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Amazon Refunding The Overcharge Experiment
MDMurphy writes "Got this in the email just now. Despite reports I'd read that you had to write Amazon and ask for a refund if you saw they charged others a lower price, it seems they are letting their customers know proactively:
Greetings from Amazon.com.
Thank you for your recent purchase from our DVD store.
As you may be aware, we occasionally test various aspects of our
web site--design, layout, and other features--for brief periods to
determine how they resonate with customers.
Recently, we tested the discounts we offered on selected DVDs, so
that different discounts for certain titles appeared to individual
customers chosen at random. Because you placed an order for the DVD
"The Big Blue - Director's Cut" during this period,
we wanted to let you know that we will be refunding the difference
between the price you paid and the lowest test price that we offered
on that DVD during the test period, in your case, $1.49.
We also wanted you to know that if we conduct any price tests in the
future, all customers who order items affected by these tests will
automatically be refunded any price difference at the conclusion of
the test, thereby ensuring that they will pay the lowest available
price.
We value your business and appreciate the trust you have placed in us
by being a customer. Thank you for shopping at Amazon.com." You can see another news report about the havoc the "experiment" has played on things.
Reminds me of the beard salesman in Monty Python's "Life of Brian"...
In a way, this is sort of a backhanded way to "haggle" the price. By giving different prices to different people who don't know each other, it's sorta like a "single-blind" test to zero-in on the exact price where demand/sales/etc all balance out to maximize profits.
Trouble is, now that the cat's out of the bag, we'll soon see an "Amazon-Price-Watch" website appear, by which the "people who don't know each other" can trade info.
Now, if this could be done in secret (ie: Amazon doesn't know about it) then those "people" could basically pull a sorta "social-engineering" hack to drive Amazon's prices down.
What would it take to do something like that?
--jrd
XML is like violence. If it doesn't solve your problem, you're not using enough of it. --AC
What do you expect? They got caught with their pants down and now they need to save face. Can any of you seriously believe that if this hadn't been so widely publicized that they would have ever even considered refunding any money? Or for that matter, how many of these "experiments" have they done in the past without anyone ever noticing?
Why is it Amazon can pull something like this and just walk away from it? Saying "whoops" were sorry... "tee hee our mistake"???
Because it is not illegal to charge the highest possible price a consumer will pay before choosing a substitute. In fact, economic theory encourages it to push the economy towards general equilibrium. Simply put, there are people who feel they have no power over their purchase decisions (it's fate), then there are those who feel that it is actually THEIR decision. These are the people who benefit from the others because they get the lower prices which are paid for by those paying above the mean price.
Your resident economist
Zappa had a knack for saying things that sounded profound but weren't. Just like his music.
Marjo Wycam, Master of the Programming Arts
Actually, I don't think what they did was bad at all. But I would like to know what their official and full policy is. (Can anyone find it on amazon? I couldn't.) So now will everyone go back to paying their Amazon decided price for the Run Lola Run DVD, or will everyone pay the same? Isn't there an obligation to inform users when they are part of a test - could this be considered working for Amazon, albeit unknowingly?
This doesn't sound like Amazon is going back on the experiment. It's just saying that consumers who buy items during the experiment will get refunded.
--
The shareholder is always right.
First of all
I do not and will not shop at Amazon, but that is just a personal bias.
Granted I do believe that this is just another prime example on how your personal privacy is being lost.
Not only, is it a loss of privacy but the "marketing" information is now being used to discriminate against you.
I think that Amazon is doing this refund in retrospect of bad press for sites like SlashDot.
Second:
It's not just a simple case of being lazy. Granted Amazon doesn't give you a slogan stating the best price, but last I checked price descimination was illegal. You won't walk into a store and find out that the person in front of you got the computer for $1000 while you're being charged $2000.00
"Sometimes we all need to stop and think."
www.slightlycrewed.com - Because aren't we all?
No, we're talking about different people getting charged different prices for the same thing, and how the poster is offended by the very idea. The poster has obviously not had much experience with the real world.
...phil
...phil
"For a list of the ways which technology has failed to improve our quality of life, press 3."
that the experiment and the glitch are not related? Think about this, the original story states (paraphrased) "the difference between the price you paid and the lowest price offered" now.. if there were a "glitch" in the experiment that offered these prices to everyone on a couple of days, but normal prices on the other days of their experiment then, by their own statement, they would be refunding the difference between those 75% off prices and the rest of the orders placed on those items. Do you really think amazon is going to want to bite that bullet? I think they're trying to cover whats left of their a$$ as they watch their customer base dwindle like a pile of sand in a wind storm.
just my $.02 on that... on a seperate note... if you read the cnet article here amazon should NOT get away with this! If you walk into a store, see something priced for $20, take it to the register, it rings up for $20 and you buy it with your credit card. When the store realizes they had the wrong price for that item they, legaly cannot force you to pay what they feel was the correct price. Why should an online retailer be governed by different laws regarding prices, sales, bait and switch etc then a brick and mortar retailer?
BillyZ
- - - - - - - - - - - - - - - -
I take no responsibility for any spelling mistakes in the above post.
Because people have working assumptions that vendors will sell according to the market price? That it shows a severe lack of respect toward its customers that Amazon would do this? That people, were in fact, "ripped off"?
If this were normal behavior for companies, and people could assume that they could be selected to receive a higher than normal price, either randomly or according to demographic profiling, then, yea, they have little to complain about.
This is unlike your airline example, where most everyone understands that the closer you get to a flight, the more the tickets will be. Obviously demand is going to be higher for those buying their tickets at the last minute.
But that isn't how things work for bookstores. There is a fairly stable market price for books (and DVDs, and music). Books don't suddenly go up and down in value (unless Oprah starts harping about them), and certainly not in the seconds between one purchase and the next. No one expects that their individual price could be randomly because Amazon is not a place where you can haggle.
They did something shifty and sleazy and now they're getting spanked for it by the market (you know, us), and rightly so. Just because you want to bend over when corporations pull this crap doesn't mean the rest of us should shut up about it. Thank us, we're the ones keeping the market fair, and ensuring that *you* don't have to look at dozen websites to price things, and log out and relogin again to try to get the lowest random price.
Actually, I don't think what they did was bad at all. But I would like to know what their official and full policy is. (Can anyone find it on amazon? I couldn't.) So now will everyone go back to paying their Amazon decided price for the Run Lola Run DVD, or will everyone pay the same? Isn't there an obligation to inform users when they are part of a test - could this be considered working for Amazon, albeit unknowingly?
Zappa's Law (as relayed by StoryMan, who admits he may have gotten it wrong) may be cute, but it will get you into some serious trouble if you actually believe it in some consequential context. Let me give two pertinent examples.
.02%, but puts your company out of business when it gets posted on slashdot), it's nonetheless true that price shenanigans, heavy graphics, and all the stuff you and i may hate, have some connection with profits, and it's going to be hard to convince Amazon to stop trying to figure out what that connection is.
It's true that with respect to dying on a given flight, there are two major outcomes: dying and not. However, those two outcomes don't come in even proportions -- they aren't 50-50. If people from my country always fly on 50-50 Air, and people from your country fly on 99.99999-.00001 Air (both pretty shoddy organizations), then after a short period of time my country will be depopulated, while yours will thriving (but perhaps a bit nervous).
