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Amazon's share falls as high street becomes prime contender

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 For the first time in four years, e-commerce giant Amazon has lost market share to high street stores in the non-digital entertainment category. 

According to the latest figures from Kantar Worldpanel, in the three months to 27 September, Amazon’s share slipped by 1.2% to 20.4%. 

Fiona Keenan, Strategic Insight Director at Kantar, said that it was likely that Amazon had only been gaining market share before Kantar’s records began in 2011. It remains the UK’s biggest seller of CD’s, games and DVDs, but high street retailers HMV, GAME and Argos have rcently done bigger and better. 

“The high street is still very important in entertainment and in this quarter there was a big game release and that’s when physical stores get the opportunity to create a lot of theatre which is particularly suited to games,” Keenan said. 

The “big game release” was FIFA 16, which had a definite impact on the physical market. Physical games had seen an 8% decline in total sales, including via the internet. 

“This strong performance has been led by the games market in particular, where high street spend grew by 7% in the past quarter,” Keenan continued. 

Keenan added that with highly anticipated games such as Fallout 4 and Star Wars Battlefront to be released this quarter, it is likely that the games market will continue to do well. 

During the period, 68.4% of physical entertainment sales came through high street stores, an increase 3.8% from the same period last year. It is also the highest figure since May 2014, when sales were bolstered by the release of large film releases such as Frozen. 

Kantar’s figures do not take into account digital music, g ames or films, and so services such as Amazon Prime were not considered. Keenan said that Amazon’s DVD sales may have been harmed by the focus on Amazon prime, but that “this could be something Amazon is consciously doing.” 

As the physical market overall shrinks in favour of digital services, it is likely that Amazon will remain on top of the entertainment market as a whole. 

Other e-tailers such as Play, Tesco and Asda also saw their gains decrease during the period. HMV was the period’s best performer, increasing its share by 2.5% on the back of successful multi-buy campaigns.  

HMV was also one of the many retailers that enjoyed the recent revival of sales in vinyl records, though Kantar figures did not take this market into account.

Published on Monday 02 November by Philip Gallagher

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