How Wayfair Stole Traffic Away from Amazon (If Only for a Day)
While many online retailers consider Amazon untouchable, due to its enormous inventory and impossible-to-beat pricing, it would seem that this isn’t the case.
Recently, a David shook up the Goliath, if only for a day. Wayfair, a home furnishings ecommerce store, held its Way Day on April 25. Similar to Amazon Prime Day, the retailer had a day of drastically-reduced pricing on all products.
This strategy, it seems, paid off.
Digging into the Data
Thanks to heavy promotion, Way Day brought Wayfair’s website a 70% bump in traffic on April 25, as compared to the previous Wednesday. The eCommerce store saw a 336% increase in conversions on Way Day, too.
Among 24 other leading eCommerce sites (including Amazon, etsy.com, walmart.com and homedepot.com), rates were flat. Comparing total traffic for the the week beginning April 16 to the Week Beginning April 23, non-Wayfair sites saw 0.5% less traffic in the week containing Way Day and 0.05% fewer purchases. The same time period saw 11.1% more visits and 70% more conversions for Wayfair.
While the site saw significant sales in all categories, the Home Décor category saw the biggest boost (a 20% increase) in purchases compared to other sites’ Home Décor categories like Amazon, Walmart, and Kohls.
Making the Competitors Sweat
Don’t think that Amazon (and Walmart) missed the impact of Way Day. While Wayfair’s traffic and sales went up, traffic declined for the competitors. In the Home Décor category, Wayfair’s share of conversions bumped to 25% and 28% the day of and day after Way Day; usually, their share hovers between 5% and 10%.
And this wasn’t simply an effect of more purchases for Wayfair overall. Often, shoppers visit Wayfair as well as Amazon or Walmart when shopping for home Décor. The data shows that during the week of Way Day, there were fewer shoppers for products in the Home Décor category that visited other ecommerce sites in addition to Wayfair, indicating that they’d found what they needed there.
What Wayfair Gets Out of All of This
While sales have evened out on Wayfair since Way Day, they are still elevated. The day after Way Day, 9% more unique visitors came to the site and the site saw 211% more conversions.
Something interesting to note is that Wayfair drives 94% of its Home Décor traffic organically, only generating 6% through paid search. Amazon, who usually generates mostly organic traffic, uses paid search for 33% of its Home Décor traffic. Walmart drives only 19% of its traffic organically, relying on paid search for 81% of its home Décor traffic.
All this is to say that Wayfair has done its job in carving out a niche for itself, with minimal paid online advertising.
Takeaways for Online Retailers
The big message here is: you don’t have to be Amazon to win sizeable market share, if only for a day. Emulate your own Prime Day; even if it’s a loss leader, there are long-term benefits, as Wayfair has proven.
But in order for your slashed-prices promotion to work, you must market it heavily to get the kind of attention necessary to drive results. Way Day worked because it was written up on dozens of high-profile websites (there were over 4 million results for a search on “Wayfair discount day.”)
Have a niche, the way Wayfair does with the Home Décor category. You’ll never beat Amazon on offering a wide variety of product categories, but if you focus on one, you have the potential to really dominate in it.