Now let's look at two online booksellers. 50-50 books figures either a book sells or it doesn't. PriceSetter Books is interested in the factors that contribute to the probability of a sale. PriceSetter figures out it can double it's sales of "Lucky Numbers" by changing the price from $13 to $12.95, and at the same time sell the same number of copies of "Worthless at Any Price" at $15 as it did at $12. 50-50 figures no matter what the price is, there are still exactly two outcomes, and just charges whatever they think is a good price. In both cases, a given consumer either buys the book or doesn't. But PriceSetter will earn more money, because they know that when you're talking about a million customers, there is a huge difference between 3% and 3.1%. And neither is all that close to 50-50.
Nobody really expects that booksellers won't try to maximize their profits by setting prices appropriately, whether profit is maximized in the short term, long term, or whatever (selling a book at a loss could maximize profits in some cases, I'm sure). But obviously in this case, people aren't happy with how Amazon went about it. I'm not so happy about it either, for many of the reasons listed in this thread.
Anyway, relevant to your message, I think we're stuck with the ad men and marketing slimeballs, because even if they're completely incompetent and come up with the wrong answers (price testing increases profits by
If you go to buy a car the sales rep (if he's worth any salt) has ALREADY profiled you. The way you talk, the way you dress, how you aproach him.. etc. He gets a VERY GOOD idea of how much you're willing to pay for the car.
Amazon is doing the SAME THING. Except instead of having a a person evaluate you it has a an algorythm based on your past habbits. What's wrong with that?
So you're a convinience shopper! You don't like to take the time to evaluate things.. FINE BY ME! U deserve to be charged more.. why? 'Cause you pay for the convinience. Get used to it.
It just seems like every one want's something for free these days.. well reality check.. NOTHING is FREE!
Ex-Nt-User
I agree! I wish /.ers would realize what it means to run a business.
oh well.
---
Sig Return: 204 No Content
...it won't be a test. It will simply be a new "pricing policy". Do take note that they did not publish the goals of the test, nor the results.
The end result is the same. If they raise their prices(for me) enough, I will go to a competitior. If their competitor does the same, I'll go back to the local store and pay cash.
Problem solved.
Good judgement comes from experience, and experience comes from bad judgement.
- W. Wriston, former Citibank CEO
So guess what. I don't like being fucked with.
Haven't bought airline tickets recently, have you?
In case you don't know, airlines do this all the time, and we're not talking about variations in the $1-2 range, more like $200-$400. It's called 'yield management' and prices can vary by the minute.
Given the attitude you've expressed here, I presume you don't patronize airlines either, huh?
If, on the other hand, you DO patronize airlines, then what does that say about your attitude?
...phil
...phil
"For a list of the ways which technology has failed to improve our quality of life, press 3."
Racial or gender discrimination isn't legal, but Amazon doesn't have that information anyway. But no company has any obligation to charge customers identical prices for the same item. If the guy in front of you has a "$1000 off your next computer" coupon, you'll be charged a different price. Kids or the elderly can get discounts for all sorts of things, thus being charged a different price. If a company has a sale, the people buying before and during the sale get charged different prices. If I buy a car, I might haggle a different price than someone else for the same model/features.
It's called capitalism.
Ita erat quando hic adveni.
I think they've been experimenting in many more places. I wonder if they're going to come clean there too.
If they will always refund the differences of these "tests", then why do them? They must still think that eventually they will arrive at a point where they will be able to implement it for good.
But I think that someone will always be watching and will always notice now. About the only way I think they'll be able to get away with it is to have some kind of "frequent buyer" club like my local grocery store. Basically they raise the prices of everything and then give you "discounts" on most stuff for being a member. It's a scam but they make it look like you're getting a deal. Amazon might do it that way but I don't think they'll ever get away with doing it in secret again.
When I shop for something online, I spend at least an hour looking for the best price. I check at least 5 sites, a couple of auction sites, not to mention that big blue covered thing called the Real World, and when I find the best price, I take it. Assuming Amazon gives the lowest price, who cares if someone else got an item for less than you? Welcome to Consumerism 101, it happens. Somebody mentioned airline tickets the other day, perfect example. You could have paid half what the person sitting next to you paid, you could have also paid double. Shop around first!
"If they were doing research, that's something that costs money," he said. "They can't expect to do research for free all the time."
It's their system, if you don't like it, don't use it. As much as I disapprove of recent Amazon actions, it's still their right to tweak their own system.
--trb
It's on Slashdot isn't it? It HAS to be a conspiracy!
Not only that, but will they be applying a refund to the credit card, or just giving you store credit? If the latter, then they make even more money on interest, and they don't have to pay any fines to the credit card company (if you make too many refunds, most credit card companies will charge you a fine).
--
And the men who hold high places must be the ones who start
To mold a new reality... closer to the heart
Jeff Bezos is a smart guy and Amazon has a good PR department. 'nuff said.
Kaa
Kaa
Kaa's Law: In any sufficiently large group of people most are idiots.
...if this was actually an 'experiment', or if they thought they could get away with it? With all the bad press they recieved over this, I would assume the later.
Do you know what the purpose of a business is? Let me tell you: to maximize profits. If you can pay more, there is no reason why they shouldn't charge more. Ever buy a car? Some people pay more than others for the same vehicle. Yet no one on Slashdot gets upset.
Amazon's business practices are their own problem. If you don't like it, how difficult is it to buy your "The Professional: Director's Cut" DVD elsewhere? It's a free market.
-- Floyd
-- Floyd
What are you rambling about? They didn't switch prices on people. People were shown the price they paid. That's it. They didn't see one price and get charged another.
Of course, like many others here, I'd be willing to assist Amazon in their drive toward profitability. By my last count, they've lost at least $300 in sales which went to a competitor (Barnes and Noble, if you must know) which would have been theirs without the boycott currently in effect, so multiply that by the number of folks not willing to buy until the time Amazon drops "one-click" patent nonsense.
...Open Source isn't the only answer -- but it's almost always a better value than the alternatives...
They most certainly would not. All sorts of promotions and contests work this way. Take for example the contest gamepieces you get at fast food restaurants -- like McDonald's Monopoly game or whatever. You get your card when you buy a burger and scratch off to see what you've won. Maybe you've got a 1 in 10 chance of getting a free fries during your next visit.
What the government would go nuts over would be if the pricing or discounting was done in a NON-random manner. (e.g. all white people get free fries while everyone else pays.)
As long as its non-discriminatory, differential pricing is something that's been happening in the off-line world for years. Just because it's on-line doesn't mean it's new!
That fewer than one percent of contestants ever mail in a request for a free game piece is testimony to the promotional value of the contest, but technically it's still not gambling.
--
This is not my sandwich.
Why? Did Amazon charge your credit card more than they said they would?
...phil
...phil
"For a list of the ways which technology has failed to improve our quality of life, press 3."
"Is it unfair that I have to pay more for gas in the city than out in the countryside?"
:)
There are people who will blindly answer "yes" without any idea what's involved in selling gas. At the Oregon State Fair a few years back, my mother helped run a booth, and became aware that there were rules determining what price may be charged for soda. Apparently if you wanted to sell soda you had to sell it at the same price as everyone else who sold soda, no more, no less. This being a semi-private event which vendors participate in voluntarily, I can't complain too loudly, but I find the notion of comittee price fixing disgusting. However, it exists, and probably because someone said, "it's not fair that I should have to walk 100 yards to find a good price on Mountain Dew". Fair? Who cares? Do you want the drink or not? Do you like the price or not?
