How Your E-Commerce Startup Can Compete With Amazon’s Low Prices

As Amazon continued to show in a rebound year in 2023, the eCommerce company is an absolute behemoth. But don’t let that power deter you or your e-commerce startup. You can still win.

After a difficult 2022 hampered by a general economic downturn and a decline in online consumer demand, Amazon stabilized its profitability and net income last year. Meanwhile, the company continues to innovate. Amazon is testing drone delivery systems in multiple countries, for example. The company is expanding use of artificial intelligence to provide insight on everything from product returns to customer feedback.

With more than 310 million customers worldwide, Amazon holds the crown as the top player in the e-commerce space, with almost 40% of the market share. Amazon’s low prices, two-day shipping and one-click shopping have made it the go-to place for online shoppers looking for a good deal. But if you’re an e-commerce startup, there are still ways to compete with Amazon’s low prices and win loyal customers

Here are six tips for staying in the game and scoring more sales as a startup e-commerce website. 

12 Keys to Choosing and Building Your Best Side Hustle Idea

1. Tap into your strengths

You can’t compete with Amazon on price alone. 

Unfortunately, as a small e-commerce website, you don’t have the brand recognition, the extensive catalog, vast delivery networks or low-cost operations like Amazon to help keep your prices down. 

Instead of trying to match Amazon’s prices, take advantage of your strengths. What are the things that set you apart from the competition? Is there something that makes your customers come back repeatedly?

Instead of trying to match Amazon’s prices, take advantage of your strengths.

You don’t have to lower your prices just because someone else does — you can set yourself apart by offering what they don’t have: a unique selection of products or a personalized experience.

Unique product offering

One way that startup e-commerce websites can succeed against big players like Amazon is by selling unique products. If you are selling products online, try to offer things that customers can’t purchase through Amazon. 

For example, an online store that sells video games and downloadable content (DLC), like a Fortnite Harley Quinn skin, will do well because big retailers can’t just rely on low prices.

(Image source)

In 2019, 87% of gamers purchased downloadable content. And the best part of all? Those DLC purchases didn’t come through Amazon.

The online gaming industry is expected to generate $26.29 billion in revenue by the end of 2022. This sector will grow rapidly at a CAGR of 6.46% between 2022 and 2026, resulting in a market value of $33.77 billion by 2026.

Find a growing industry and focus on products that are unique to the niche and that aren’t available on other websites. Selling products that Amazon doesn’t offer is a surefire way to score sales.

Personalized experience

Another way to compete with Amazon’s low prices is by offering a personalized service that surpasses the competition.

When it comes to personalization, e-commerce businesses are still not meeting customer expectations. Thirty-one percent of consumers want retailers to give them a more personalized shopping experience. And surprisingly, nearly half of online shoppers will go to Amazon if the site they are shopping on doesn’t offer relevant product suggestions.

A personalized shopping experience is necessary in this digital age. To add the cherry on top, consider investing in stellar customer service initiatives. 

But don’t stick to the infuriating methods of email and phone calls to your customers to get a hold of a customer service representative. Consider using a virtual receptionist or live chat feature to help one-up your customer service game with a more personalized approach.

According to Salesforce, 80% of customers agree that their experience with a company is just as important (if not more) than the products and services themselves. Don’t skip out on these initiatives to improve the user experience. You’ll gain a leg up on Amazon in no time. 

(Image source)

2. Offer free shipping

The next time you browse Amazon, you’ll notice that the items available for free shipping are the top-selling products on the site.

If you look at any other product without free shipping and compare it to one that does, chances are that it’ll be more expensive than its counterpart. Funny how that works.

The secret is simple: Free shipping makes customers feel special, and it allows them to receive their product quickly without having to spend any extra money on shipping costs or wait longer than expected for their order to arrive at home or work.

Seventy-three percent of customers are more likely to purchase items online that offer free shipping. And if more free shipping were available, 90% of consumers would shop online more often.

(Image source)

Free shipping is a simple way to reduce shopping cart abandonment and compete with Amazon Prime offerings. If you can offer free two-day shipping, that is even better.

However, there’s a catch: Offering free shipping does come with a cost — usually around $7-$10 for every item ordered online by consumers. If you’re not careful about how many products people buy from your e-commerce store, offering free shipping may become too expensive and you could lose money.

It’s essential to incorporate shipping rates into how you price your products, so you are still profitable.

3. Use precise wording in your title tags and product descriptions

The name of your product, the title tags and descriptions for your products, and the copy used in your ads are crucial to your success online.

Using precise wording in your title tags and product descriptions allows search engines to understand what the page is about when they crawl it and can then index it properly. In fact, keywords are the foundation of SEO.

