand’s products on Amazon 30 times more than on its own e-commerce site. Read on for our full data-driven findings.

Amazon Pages vs. brand’s e-commerce websites

Nearly four years ago Amazon launched Amazon Pages, creating a new opportunity for brands to have a living presence within Amazon’s ecosystem. The advantages are obvious. Amazon is the leading destination for online purchases, with 304 million active customers worldwide, listing products on the online marketplace provides unparalleled reach, not to mention fosters immediate action due to the platform’s secure and trusted purchasing environment. But we all know that Amazon knows how to sell.

For years Amazon has been courting brands and has successfully lured thousands of brands and dozens of department store staples to sell directly on the marketplace, including Calvin Klein, Kate Spade, KitchenAid, Reebok and Levi Strauss. However, the benefits of these well known names having a branded environment on Amazon is less obvious. The risk of losing out on sales due to diminished inbound traffic to their e-commerce website, optimized towards their products and audience, is much more prominent.

We compared global traffic and conversion on KitchenAid’s Amazon Page to visits and purchases on the brand’s website in Q2 of 2016, to detect consumer preferences and online shopping trends. We found that on average, KitchenAid’s own site attracted 156 times the amount of visitors as its Amazon Page, but actual sales on Amazon were a staggering 30 times that of KitchenAid’s own online store.

The reason for this is threefold. First, our conversion data for revealed astonishingly low conversion rates, averaging at 0.05 percent. Secondly, Amazon’s marketplace structure is geared towards end products, sending consumers to relevant product pages rather than to the seller’s branded page. Third, KitchenAid’s site focuses on the brand’s high-end countertop appliances, which tend to be bought less often and at higher costs than attachments and accessories that can be easily found on Amazon.

Top ten KitchenAid products purchased on Amazon

There is a clear discrepancy between the amount of traffic KitchenAid’s site receives, and the completed conversions on Amazon. To dig deeper, we looked into the leading KitchenAid products purchased on Amazon, and found that they all had one thing in common: they were all attachments and accessories. In fact, a whopping 73 percent of the purchasers bought a stand mixer attachment.

# Product % of Top 10
1 Peeler and Slicer Attachment for Stand Mixers 16.4%
2 Edge Beater for Tilt-Head Stand Mixers 16%
3 Food Grinder Attachment for Stand Mixers 13.6%
4 Pizza Wheel 10.4%
5 Short Turner 9.3%
6 2 Quart Ice Cream Maker Attachment for Stand Mixers 8.4%
7 5-Speed Ultra Power Hand Mixer 7.3%
8 Sausage Stuffer for Stand Mixer Grinder Attachment 6.4%
9 1-Piece Pouring Shield Attachment for Stand Mixers 6.4%
10 Wire Whip Attachment for Tilt-Head Stand Mixers 5.6%

These top ten products account for 22 percent of the total KitchenAid products purchased on Amazon. The dominance of mixer attachment sales comes as no surprise, as the brand has been manufacturing stand mixers for nearly a century. Additionally, these type of products are cheaper and tend to be bought more often than the full blown appliances they connect to. As for the brand’s countertop appliance purchases on Amazon, we found that mixer and blender shopping activity was very minor, and accounted for just 8 percent of KitchenAid’s leading 200 products sold on Amazon.

Bottom line: Amazon has established itself as the shopping destination for consumers. Brands can’t ignore Amazon’s marketplace, but must weigh the potential benefits and risks. Based on our KitchenAid marketplace analysis, the brand would be wise to focus its Amazon selling initiatives on mixer attachments, and work on optimizing its website’s conversion flow to increase high-end product sales.

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