In any case, there are a lot of people out there who DO think they are the center of the universe and everything should be figured out for them because it's only "fair". Don't ask them questions to which they will be happy to give you the wrong answer.
Right or wrong isn't the point. The point is they pissed off customers - which isn't nearly so much a question of ethics as it is a question of intelligence.
Whether this move was "wrong" or not is irrelevant - that it was incredibly stupid is relevant.
You will never go to your local food store and aruge for a better price.
Bzzt - try again. I am an American, and I love to haggle. If I go into a grocery store, and see a product at one price that I know that I can get elsewhere for less, I will let the manager know, and let him know that I am fully prepared to walk out of the store, not buy ANYTHING, and spend my money at a competitor. Sometimes it works, sometimes it doesn't.
What really gripes me is the way they screw with you on "bulk" pricing. A store may charge $3.99/lb for chicken breast, for a four breast package. But the "family" pack of 20 breasts may go for $2.99/lb. WTF? The family size took more effort to prepare than the smaller pack (more pieces to put in the pack, generally by hand - but if by machine, then it shouldn't matter). On top of this, both packs are store brand packs, packed at the same store - from the same bulk purchase by the store. Thus, the difference in the pack isn't the amount of chicken in the pack, nor the amount of effort to prepare the pack, nor where the chicken came from. So why is it?
It is simply by what they define as "family". Apparently, they define a family as 2 adults, 2 kids - with a big freezer to stick all that meat in. They have never heard of a 2 person family with a small freezer who like to prepare meals the "european" style (ie, going to the store several times a week - or daily - rather than "stocking" up).
When I see this practice, I haggle. Hardly ever win though (gotta love the people's looks around me - they think I'm nuts - I love it!).
Regarding car buying: Many people like to haggle when buying a car - what people don't like is the shitty way salesmen treat them during the process, such as leading them away from the car they want, trying to get them in a higher priced car, or doing bait-and-switch style tactics. I am not saying everyone loves to haggle for a car, but quite a few people do.
Lastly - regarding yard sales in America - yes, people do still haggle at them - but I have had a few yard sales in the last couple of years, and have been to many more. What I have been seeing is people NOT haggling at yard sales, which was strange (like every item had FIRM marked on it, or something)...
I support the EFF - do you?
Reason is the Path to God - Anon
Totally different. The effort here is to reduce drunk driving by not selling booze cheap.
...phil
...phil
"For a list of the ways which technology has failed to improve our quality of life, press 3."
My reply from my e-mail to Amazon:
Thank you for writing to us at Amazon.com.
>From time to time, we test and re-evaluate various aspects of our web
site to determine which characteristics drive customer purchases and
satisfaction. We've learned that certain aspects of our site resonate
with customers in different ways, and we are continually fine-tuning
our presentation--site design, layout, price, customer reviews--to
provide our customers with the greatest value, selection, and
information for their online purchasing decisions.
These tests are conducted for a brief period during which certain
sections of our web site will appear differently to randomly selected
Amazon.com customers. Price is one aspect we may test, and
accordingly, that means that some customers may pay a different price
for select items. However, please bear in mind that the discounts we
offer on items in our catalog do vary even when we are not testing our
site.
I hope that I have been able to address your concerns. We value your
business and look forward to serving you again in the near future.
Best regards,
Kim H.
Amazon.com
Earth's Biggest Selection
Eagles soar, but Weasels aren't sucked into jet engines.
Don't offline businesses already do just that? Promotions like "nth shopper gets their groceries free" or the Visa/Mastercard/Discover (or was it AmEx?) promotions around December that they'll pay your bill.
In a free market buyers and sellers agree on a price. If buyer[0] was able to agree to a price that was lower than buyer[1], then good for buyer[0], not "shame on the seller".
My thanks, though I've coped with worse that this littl pissant.
Enter the web. Amazon has your shopping history and other information that helps them guess your real reservation price. You evaluate their product several times, checking prices at other sites, trying to make up your mind. Each time you look, Amazon presents you with a different price, effectively negotiating to try to get you to buy closer to your reservation price than the market clearing price. And it's done by a machine, not a costly sales rep. I don't blame them for trying it.
--
Oh, yeah, it's not easy to pad these out to 120 characters.
Now if they would just drop that patent, I would buy things from them again...
PS. Want sex?
Send ten people to a car dealership (not saturn) and they'll end up paying ten different prices for the same car.
If Amazon is going to charge me a higher price because I don't shop there enough or whatever they're playing a dangerous game because chances are I'll find a lower price somewhere else.
But now that Amazon has been 'busted', they need to do something. And that is apologize, and hope that they don't lose too many customers over this. Even though there's nothing wrong with 'this' in the first place.
It's all bottom line and public perception. Next time they'll take it to a focus group first.
Mod this up. He's right. People paid a price that was agreed upon and now they are mad that someone else got it cheaper. Next time shop around.
Thanks, I needed a good laugh...
XML is like violence. If it doesn't solve your problem, you're not using enough of it. --AC
I say screw 'em. What would their reaction be if you said, "Oh, oops, that was a glitch in my browser, I only wanted to pay $30 for that book, not $50! My bad."
-bluebomber
The Daily Build
The Big Blue - a great film, I would have ordered, too. Wait, it will only be a good experience to watch on a large screen in cinema, I wouldn't. So the poster must have a large screen at home... so she/he must have the money... so, the "price test" actually worked, don't believe the "random" thing, Amazon know what they do!
I think it is funny that some people are getting hot and bothered over this, yet we accept the fact that virtually all stores have sales. Is it really reasonable to arbitrarily offer a lower price to customers who happened to come in last week, but not to those who come in this week--but unreasonable to use a random number generator to decide who gets a shot at a bargain?
what you describe is not an accepted practice of "haggling at the market" it is something unique to you. You try to argue for a better price? great. thats not what everyone else is doing, and you are out of place when you do it. Ever visit a country where it is expected that you barter? From your comment it doesn't seem that way. I spent some time in Honduras a few years ago, and you could tell the American tourists (myself included) were unnerved when buying things. When you shop in a US store, you aren't expected to barter, case closed. Take your "buzzer" someplace else.
--------
-------
"Every artist is a cannibal, every poet is a thief."
Here is a link to a prescient column by Jakob Nielsen: Profit Maximization vs. User Loyalty
The entire thing is worth reading, but here is a good quote: "Even though standard economic theory says that you should employ [differential pricing] strategies, I warn against them due to their impact on user loyalty."
-----
D. Fischer
ShoutingMan.com
I really agree with many of the comments in this post, but you're neglecting to see their side of it...they KNOW that the average consumer is NOT a savvy one, and so they can pull this bullshit and 99 times out of 100 get away with it. Here is that one time, and they're more than happy to refund that $1.40 on a DVD or whatever because that is BULLSHIT MONEY. This isn't a $50 million lawsuit here, this is a dollar here and two there. I'll bet this "refund" doesn't amount to more than a 6 digit number, and they'll easily get that back the next 99 times they rape you.
