http://www.theinquirer.net/?article=22315
Strange price hikes hitting my Amazon.com cart
Inflation? Dynamic Pricing, or what?
By Fernando Cassia: Tuesday 05 April 2005, 03:24
IS THE web retailer giant Amazon.com hiking prices by 10% or more regularly? As someone who lives outside the United States, but regularly buys books and electronic goods from North America - most of the time on Amazon.com - I started noticing this worrying trend last December. Unfortunately I didn't do any screen captures back then, or I would have absolute proof of three recurrent hike alerts, month after month.
Could this be related to the US inflation fears that the economic press is currently drumming about? I'm not sure. I also thought that it might be a case of the web retailer simply hiking prices across the board on the users' shopping cart contents to improve their bottom line, but that sounded strange given the highly competitive nature of the retail marketplace in the U.S. and that the company actually warns users about the change.
Five years ago, a CNet story showed the web retailer's by-then-new marketing strategy dubbed dynamic discounts, which meant that some items would be offered with a special extra discount, but for random -or select- customers only. It ended up outraging many customers at the time. Maybe they're at it once again after everyone forgot of the original outrage?.
One thing is certain: what I noticed on my shopping cart is that they raised prices to many items on it at once and by about the same percentage. I can't claim that is the case for everyone, I can just narrate my personal experience: the price hikes seem to appear specially when you place items on your cart and leave them there for a couple weeks (amazon.com remembers your cart contents on the server side), until you return to the amazon.com page to complete the checkout process. Then, you see a warning message in red, alerting you in kind and polite terms of the price hike: "Please note that the price of [item name] has increased from [old price] to [new price] since you placed it in your Shopping Cart".
You might say "hey, what are you complaining for?, they are kind enough of letting you know of the change, while other web retailers are raising prices without telling anybody". Well, that is true, and I thank the company for the fair play. So, this article shouldn't be considered an Amazon.com bashing exercise, just an attempt at collective thinking. I'm curious -and puzzled, and worried- since I've seen these warning notices about price hikes three times, and for different items added on different months, since last December. This would indicate that there were recurrent price hikes the last three months -in other words, it's not the same warning displayed three times.
The price differences on some items in the last "hike" are at around 12%, not a small increase by any means; case in point: a Portable DVD player going from $159 to $179. And these hikes seem to affect even low-cost, non electronic items: a music DVD going from $15.98 to $17.98, and one HP toner cartridge from $56 to $64.
So when when I noticed this phenomenon the last time, I decided to take some screen shots, which I added to the one I took originally in February. By the way, when you see two notebooks in there, don't think I'm not purchasing notebooks all the time -even while I'd love being able to-, I just add kit that interests me (or which I would LIKE to buy one day) to keep an eye on price drops. Lately, however, I see mostly price hikes. In a rare case of price stability, the price of the Philips' Home Defibrillator hasn't changed since I wrote about it in October 2004.
I will let you see for yourself and be the judge:
February 14, 2005: a couple DVD Movies, an Averatec notebook, and a DVD player in my shopping cart. All show the price hike warning message. However, for some strange reason, the new price is not shown in the warning.
April the 1st, 2005: Amazon.com warns of hikes on a toner cartridge, a music CD, a different notebook, and an audio CD.
If you buy regularly from Amazon.com, what is your experience?. Do you think these price hikes are due to Amazon.com trying to improve their bottom line? Are they using 'Dynamic pricing' schemes once again?, are we the lazy buyers punished for not engaging in 'impulse buying'? or is it due to the macro economic conditions of price inflation in the United States? Before you say "fuel and shipping", let me point out at the defibrillator, at the same price now as it was nearly six months ago. Since I'm a fan of Jeff Bezos' company and a regular shopper, I'd like to know what you think. µ