How Best Buy Competes With Amazon On Price

The basic assumption in the retail marketplace is that traditional retailers that were built on brick-and-mortar models can't compete with Amazon on price.

Well, Best Buy is doing everything in its power to make sure it can. And a new study shows that Best Buy has not only closed the price gap between the two, but sometimes Best Buy's prices are actually lower. 

As reported by CIO, Wall Street analysts did a comparison of more than four dozen items listed by both Best Buy and Amazon and found that Best Buy is often on par with prices with the eCommerce giant. 

David Magee, an analyst who tracks Best Buy for SunTrust Robinson Humphrey, said he compared items like washers, dryers, TVs, computers, etc., and in most cases Best Buy prices weren't much different than Amazon.

"In the past, we've seen a gradual tightening of the spread between the two retailers. This time, the basket totals were essentially at parity," he wrote in a research note.

While Amazon's bread and butter has been its free shipping on purchases over $35, along with its Prime membership that costs $99 annually but comes with free two-day shipping on eligible products. Recently, Best Buy shrank the gap even more by matching the same deal and providing free shipping on purchases of $35 or more. Best Buy has also been testing curbside pickup and offers a buy online, pick up in store service

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