You next ask why they don't ask you, Joe Consumer (or me, Bob Consumer) what you want, is because frankly they don't care. The American business is used to telling you the way you want things, because it's not hardly a matter of whose product is better anymore, products are pretty similar nowadays, its who can make my shopping experience for the product the easiest and most pleasant? And they don't even have to DO that, they just have to CONVINCE you that theirs is! The end result (yes there is a point), is all these tailored emails and advertisements and other "personal" bollocks. If you haven't noticed, you don't have a lot of choice whether or not to participate in these things, if you want to buy your product from a certain place.
The bottom line is, you're a Slashdot poster/reader, you have at least half a brain, probably more. Most people don't have this privelege.
Well, I never said that I wasn't an abnormality in the "system", but the way you phrased the question may it seem like you were targeting individuals:
You will never go to your local food store and aruge for a better price.
If you were meaning to target the group as a whole, then a better phrasing would have been:
The average American would never go to the local food store and aruge for a better price.
I can't say that I have been to a country where one is expected to barter (closest I can admit to would be a Mexican border town - usually you can barter there, it isn't unheard of, but vendors get ansy when they see an American bartering), but I would imagine I would enjoy it. I tend to only barter if I feel the price is unfair, or if I would like to get a lower price (if I feel the product is worth what it is marked at, then I will pay what it is marked at, no questions asked - it doesn't matter if it is a flea market, garage sale, or car dealership - fair is fair).
You are right in saying that "when you shop in a US store, you aren't expected to barter" - but just because you are expected to do something, doesn't mean you have to, or should...
I support the EFF - do you?
Reason is the Path to God - Anon
You are obviously not a math guy. Probability is important: it is not as dangerous to fly on a commercial airplane, or say, bungee-jump out of a baloon with the bungee on fire. The probability is not 50-50 on both incidents. But, by all means, prove me wrong. Back to Amazon: wake the hell up! retailers have coupons, promos, catalogs, a bazillion things customized to give different prices to different people so they can sell as much as they can at the highest margin that they can get. It's not a swindle by some "Microsoft drones", its called, you guessed it: Capitalism. Live with it or get out of the way. And what the fuck is up with the "Microsoft drones" quote? does any rip on Microsoft get a 5, Insightful on /.? What on earth does this thread have to do with MS? I mean Amazon uses Perl, AFAIK, not ASP...
Do you feel the need to attack MS to look /.-cool? is that the quality of post we are moderating up these days? sheesh...
Sarkazmo is the assumed identity of a long-time
Huh?! Maybe the U.S. is weirder than I thought. (I'm from Canada.)
Linuxrunner, are you telling me that in the U.S. I'm not allowed to negotiate a better deal for myself in a computer store? Or that the salesperson is breaking the law by giving preferred or high-volume clients a better price?!
Bizarre. Surely capitalism isn't that strangled south of the 49th, is it?
A lot of this stuff is fodder for Slashdot paranoia.
Did Amazon play with prices? Sure. Is that their right? Sure. Do I have a problem with it? Not really, though mainly because it wasn't *big* price differences. Did they "do the right thing" in the end? Yes.
Conspiracy theories aside, Amazon has always offered the best customer service for all my transactions. This isn't really bad press outside the geek circle... I don't see how this is a warning sign at all.
The only warning signs, as you say, are Amazon's earning reports.
-Stu
>Thanks to the test though, they now know the
>figures neccessary to maximize profit, and they
>could give a shit about you. They just found out
>exactly how many people would pay what amount.
...there is something wrong with that?
As far as maximizing profit, that's what every business seeks to do. It always involves curtailing something. If it is true that discarding part of their potential market is the way to maximize their profit, I don't have any quarrel with that.
There are always certain customers that will feel that the price for whatever item(whatever it might be and whichever method was used to derive it) is too high.
Good judgement comes from experience, and experience comes from bad judgement.
- W. Wriston, former Citibank CEO
There is nothing wrong with Amazon varying their prices to gain maximum profit. Amazon is in business to make a profit, and prices vary according to demand - basic economics.
Would you expect sears to sell any item at a uniform price at all its stores ?. Do you think that a big mac costs the same in NYC as it would in Toledo ? Of course not!. Stores vary prices to maximise profit, as do people. Salaries and real estate prices are prime examples of the latter.
Given the nature of capitalism amazon is within their rights to vary prices. Giving discounts to select groups may even be good for business, and most customers would appreciate such a policy. An example would be selling reggae CDs at a lower price to persons who have bought a lot of reggae CDs, same for C books. Now, doesn't that sound familiar ?
Woe be on to them, all who rise against poor people, shall perish in a the end. Buju Banton
'Cause they're not.
Wah!
I did not word it correctly and I apoligize. What I meant to get across was the fact that this seems vaguely similar to price discrimination.
As you stated, someone could have a coupon to get $$$ off. But as we see here, this just is not the case. There is not coupon. Prices this time were dropped, I think, based on marketing information, probably not at random as they say. What happens if next time they are raised. Does that still count as "capitalism"? All Amazon has to do, if you complain because you found out, is that "oh, sorry, there must have been a glitch..." and they're sitting happy becuase there were thousands of customers who didn't catch the "glitch".
www.slightlycrewed.com - Because aren't we all?
What cookies are they checking? Do you know? Does anyone? What if Amazone determines typical buying habits/web surfing habits of a user and price accordingly based on theirparticular, age, sex, race, etc.? Wouldn't this be illegal?
jeko writes "Amazon.com just sent me an email claiming that their different prices for different customers are merely a mistake."
He cites email from a customer rep at Amazon:
"Finally, at any given time, despite our best efforts, a small number of the more than 4.7 million items on our site may be mispriced. Kristine Jorgensen, Amazon.com"
So which was it... a mistake or an experiment?
Josh
I hope this practice doesn't become the latest rage on the web. Personally, I think that Amazon should patent it and not let anyone else use it!
Got Rhinos?
My god, if retailers kept abusing their power to price things differently for different individuals, congress might have to enact a 'fair pricing' law. Heaven forfend.
What the hell is with people that think pricing should be 'fair'? Who the hell ever guaranteed that everyone should pay the same price for the same goods? Is that in the consitution somewhere?
Is it unfair that I have to pay more for gas in the city than out in the countryside? Is it unfair that I have to pay more for a plane ticket than the guy who reserved weeks in advance?
Amazon displayed the purchase price and every single one of the people that are now getting a 'refund', agreed to pay the price Amazon quoted. I don't get it, refund of what? If you paid the price both you and the seller agreed upon how can there be a refund?
-josh
No, they're different -- witha happy hour, everyone wins. I's more of a problem with the drinking laws in Illinois than with anything else. Can you explain what's wrong with a happy hour? It's a business model that benefits everyone. The customer gets cheaper drinks for a limited time, and the establishment gets to sell more drinks (with a reduced profit margin, but gambling that the increased sales make up for that loss). Who loses here?
"The invisible and the non-existent look very much alike." -- Delos B. McKown
What is everyone so upset about? So they gave out discounts to random people. They didn't RAISE the price, they LOWERED it for people. Just because youwern't picked to get the lower price everyone gets all sobby. If I own a business it would be perfectly leagal, and perfetly lethical to float over a city and drop 100 coupons for 1.49 off a book i sell. well, legal except for the littering fine i would probably get :) So what exactly is the problem here?
How wonderfully innocent of you to believe that. The real reason that they said they were sorry is to try and salvage any good karma that they had left with their customers. Rest assured that if they had not been caught they would have continued to vary their pricing in order to determine the point at which they get the maximum profit.