For example, if you are selling a pair of jeans and want to attract more customers from search engines, you should include keywords like “high-waisted jeans” or “skinny jeans” in your product description. A person searching for jeans is likely looking at multiple sites with different prices and styles before making a purchase decision.

If you don’t use exact keywords in this section of your site (or any other area), then you risk losing potential sales to competitors who do. 

Verizon Digital Ready: Providing Entrepreneurs the Skills and Knowledge They Need

4. Post customer reviews, testimonials and photos to show off your products’ best features

It’s important to let people know what they’re getting when they buy from you. Don’t miss out on the opportunity to show off the best parts of your product using high-quality images. 

Pictures are worth a thousand words and can make or break a customer’s decision to purchase your product. 

Don’t use stock images. Instead, opt for taking original photos and using an image editing API to create a uniform look across all pictures. 

Show your product from all angles (front, back, side, etc.) and highlight the key features that make your product unique. 

People don’t just want to see what your product looks like — they also want to see how it fits into their lives. Suppose you are selling luxury watches for men. Show a picture of how it looks on a male model. These pictures offer a more realistic idea of your product’s appearance outside the studio lighting with a one-dimensional background. 

It works, as this MVMT watch is no longer in stock online.

(Image source)

In addition to high-quality images, you should include customer reviews and testimonials on your product pages. 

When customers see that other people have already tried and loved a product, they’re more likely to buy it themselves. Reviews help potential customers make an informed decision about if that product’s right for them.

Encourage customers to leave reviews by offering discounts on future purchases or gifts. This strategy will encourage current customers to keep coming back while also building valuable social proof for your products.

5. Make sure the ordering process on your website is as easy as possible

The user experience is the most important part of any company’s website. If visitors can’t easily find what they’re looking for, or if they get frustrated trying to navigate your site, they’ll likely leave and go elsewhere. And let’s be honest, they probably go right to Amazon. 

Here are a few key areas that can help keep your website user-friendly: 

  1. Design: Make sure your e-commerce website looks professional. First impressions are critical and can help avoid high bounce rates.
  2. Navigability: Add a search future so customers can easily find what they are looking for without having to click through multiple pages or search through a drop-down menu.
  3. Easy payment: Make sure you have an easy payment process so customers can check out quickly. Include multiple payment gateways such as credit card, Apple Pay, PayPal or even a buy now, pay later option.

Mobile-friendly: People are shopping more and more on their phones. Over 75% of smartphone users have purchased online using their mobile devices within the last six months.

Most Read: What Is the Average Income of a Subway Restaurant Franchise Owner?

6. Experiment with social selling

Social media is a great way to build up your reputation and get more people interested in buying from you.

Social selling involves using social media platforms like Facebook or Instagram to connect directly with your customers without having to go through any middlemen like Amazon. This allows them to interact with your brand in a more personal way than they would if they were browsing on Amazon.

Use social media platforms to build relationships with your customers, create an engaging, personal experience, and inspire viewers with high-quality images.

West Elm does an excellent job drawing in potential customers with aesthetically pleasing interior design ideas and allowing viewers to shop the exact look in the app itself. Social selling provides all the information consumers need right at their finger trips to make the purchase. 

(Image source)

You can also use social media to give them a sneak peek at what’s coming down the pipe, or offer exclusive deals or promotions that are only available through your company’s social media accounts.

This is a great way to get people excited about your company, but it also helps you stand out from other e-commerce sites. 

5 Ways E-Commerce Entrepreneurs Can Make More Data-Driven Decisions

Wrapping up

It turns out that it’s possible to compete with Amazon after all.

Forget about trying to win the price war. You can compete with Amazon by tapping into your strengths and offering a unique experience for your customers. Here are some ideas:

  • Offer free shipping on every order, no matter how small it is.
  • Use keywords in your title tags and product descriptions to improve your ranking on search engines.
  • Provide a personalized shopping experience and give social selling a try.
  • Don’t underestimate the power of high-quality images and customer reviews.

Fighting Amazon for market share is undoubtedly one of the hardest things about running a startup e-commerce website. While there is no easy one-size-fits-all solution, we hope this article has given you some helpful tips on how to stand out from the masses, drive traffic and increase sales while competing with Amazon’s low prices. 

Originally published in August 2022

Leave a Reply
Related Posts
Workers looking at documents in an office
Read More

How to Increase Sales with a Customer Satisfaction Analysis

For any business, customer satisfaction should be a priority. After all, your customer satisfaction levels directly impact customer loyalty, repeat purchases, brand reputation, and ultimately your overall success.    Satisfied customers will spread the word...
Read More

How to Start a Loyalty Program in 5 Easy Steps

One of the best ways to grow your startup business it to create a loyalty program. Rewards programs remain one of the most efficient methods for startups to reward existing customers and keep them coming...