Sounds like a solution looking for a problem to me.
For all of this complexity, Amazon rarely has a significant price advantage versus most retail stores.
From a customer point of view, competitive categories have a flea market quality to them. For a company that is usually optimized for customer experience, this is a weird science experiment.
IMO, they should make price adjustments less fluid. Require merchants to get to the lowest price as soon as possible, and punish stupid resellers that throw up divergent high/low prices by forcing them to live with it.
I suspect (here as with the earlier story about imposter goods on Amazon) that the explanation for Amazon's behavior is that it doesn't have the resources to moderate the system its created. Disallowing price adjustments altogether wouldn't work for many categories- sometimes the price of milk just does go up, and retailers can't always just eat the difference. Disallowing only manipulative price adjustments would require either a sophisticated AI (which would be liable to fail in perverse-looking ways) or an expensive team of human analysts (which would at least only fail in plausible-looking ways.) But until these sorts of issues really start effecting Amazon's bottom line, its not going to touch them.
The issue is that there is no such thing as "the lowest price", it depends on supply and demand, and either can fluctuate drastically in short periods of time (i.e. surge pricing for uber). The manipulations the article mentions, that exist in all markets, are very rare.
Once upon a time I worked at an ebook company. We were naively trying to compete with Amazon (i.e. we sold every book we could get our hands on).
Sometimes we'd negotiate a deal with a publisher, and slash the price of a book to a point where no one involved in the transaction was making money, sometimes we and the publisher would be losing money... Without fail within an hour the list price of the content on Amazon would be exactly what we set.
Amazon were/are prepared to eat the loss: I suspect this is the case for all products that are sold by Amazon. It was a very effective strategy for them. My company went into administration after just 9 months.
I once read the account of a student who gamed the bots sellers use to competitively price their products in order to get cheap textbooks.
The person made a dummy seller account, setup a bot, and listed the books they needed. As they lowered their listing prices, the real sellers' bots auto-price matched.
The student then bought all their books at ~1/10th the original price, canceled any orders they may have received, and deleted their store.
A friend of mine once claimed that Amazon could sell at cost and still profit - they'd charge the customer for an item immediately, but have 30 or 60 days until they had to pay the supplier, so the interest on the payment in the meantime was profit. Not a lot on a $15 collection of toilet paper (for example), but multiple by the number of Amazon customers...
Of course, that skips the costs of Amazon staffing and infrastructure, and I'm sure Amazon sells most items above cost (and potentially some below), but I took it as a good example of how the scale involved meant that few can compete with Amazon.
I've used several repricers, it's a must when selling competitive products with a large numbers of skus.
One thing I'll note is that there's up to a 15 minute delay before a price change takes effect.
Also, Amazon will often "suppress" the buy box if no sellers have a good price. You can still buy, but there's an extra step needed. "Other sellers", then add to cart.
I don't see what's so special about continuously updating your price as a seller. This happens in pretty much every grocery market in the Middle East or Eastern Europe.
I also don't understand how the supposedly fierce competition between sellers ends up yielding prices that are higher than offline stores. Seems the reporter missed the true story.
What places do you have in mind talking about Eastern Europe? "Grocery market" for 99 % of people (from Eastern Europe) is a "shop"/supermarket/mall (think of Lidl, Tesco or Carrefour as examples) and even outdoor markets, if they exist at all, usually have set prices (which may change during the day, of course).
It's quite likely that many sellers don't actually have the stock they claim to have and relies on getting them elsewhere in case a large order comes through, which incurs an overhead. My experience in online retail is limited to electronics but this kind of inventory inflation is extremely common.
It's interesting to know that products on Amazon might not be the lowest price, or always close. I thought there was more manual price research and setting, like Walmart.
Walmart can't change their prices as fast; humans have to re-label things. For now.
Brick and mortar retailers can use radio-controlled e-ink shelf price tags for minute by minute price changes.[1] This hasn't really caught on yet, but the technology is ready.
I've actually started switching grocery buying to walmart - because they do have the best price, and they have free shipping.
With Amazon it's annoying - I have to keep items in the cart for a while to see how the price ends up. That's worth it for expensive electronics, but not groceries.
Sorry for the off-topic, but why is this available free on Morning Star, and paid-for on WSJ? Don't assume Morning Star is ripping WSJ, so is the pay wall a lie (for this (sort of) article)?
It would be nice if HN would make a change to their link submission code so that it automatically changes WSJ URLs to use the Facebook redirect workaround, since they are the one major site that disabled the Google workaround.
But until then we have to do it this way.