When I want your opinion I will beat it out of you.
Ah.. but you assume that the frequent customers got better prices...
Wrong.
I have purchased over 600 DVD's from Amazon since January 1999, and about $600 in books, and even a ShopVac (hey.. walmart was out).. So I think I can consider myself a frequent customer.
So how come I just got 5 emails from them refunding $63 in 'overcharge'?
Seems to me that they're charging those who shop there more... more money.
Screw them. I cancelled all of my pending orders and replaced them with buy.com.
... and all I wanted for xmas was a magic 8 ball, but i got this lousy
decisions (it's fate), then there are those who feel that it is actually THEIR decision.
we are in agreement. I understand what/why Amazon may want to alter their prices.. that is not my point. Simply: Raising the price of something AFTER it is purchased is unacceptable; for any reason. Using "a glitch in our price-change-monitoring system" as a reason to not supply a product at the agreed upon price is unethical (at least - likely 'illegal')
small warning for posting fake PR
I think the significant difference is the awareness. I know that department store sales are conducted, and publicized. If I chose to, I could go to the store during the sale and be assured of getting a 'lower' price, or I could go after and be assured of getting a 'higher' price. There's little or no chance that when I walk into my local store, I personally will not receive sale price while my neighbor does.
On the other hand, I wouldn't have known that Amazon was offering varying prices. Nor, if I had known, would I have been able to respond to that appropriately. Maybe randmoness offends the sensibilities; 'if I try hard enough, I'll be able to secure the best deals.' Certainly it defeats the common notion of roughly equivalent pricing for literature. We're fairly used to book prices being relatively stable.
Perhaps the real fear is that with secrecy and randomness, there is the potential for abuse. Preferential treatment could easily also be discriminatory.
The compensation comment was mostly a joke, directed not at the purchase, but at the valuable marketing information we would have inadvertently provided, had the 'tests' continued.
---
"The Constitution...is not a suicide pact."
"Life. Don't talk to me about life."
I completely disagree with you until you come up with better analogies.
Please tell me how I can negotiate with Amazon.com the way I can at a used car dealership and flea market.
The perception of reality is more important than reality itself.
There is no such thing as "price discrimination". If Amazon thinks a bunch of consumers will pay $22 for Product X but the rest will only pay $20, they're free to try and charge the bunch of consumers $22 for it. There's no "bait and switch" here; everybody is still paying what Amazon charges. But if that bunch of consumers sees that SomeOtherSite.com is charging only $20 for Product X, Amazon will lose those sales. Thus, the price for that bunch will fall back to $20 again.
It's still capitalism and if you want to make it work, you have to shop around.
Ita erat quando hic adveni.
OK, of all the posts, you've given me the best analogy that might fit with Amazon's case.
/., there is a business reason why you are giving someone a discount. The location analogies (gas, TB, etc) can be chalked up to rent. I have to charge you more because this building costs me more at the movie theater, in the city, on the turnpike, etc (don't forget you have to pay for exclusive access like at theater, turnpike). Or, in your case, a volume discount. I remember a law (IANAL) from my BLAW that said (I think it was Robinson-Pattman) that you can't charge two people different prices for the same object without a material reason.
But, in every RW analogy posted on
That's my beef with Amazon. This seems totally random. If I could attribute a material cost benefit to my discount, I would be fine. Without that, this is just total BS and I am on the short end of the straw.
The perception of reality is more important than reality itself.
You want a reason ? How about customer profiles ? If a certain web shopper has a long-standing positive history with Amazon or other affiliated sites, I think that entitles him/her to a discount. Proving that history is something else entirely. Anybody can fake a bunch of DB records for the IRS. Anybody can print invoices with past dates for the IRS. Anybody can lick their own nuts for the IRS. The point is, even though Amazon is better at making us sick than selling us books, what they're doing might be borderline illegal, but it's practically impossible to fight in the present legal system because there are very few (if any) laws to govern e-commerce at this time.
-Billco, Fnarg.com
Perhaps *I* am cynical, but why the hell is this thread titled "Amazon Refunding the *Overcharge* Experiment"? Amazon is clearly not trying to rip some people off, they are giving a *discount* to some people who would otherwise not buy from them.
What the hell is wrong with that? it's called bargaining (as in what happens in a bazaar, you know the thing that's much better than a cathedral?) and it's SOP in 80% of the world.
Amazon has done some stupid stuff, but they are not by any stretch of the imagination some big evil corporation out to assimilate the world, and I am sick and tired of the anti-Amazon bias of the stories posted here.
I am also considering buying exclusively from them from now on, just because I know I have a *chance* of being offered a discount. Because I am *that* cheap. I use Napster too.
Sarkazmo is the assumed identity of a long-time
I don't care about personalization (contrary to what Microsoft says I *should* care about), I don't care about targetted e-mail, targetted advertising (contrary to what *sigh* even my beloved TIVO thinks) I care about the lowest price.
Glenn Fleishman runs a price comparison site. He says that, after a comparison, people very often choose to buy from Amazon even if they have the higher price.
__
__
Men with no respect for life must never be allowed to control the ultimate instruments of death.
GW Bu
I think this has been mentioned in passing, but I'd like to reinforce it.
I am a student in Construction Engineering, and one thing we've gone over is bidding strategies. The basic premise is that when bidding on jobs, you have an estimate of how much that job will cost you to build. You then look back at history, for similar jobs with similar competitors, and look at your probability of getting the job based upon various prices, such as 10% under cost, 10% above, and so forth. So we now have an idea of what the job will cost to do, as well as our likelihood of getting the work at various price points. Then we multiply the probablity of getting a job at a price point and how much percentage profit we'll make at that point, and find the price point which maximizes our profit.
Now this isn't a that aims to win every job, but over the long term will maximize profits. I see Amazon as attempting to do this type of research. Unlike a bid on a construction project, where bids are usually public knowledge, Amazon doesn't know where people who didn't buy a certain book went, or if they bought it at all. Therefore they're able to vary the price of a book, based upon the amount of profit they're making on it, and see what percentage of viewers of that item bought it. So we're back to probability times percentage profit. In my mind, it's market research, and they have been willing to at least give people the best deal available at that time.
In the future, I would not expect much in the way of fluctuating prices for products sold at Amazon, but more of a price that will maximize their profit (or minimize their losses, whatever the case might be).
Thank You! I feel the exact same way. There is to much amazon.com bashing at slashdot. I'm tired of seeing every post end with "now if they just drop their patent I'll shop there again", guess what? I've heard that a biggilion time now and I don't care and I'm sure a lot of others don't care either. Amazon provides an execelent service, good luck trying to find the information they provide, customer service, and low prices in the offline world.
Well, this just gives me a warm fuzzy feeling all over that Amazon.com just wants to do the right thing and has their customer at heart.
(snigger)
Forget Amazon -- I go to CDNow for CD's, especially if I'm looking for a hard-to-find album. Do a search on it. If it's not there, come back in a week or so -- it will be. They seem to be paying a lot of attention to the "misses" on their database. Now THEY want to satify their customers!
What I can't understand is why they'd even let this get out of hand like it did. I mean, the only thing Amazon really *has* above the competition is a base of really loyal customers. *Why* would they want to alienate them like that? Patent issues aside, I think Amazon has done a damn fine job with their site and all the nice features they've added, making it a real "comforting" and convenient experience. Why would they risk it all with a ploy like this?
