Amazon (NASDAQ:AMZN) has risen to dominate online retail in large part because of its reputation for low prices. However, though the company does offer low prices on some items, it also relies on that reputation to charge higher prices on less competitive products. Holiday shoppers shouldn't automatically assume that Amazon has the lowest prices on everything, especially when they can easily use price comparison tools to avoid getting ripped off.
While Amazon works well for goods under $10, hard-to-find products, and media such as books, there are better options for other gifts. Below are five gifts you should avoid buying on Amazon this holiday season.
Electronics are one of the most popular products to buy on Amazon. The site's reviews give users helpful information on individual items, and unlike categories like clothes or furniture, there's little need to "try before you buy" in a store. However, holiday shoppers may want to consider looking elsewhere for electronics as Amazon often does not have the lowest prices. For instance, when I checked, a Fitbit Charge 2 was going for $99.99 on Amazon, but selling for just $62.99 on Bonanza. Similarly, a Playstation 4 was $299.99 on Amazon, but $14 less on eBay.
If you don't need your gift in two days or less, it may be easy to find a cheaper option elsewhere.
2. Power tools
Amazon is popular with shoppers in part because it sells hundreds of millions of items, but that range makes Amazon a poor choice when you're looking for a specialty product like a power tool. For something like that, you're better off shopping at a home-improvement retailer like Home Depot or Lowe's. You'll generally find a wider selection and lower prices from such retailers, as well as advice and expertise from in-store associates.
For instance, a Makita hammer drill combo kit sells for $235 at Home Depot, while the same set was listed at $310 on Amazon.
Like electronics and power tools, big-ticket items like appliances aren't the best things to buy on Amazon. Heavy competition among retailers like Sears Holdings, J.C. Penney, Home Depot, and Lowe's means shoppers should be able to find better deals on appliances outside of Amazon. With Sears' ongoing bankruptcy proceedings, it's also a good time for shoppers to look for liquidation sales at Sears stores.
You may also be able to find coupons for such retailers online, or from partners like Retailmenot. Shopping in stores for large appliances can help you get valuable information on size and functionality that isn't available online, and you can sometimes negotiate for a discount on things like a washer or dryer.
Small appliances can also be found cheaper elsewhere; a KitchenAid mixer was listed at $300 on Amazon but just $220 at Target.
Buying clothes online is enough of a crapshoot when doing it for yourself, but doubly so when you're shopping for someone else. You can't assess fit or quality until the product arrives at your door and if you need to exchange the product for one in another size, you can't do that on your lunch hour, as you could with a department store purchase.
Also, brand-name clothing can often found on sale from competitors, or cheaper directly from the manufacturer. A pair of Nike Portmore skateboarding shoes, for example, was $75.65 on Amazon, but just $49 on Nike.com. As with appliances, it's worth searching online for coupons, sales, and discounts from partner sites.
Jewelry is a popular holiday gift, but if you're looking for a bracelet or a necklace, you're better off visiting a specialty store where you can examine the merchandise, compare different options up close, and have a jeweler answer questions. Additionally, third-party sellers on Amazon may be selling counterfeit stones, and there is no easy way to verify the quality of what you're buying the way you can with a specialty online seller like Blue Nile.
If you're looking for something more affordable or artisan-made, you're better off shopping on Etsy, which has a much wider selection than Amazon's competing platform, Amazon Handmade, and you're therefore more likely to find an item that suits your tastes there. Etsy has defended itself well against the threat from Amazon and the holidays could give its sellers a big boost.
Amazon is a great choice for holiday shoppers, especially Prime members, who are in a time crunch or like the convenience of free, easy returns when they're needed, but for certain categories, it's best to look elsewhere first -- or at least comparison shop. For many of the gifts you're buying this holiday, you can likely find them someplace else for less.
John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Jeremy Bowman owns shares of Amazon and J.C. Penney. The Motley Fool owns shares of and recommends Amazon and Fitbit. The Motley Fool has the following options: short February 2019 $185 calls on Home Depot and long January 2020 $110 calls on Home Depot. The Motley Fool recommends eBay, Home Depot, and Lowe's. The Motley Fool has a disclosure policy.