CNBC reports that so far this year, at least in part because of tariffs, Amazon has raised prices 12.8 percent, while Walmart has raised prices 5.3 percent and Target’s increases have been 5.5 percent.
According to the story, “Price increases are common for retailers trying to blunt higher costs from tariffs. Companies including Walmart and Target have said they are employing a portfolio approach to pricing following the tariff hikes, meaning they have raised prices on some items but not others.
“But the companies rarely detail how much they’re increasing prices or on what items.”
The research comes from a company called DataWeave, which “reviewed roughly 16,000 items each on Amazon’s, Walmart’s and Target’s websites to conduct its analysis. The firm says it continuously collects publicly available data and captures live product and pricing information. Its data spans categories, locations and time periods, according to DataWeave’s methodology.”
CNBC writes that “while each of the three retailers increased prices throughout the year, the sharpest increase came from Amazon between January and February, when prices on the surveyed SKUs — a retail industry term meaning stock keeping units — rose 3.7%, according to DataWeave’s analysis.
“That jump actually came ahead of the majority of President Donald Trump’s tariffs, announced in April, and could be the result of price normalization and a pullback in discounts after the 2024 holiday selling season, DataWeave found. However, Target and Walmart increased prices by an average of 0.97% and 0.85%, respectively, during the same time frame.”
KC’s View:
I have to wonder if one of the reasons that Amazon had more increases is that it is more dependent on its third-party marketplace, where it is not controlling prices to the same degree that it can for its own retails.
This also may reflect the fact that profitability has become more important to Amazon, especially as it pays more attention to the investor class.
Still, I’ve always believed that Amazon is not a price play – it is a convenience play, making it easier for people to buy stuff, even if the prices are slightly higher. The difference these days is that Amazon is more aggressive about selling.
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