It's 10 PM. Do you know if you're un-American?
The link in the story doesn't talk about a pricing experiment at all... it discusses how the prices on certain dvds were way lower than they were supposed to be?
Again... which was this... an experiment or a pricing glitch (as hinted at in the recent Slashback)?
Josh
Bezos! Quit trolling slashdot. Talk about whiny and self-important, sheesh!
Look around the site. I'm sure you'll see a disclaimer like you see on catalogs stating that they won't be responsible for typos or pricing mistakes.
Be sure to visit Joystick101.org for in-depth gaming news.
With two headline-making price glitches, Amazon is looking a bit inept at this point. What's amazing is that they've managed to develop one of the best, most comprehensive, and most innovative online shopping experiences and they can't figure out how to keep their prices straight. It's too bad they're not doing their new car store in-house. ("Check it out, this new Mercedes lists at $50,000 but I got it from Amazon for $8995!")
But what's even more amazing is their lack of business savvy on this particular issue. Amazon thrives on repeat customers and that requires good customer service. Whatever loss they would have taken by shipping discounted merchandise, the cost of all this bad press will be worse. If you're looking for signs that Amazon's on its way out, incidents like this are even more of a warning than their earnings reports.
If that's true, then it doesn't seem to me that they were caught with their shorts down.
But maybe they planned to have their shorts down as long as possible, planning to pull them up as soon as enough people noticed.
--
This happens all the time, in all markets. Take for example your favorite fast food chain. Let's make it Taco Bell for the sake of my example. Suppose your neighborhood T.B. sells their tacos at 79 cents each. Go to the movies and go eat some Taco Bell there, you'll pay at least 99 cents each, a 20% increase for the exact same product (although often inferior because they're in such a damned rush).
Let's take another example : Let's say you buy a shitload of computer gear like I do, and you almost always stick with the same shop for whatever reasons. Let's say you want to buy a GeForce2 with all the fixin's , that retails at maybe 569$ (in case you're about to have a seizure, those are canadian dollars). Well since you're such a loyal customer the shopkeeper might let you have it for 529$ at 40 bucks off since you've probably brought him 20k worth of business in the past 3 months. This is perfectly legal and happens every day.
So in conclusion, this is another case where everybody bitches when they're on the short end of the straw, without realizing that the situation is often reversed.
-Billco, Fnarg.com
Dude, my point is this (and believe me, I understand it's captalism at work): if there's a coupon for something -- and I'm able find it -- then, fine, I'll use the coupon.
I know Buy.com is running a deal for free shipping now for orders over a certain amount. Great! I'll get that Palm V and get free shipping. Great! That makes me happy.
I know techbargains.com has a pretty decent tally of the latest coupons and bargains. Super! I'll check techbargains, see if there's a coupon I like, and then use it to buy something. In fact, I'll use it to lower the price of an already low item. Great!
Why is this great? Because it empowers me as a consumer. It empowers me to take 10% off the top of an already low bargain. It empowers to me to know that for certain shops I can get *even more* by going to ebates.com and getting another 2% or whatever off the top.
And believe me, I'm the first to admit that it requires some effort to get the lowest price -- and oftentimes the sheer effort simply obviates the bargain because my time (and yours, and anyone else's) is generally worth more than the dinky bargains that I can keep skimming off the "list" price if I know how to shop.
Kinda like those idiotic coffee coupons that Seattle's Best makes you carry around (buy 10 get 1 free). Those things annoy because (a) why can't they just give me a fucking low price instead of making me work for it and earn it by carrying around stupid cards that (b) need to be stamped by bored clerks and their little first grade stampads. But I digress...
My point here -- and even with the reference to Seattle's Best -- is that as a consumer you should *know how* to get a good price. (You may not now in what specific newspaper a specific coupon exists for a specific discount, but you know that if you searched around and spent a little time, you could page through the Sunday supplements and probably find a coupon for 30 cents off Pledge cleaner and your local supermarket.)
What Amazon did wasn't "consumer empowerment." They didn't seed coupons around for repeat customers or for loyal customers or for new customers -- they simply did back office tricks to see who'd bite on what.
And yes, yes, yes -- I understand this is how capitalism works -- at least "consumer capitalism" -- the law of supply and demand -- the idea of fscking with prices to see what's the "target" price or the "trigger" price by the "target demographic". And, yes, this is what I meant by Microsoft drones (even though Amazon isn't an MS shop): everybody is touting "personaliztion" as the panacea for the coming internet consumer economy.
But the goal wasn't better pricing or (god forbid, I mean: what the fuck are you talking about?) goodwill toward the (eek!) consumer!
The goal was get data for their personalization database. (Whether it's MS or not -- whatever -- hence the MS crack -- drones gathering data -- blah blah blah)
"Imagine this: you can log on and WE'LL tell you what we THINK you might like to read! We'll keep track of your newborn's age and TELL you that at 3 months your newborn will probably need item X or item Y and at 4 months [hello! it's us again, we'd just though you'd like to know...] that your newborn needs item Z and [hello! it's us again] we notice that you've bought items from X and Y shops and thought you'd like to know that Z and A and B and C is on sale and [hello! just a quick note] that other people in Centerville USA are really grooving to the new sounds of Y Band or reading the latest Oprah book or that [hello! it's us and we'd thought you'd like to know that] all of your friends and neighbors are reading Harry Potter and that [hello! guess what? it's US!] because they're reading Harry Potter and they're between the ages of 25 and 30 and were born under the sign of Saturn on a Wednesday and are predominantly male post-graduates who attended Yale in the 80's and had friends who went to Michigan who, at one time [hello! we're sending this out to all your friends, too!] participated in a seminar taught by Prof Z who once [hello! Did you know] knew a Black Panther by the name of [books about the 1960's? you bet!] Argentinia P. Cheek who had a child murdered by a police mob [and -- hello! -- did you know Argentinia now sells a cookbook and how-to book for people in the suburbs] that was also at Kent State [books about politics and Vietnam? You bet!] and stood behind a tree while the National Guard murdered the students [hello! it's us. Did you know that other liberals on your block once fought and died for their brothers and sisters and stood against the pigs that hawked the war in Vietnam] and you [hello! we know you! we know! we know who you are, how much you make, and based on our statistics] and you, standing behind that tree, watched it all unfold and didn't do a damn thing but that 30 years later, you still made it into our database of aggregate consumers who wear clothing, speak a language, and live and breath because that heart in your chest is enabling your soul to want our stuff, to buy our products buy our stuff buy buy, yes, yes, buy buy buy our shit."
I mean, for fuck's sake: enough.
Personalization is insane. Just give me a low price.
I walk out the door I'm either dead or alive. I don't need statistics. I don't need the latest MS commerce server or site server or SOAP or XML to coordinate my location with the number of gallons left in my gas tank with my income lost last year to bad corporate decisions by 20 year old whiz-bang CEO's.
Just give me a good price, take my money quickly, and get the fuck out of my face.
I'd say it would have been a better PR exercise if they hadn't gone around sending emails saying "you ordered at this price. we're shipping at this price. if you don't like it, then cancel your order, it'll sit there until you approve/cancel it".
my boyfriend got one of these, after he got some very nice prices, courtesy of Amazon's little "tests". after that email (though I'm not sure how many people they sent it to -- I know quite a few anyways) I think people are going to be a little pissed.
of course, if they don't publicise it, it's all for nothing, isn't it?
