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July 16, 2015

Amazon Conversion Rates: Can Anyone Compete?

In the U.S. and beyond, Amazon is a seemingly unstoppable brand. The site provides consumers with access to literally hundreds of thousands of items with just a single click of a button.

As the most prominent US based online retailer, Amazon is constantly looking for new and innovative ways to supply customers with merchandise at incredible speeds, provide world-class customer support, and reach new heights in terms of conversions. And they just keep upping the ante.

Amazon’s Prime program is a large contributor to the company’s current success. With Prime, members are treated to free 2 business day shipping, movies and television shows through the company’s instant video service, digital music and e-books, and many other features and benefits. At a yearly price of $99, the list of perks is impressive, and the sign-up numbers are sky-high.

Despite Amazon currently holding the second place position in online retailers’ world-wide, with Alibaba in first, the massive digital merchant seeks to reclaim that throne in a big way. Shortly before the retail behemoth announced its plans to steal Black Friday’s thunder with Amazon Prime Day it was announced that the conversion rates made on the digital storefront are simply staggering in comparison to other North American competitors.

Millward Brown Digital, a website traffic measurement firm, recently conducted a study in which the conversion rates of businesses on the Internet Retailer Top 500 Guide were analyzed and compared to one another. The results showed that members of the Amazon Prime program, who were defined as those who interacted with Prime content or engaged in Prime features, convert an astonishing 74% of the time.

Compare that to the average conversion rate of the Top 500 merchants, 3.32%, and the numbers speak for themselves. Amazingly enough, even customers who are not Prime members still convert at a rate much higher than average. Nearly four times the average rate to be exact, converting 13% of the time.

Additionally, not only has Amazon achieved a conversion rate 22 times higher than the norm, the company is topping their own rates as well. Just since early April of this year, Amazon has managed to increase conversions 11%, from 63% to the aforementioned 74%.

When these same Prime members shop with retailers such as Wal-Mart or Target, they convert on average only 6% of the time.

And the bad news for other retailers doesn’t end there. Once an individual signs up for the Prime program, that person is far less likely to even consider purchasing from any other e-retailer. For instance, non-Prime members who begin a search on Amazon will also reference sites such as Walmart.com 12% of the time, whereas Prime members will only browse on Walmart.com 0.9% of the time.

For other retailers not as prominent as the Wal-Mart brand, things look even bleaker. For retailers such as Target.com, non-Prime members will consider this outlet approximately 8% of the time. For Prime members? Only 0.7% will consider this site an option.

To add further insult to injury for other retailers, the Macquarie investment firm predicted that by the year 2020 one half of U.S. households could be Prime members.

Currently, approximately 20 – 25%, of households in the United States, or about 40 million people, have already signed up for the Prime benefits, so these figures are completely feasible. While the investment firm’s report states that roughly 10 million consumers tested out Prime for the first time in the fourth quarter of 2014, the e-retailer stated in its most recent earnings report for the fourth quarter of 2014 that Prime memberships did in fact increase 53% last year, and 50% in the United States.

Amazon.com is without a doubt a force of nature when it comes to the online retail market. Their Prime loyalty program is one of the most prominently used by online shoppers today, and the reason why is crystal clear.

Not only is the site one of the most successful in history, but it also owns the largest online shoe retail on the planet, Zappos.com, along with many others. As Amazon celebrates this massive victory alongside their upcoming 20th birthday with Amazon Prime Day on July 15th, the already crushingly huge numbers the e-retailer has put on the board will only continue to skyrocket and propel the company to new heights.

Amazon clearly has its conversion tactics down to a science. For those of you who are still struggling, you may want to check out some other highly effective conversion strategies.

How do you think Amazon Prime Day will contribute to the already overwhelming numbers that Amazon is producing? Do you think that Amazon will once again reign supreme over Alibaba, or does the China-based retailer have a rebuttal up their sleeve?


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Digital producer, online marketer, community manager, and multi-faceted writer Tina Courtney-Brown has been managing cross-functional teams for online businesses since 1996. Tina has assisted many clients in maximizing online production and marketing efforts, and is a staff writer for SiteProNews, one of the Web’s foremost webmaster and tech news blogs. She’s produced and marketed innovative content for major players like Disney and JDate, as well as boutique startups galore, with fortes including social media, SEO, massively multiplayer games, community management, social networks, and project management. Tina is also a certified Reiki practitioner, herbalist, nonprofit director and spiritual counselor. Learn more at her personal website, or find her on Facebook and Google+.

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