Off-topic: Am I the only who can never load the comments on WSJ articles? This is across browsers (Firefox/Chrome) and platforms (Windows/Mac/iOS), and even with adblockers turned off. This article says it has 36 comments, so it must be working for most, but I can't seem to figure out why it never works for me.
This is a very unfortunate trend where sellers are selling not based on the value of the item/service, but demand/need of the consumer. It has been a common practice in airline industry, and upto some extent in healthcare. But now this practice is creeping into online shopping too. This can soon fall into unethical territory. Imagine an item, that costs $1. Just because it could be life-saving for someone, or someone needs it badly, you sell it at much higher premium. You are not charging for your service, but exploiting other people need.
[+] [-] Spooky23|9 years ago|reply
For all of this complexity, Amazon rarely has a significant price advantage versus most retail stores.
From a customer point of view, competitive categories have a flea market quality to them. For a company that is usually optimized for customer experience, this is a weird science experiment.
IMO, they should make price adjustments less fluid. Require merchants to get to the lowest price as soon as possible, and punish stupid resellers that throw up divergent high/low prices by forcing them to live with it.
[+] [-] maxander|9 years ago|reply
[+] [-] thinkloop|9 years ago|reply
[+] [-] unknown|9 years ago|reply
[deleted]
[+] [-] rahilb|9 years ago|reply
Sometimes we'd negotiate a deal with a publisher, and slash the price of a book to a point where no one involved in the transaction was making money, sometimes we and the publisher would be losing money... Without fail within an hour the list price of the content on Amazon would be exactly what we set.
Amazon were/are prepared to eat the loss: I suspect this is the case for all products that are sold by Amazon. It was a very effective strategy for them. My company went into administration after just 9 months.
[+] [-] ortusdux|9 years ago|reply
[+] [-] ergothus|9 years ago|reply
Of course, that skips the costs of Amazon staffing and infrastructure, and I'm sure Amazon sells most items above cost (and potentially some below), but I took it as a good example of how the scale involved meant that few can compete with Amazon.
[+] [-] ikeboy|9 years ago|reply
One thing I'll note is that there's up to a 15 minute delay before a price change takes effect.
Also, Amazon will often "suppress" the buy box if no sellers have a good price. You can still buy, but there's an extra step needed. "Other sellers", then add to cart.
[+] [-] KKKKkkkk1|9 years ago|reply
I also don't understand how the supposedly fierce competition between sellers ends up yielding prices that are higher than offline stores. Seems the reporter missed the true story.
[+] [-] michalskop|9 years ago|reply
[+] [-] tedunangst|9 years ago|reply
[+] [-] Laforet|9 years ago|reply
Apparently book sellers do this as well.
http://www.michaeleisen.org/blog/?p=358
[+] [-] mirimir|9 years ago|reply
https://news.ycombinator.com/item?id=10289742
[+] [-] thinkloop|9 years ago|reply
[+] [-] Animats|9 years ago|reply
Brick and mortar retailers can use radio-controlled e-ink shelf price tags for minute by minute price changes.[1] This hasn't really caught on yet, but the technology is ready.
[1] http://www.eink.com/esl_tags.html
[+] [-] ars|9 years ago|reply
With Amazon it's annoying - I have to keep items in the cart for a while to see how the price ends up. That's worth it for expensive electronics, but not groceries.
[+] [-] whyenot|9 years ago|reply
http://news.morningstar.com/all/dow-jones/us-markets/2017032...
[+] [-] SEJeff|9 years ago|reply
[+] [-] sverhagen|9 years ago|reply
[+] [-] mcnaughtonrules|9 years ago|reply
[+] [-] downandout|9 years ago|reply
https://m.facebook.com/l.php?u=https%3A%2F%2Fwww.wsj.com%2Fa...
If you want a draggable bookmarklet that will bypass the paywall for all WSJ articles, go here:
http://salzeko.com/wsj/
It would be nice if HN would make a change to their link submission code so that it automatically changes WSJ URLs to use the Facebook redirect workaround, since they are the one major site that disabled the Google workaround. But until then we have to do it this way.
[+] [-] jrullman|9 years ago|reply
[+] [-] TheSpiceIsLife|9 years ago|reply
[+] [-] berberous|9 years ago|reply
[+] [-] pirocks|9 years ago|reply
[+] [-] QuadraticFizz|9 years ago|reply
[+] [-] jeron|9 years ago|reply
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[+] [-] israrkhan|9 years ago|reply
[+] [-] bognition|9 years ago|reply
[+] [-] an_account|9 years ago|reply
[+] [-] refurb|9 years ago|reply