Lea
Whether you like it or not, what Amazon is doing (varying prices) has been done by many businesses for many years. Changing prices helps a business know which price to offer a product for the maximum profits. It's just easier to see that online than at Wal-mart. Both do it.
Products have price elasticity. And different people have different demands for products. You might _love_ CD's and buy a dozen of them a week, whereas another person may buy one or two a month at most. Which customer does Amazon (or any retailer for that matter) want? So, maybe it would be in the retailer's best interest to offer that big buyer a better price. As long as they are still making money it certainly would. And I know I'd want to get a discount if I bought at those quantities on a regular basis.
Come on people, this is simply! Even Subway has a buy 10 get one free card at many of their stores.
Ever ride the Metro in DC? The price is higher during rush hour than during non-peak hours (or at least it was the last time I was there).
I've seen restaurants offer deals for families Monday through Thursday nights. Business is slow, and they are trying to bring in customers to help keep themselves in business. Are these restaurants "dirty rotten scoundrels" for not offering the same deal all of the time? No, and neither is Amazon (although I'd like to see them drop the 1-click patent).
Wayne
I think we should all be proud of ourselves for generating enough not-too-offensive noise about this that it made amazon react without a costly judicial order.
I setup an "Xmas Shopping List" (or whatever they call them) on Amazon last year. My mother ordered what I wanted and they said that they were shipping it (3 weeks before Xmas). Dec 23rd she gets an email saying that they didn't ship one of the items b/c it was out of stock (3 weeks).
/.'ers refusing to use their service isn't going to hold them back any... I think that serious legal action should be taking against these fools to stop what they are doing. This is is some serious crap. My last order (Friday DVD) will be my last for sure...
.02
Then they start tracking you and telling you tough shit...
Then they start overcharging you and then send you an email later telling you that you will be refunded.
My question is: how long before they go under for being fucking stupid? If I went to a bookstore and they fucked me over like Amazon.com has been the past year I would move elsewhere. They feel that they are the next Mickeysoft b/c they are the WalMart of the Internet... They can do whatever they feel like and not have any consequences.. A few
Just my worthless
- Bill
We aren't talking about airline tickets. We're talking about Amazon.
/. starts with how the airlines rip you off, we'll talk about them then.
Yes, it is a example, maybe even a good one. When
The above post is an editorial, the poster cannot and will not be held responsible for all or in part for it's contents
"Please be aware that when we do shut down the website, we will sell the user data we've been colleting about you to the highest bidder."
You know, I bought a car a while back and then found out that some people got better prices than what was marked on the sticker because they took the time to bargain with the car dealer! And at a flea market last week I bought a book for $3, only to find out that people were buying two for $5! What a rip-off! And I could throw in some things about how the internet is a bit like a bazaar, but I hear prices aren't always fixed at those things either!
C'mon people -- why is anyone getting all worked up over this thing? Amazon is not ripping people off -- they're running a business. Searching around on the Amazon might have found you a better price, but everyone who paid the higher price agreed to that price -- no harm no foul. Maybe some customers are gonna be a bit upset at not having gotten the best deal, but that doesn't make Amazon "bastards" and "crooks"...
JAMWiki Java-based Wiki engine
I can't wait to see the Slashdot headlines: "Your Rights Online: Amazon Scamming People out of Three Cents."
Got Rhinos?
So which was it... a mistake or an experiment?
I'm sorry, in this world, it is possible for a big company to simultaneously be doing a pricing experiment AND have some incorrect prices in their database.
You see, they are not mutually exclusive events. Therefore, your question, "So which was it?" does not really apply.
-thomas
"Extraordinary claims require extraordinary evidence."
"And like that
Maybe I'm not "getting" it, but why would Amazon conduct this sort of test in the first place?
If I were a retailer -- especially a big one like Amazon -- the only "testing" I'd do would be something along the lines of the Frank Zappa test: either you're dead or not. (Or, in the case, of Amazon: either we have the lowest price or we don't, period)
Zappa once joked (and I'm paraphrasing badly here -- if someone knows the complete context or quote, I'd appreciate it) that all the "probability" testing for crashing in an airplane or getting in accident or falling off a building is fucking absurd: the only real test for "survival" is a 50-50 chance: either you walk out the door and die, or you walk out the door and live. It's pretty simple.
I'm not a math guy, but I think about Zappa's Law lot -- especially these days when everybody is citing statistics about the chances they'll lose money, the chances they'll go out of business, the chances Napster will cut their business by X% -- whatever.
The only thing Amazon is doing by conducting the tests -- and, yes, even by refuding the money in an *enormous* gesture of goodwill and humanitarian appreciation (this is sarcasm, for those so impaired) is saying: look, we're not offering the lowest price, we're offering a *price* -- and with our price, you can take it or leave.
As a competing business -- B&N, whatever -- I'd jump on this and say, "Look, we won't fuck around with your head or your pocketbook. We'll give you the lowest price. No games, etc. etc."
To me, that'll earn my business. I don't care about personalization (contrary to what Microsoft says I *should* care about), I don't care about targetted e-mail, targetted advertising (contrary to what *sigh* even my beloved TIVO thinks) I care about the lowest price.
How come none of these places are asking me, Joe Consumer, what really matters? How come they think that if they send me advertising "targetted" to my demographic that I'm gonna think, gee whiz, thanks for the e-mail! I'll get right on your site and buy something?
How come they don't think: okay, consumers are savvy, let's not muck around with all this personalization stuff, let's just give them the goods, give it to them cheap, and make it easy to return if they don't like it.
These fucking ad men (and women) are Microsoft drones. They'll buy the latest commerce site server and think they're doing everybody a favor.
Well fuck that. They don't do *everybody* a favor because I'm someone and I don't give a shit about all this stuff. I just want the lowest prices. I don't need a "web experience". I don't need videos and snazzy graphics. I want low prices.
Talk to me, you ad men and women. Talk to me, you market testers.
I'll tell you want I want, and what (I'd bet) a good chunk of consumers want. I don't want frills, I don't want flash (Macromedia -- or the more general kind) -- all I want is a little savings of both time and money.
That will make me smile. That will make me happy. And that will keep me coming back.
Dear potential Class Action Lawsuit participant,
Thank you for your recent purchase. As you are aware, our Market-droids recently came up a plan for ripping-off our customers without them being aware of it. As we are desperately out of touch with public opinion, and woefully ignorant of illegal trading practices, we decided to implement their plan. Unfortunately someone spotted this and we're now in some really deep shit.
In an effort to place some spin on this situation, we're refunding the money that we ripped you off for. Not only that, but we promise that if you notice us ripping you off in the future, we'll refund that money too.
We value your business and appreciate your trust; after all, without your complete and total trust we'd never have a hope of pulling off anything as underhanded as this. We hope that you will continue shopping with us. Really. We need your business, 'cos we're hemorrhaging cash faster than we can possibly hope to sustain and sooner or later our Venture Capitalists are going to notice.
Hugs and kisses, Amazon.con
P.S. You're not using any '1-Click' technology in any of your software, are you?
--
The gift of death metal does not smile on the good looking.
When you order something and pay with a credit card, the company is cannot legally "capture" the money until the item is ready to be shipped. In the mean time, they can place an authorization or hold on the money, but they don't get it until they've actually captured.
Because of this, Amazon will not have the money to invest, and while not losing money on the deal, are making less because they will be charged for reauthorizing the CC.
AFAIK, Amazon still has yet to show a profit, and has about a year's worth of vulture capital left. This is when the boycott will start to bite, when the free money starts running out.
Unfortunately, Amazon is still the City's (or Wall St for you septics) dotcom darling, and that will probably continue until the second round of VC funding; all the greedmongers will be creaming themselves to get in on the deal. Only if the cash runs out a second time will the time of reckoning come to pass.
I've never used Amazon for anything other than looking up the ISBN of a book, and won't until they drop their patent. So, is there any formal "stand up and be counted" site, somewhere where I can digitally sign my name and tell Bezos where he can put his one click patent? Because until Jazzy Jeff B and the Patent Abusers can show their shareholders "this is a list of people who will never buy anything from us. We drop our patent, and they will buy things from us. Our increased customer base will offset any losses if anyone uses the one click idea.", they are potentially opening themselves up to all sorts of legal trouble from shareholders trying it on with "due diligence" lawsuits...
Strong data typing is for those with weak minds.
Strong data typing is for those with weak minds.
To see what they could get for the certain product?
Hmmm. If the price on widgets is $4.99, 400 out of 500 people buy it that view it. If the price is set at $5.99, 325 people out of 500 buy it that view it.
Hmm, in the first instance, I get 1996.00 out of it.
Hmm, in the second instance, I get 1946.75 out of it.
This is the way I see it.
I take it as Amazon is fucking with me.
So guess what. I don't like being fucked with.
There's too many places to buy products and too much competition out there. I for one, will be taking my business elsewhere, even if I pay a buck more somewhere else. As a matter of fact, I will be not even trying Amazon in the future.
I will take this as a lesson learned.
The above post is an editorial, the poster cannot and will not be held responsible for all or in part for it's contents
That corporations cave in like a deck of cards whenever a few people start whining, bitching, and moaning. No one put a gun to these people's head and made them buy these people buy these products and they agreed to the price that they made the purchase for.
DrLunch.com The site that tells you what's for lunch!
Its a good site for finding DVD's at the lowest price, and they include special offers and coupon deals from Amazon.com, Buy.com, BN.com and others.
Executive ability is deciding quickly and getting someone else to do the work. --John G. Pollard
Are they encouraging us to gamble? Picture this: a DVD you really want is going for $30. If you thing there's a chance they may offer it to someone else for $25, that means you're gambling on a $5 refund somewhere. So maybe this is a way of luring people into paying full price on certain items in the hopes Amazon will adjust the price down and give you some money back.
Okay, conspiracies abound. But I know that if an online business came out and said "one out of every hundred purchasers will randomly receive a five dollar credit towards their next purchase," the gubment would go nuts.
--
This is not my sandwich.
If you're willing to pay what Amazon charges, then what do you have to complain about? If the deal you're getting isn't good enough, shop somewhere else. Last time I looked, I didn't see a "guaranteed to be the best price" slogan anywhere on their site so they have a right to charge you any price they damn well please. And if you don't like it, there's plenty of alternatives.
Ita erat quando hic adveni.
Perhaps I'm just cynical, but isn't this just a nice PR exercise by Amazon, along the lines of, "Oh hell, they spotted us, if we give them back their cash, perhaps they'll say we're still OK people, except for that one-click thing, anyway".
*shrug*
It could, of course, be completely genuine.
I noticed that Amazon.co.uk had reduced the price of an item that I'd pre-ordered, and emailed asking them to reflect the price change in my order, which they have done.
...if this was actually an 'experiment', or if they thought they could get away with it? With all the bad press they recieved over this, I would assume the later.
A few things:
a) capitalism. plain and simple. (go to school, take econ and finance...uhgg...)
b) ever heard of VIP? Valued Shopper discounts? Coupon/discount clubs? Frequent Flyer discounts? Car sales? SHOE STORES EVEN LET YOU BARTER! (I just found this out =)
But most importantly:
c) Ever heard of McDonalds? hmmm, if you have, then you'll notice that a cheeseburger in one location could be drastically cheaper in another McDonalds. Around the world, McDonalds' prices fluctuate BASED ON income levels.. ie, Cost of Living. So I guess we should demand equal burger prices?!?! (imagine: you sit in NY watching an ad for 25cent Burger, you fly to L.A. and have to pay 50cents! fine by me!) hmmph...
Listen people, but I have to point out, YOUR ARE ASSUMING the laws that protect you from something like this, but they don't. And they shouldn't. If and when I open a company, I will sell to you at a price I determine by how dumb a luck you have on your face and there is nothing you can do about it. simple. As long as it cannot be proven that it was Racial, Gender-based, or Religious biased. Even then, you better have some damn good proof... even with all the bleeding hearts around in the courts...
just my 2 cents...well, for some of you, 4...ill make the difference up later...
./Vanguard/rants/r_d_best -eVer
"I think, therefore I get paid."
Dear Amazon Customer:
Not only were we stupid to do the price adjustments, we're really sorry about patenting the mouse click. We were just kidding about that one. As soon as we run out of vulture capital, we will close our doors, shutdown our website, and donate the patent on the mouse click to the FSF.
Sincerly,
Jeff Bezos
--
then it comes to be that the soothing light at the end of your tunnel is just a freight train coming your way
then it comes to be that the soothing light at the end of your tunnel is just a freight train coming your way
As you may be aware, we occasionally test various aspects of our web site--design, layout, and other features--for brief periods to determine how they resonate with customers.
And I thought that ringing in my ears was from falling asleep with the headphones turned all the way up too many times.
Maybe next priceline will refund the difference between the price you agreed to pay for a ticket and the lowest price an airline was willing to sell it for. Oh, that would take away all their profits?
ok then your [sic] infringing on my copyright! Could you as [sic] me next time before STEALING my comments for your own?
This is just damage control; Amazon screwed up and people are pissed.
Given past behaviour, how can you trust them to tell you when they are running their "experiments".
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but I really hate these guys. I have a huge problem with the way retail business is done. I was completely unaware that these kinds of practices where not only leagal but generally accepted. Why should a store be aloud to change it's prices in such a manor. For example a bar (in Illinois I know laws differ) can not have a happy "hour" and then raise there prices after everyone is in and drinking. Isn't it really the same thing. A store manager sees that sales are really high on beanie babies today so we are going to raise the price 5 dollors during the slow down before lunch time. What the heck is up with that? Maybe I am missing something, after all it is there store they should be able to charge what ever they want but this is like price switching isn't it. I really hate this charge what the market will bare idea. What happend to charge a fare price, and be competitive with the other store. I guess when there is only two stores and all the little guys have been bought or crushed we don't get that any more. We get greedy people who can do pretty much what ever they want to the entire country. Ok, I am off the soap box. Be nice.
Suppose you're on top of the Empire State Building and want to get down to the sidewalk. You could either jump off (faster), or take the elevator down. They both have only two outcomes: You live or you die. Which do you choose?
If you chose the elevator, good for you: you understand why having two outcomes is not the same as having a 50-50 chance.
If you chose to jump, well, to quote Niven and Pournelle, "Think of it as evolution in action..."
It seems to me that most of the outcry over Amazon's pricing games comes from people in the US who are simply unaccustomed to the idea of bartering. I'm not saying that Amazon is a place to haggle for the best price, but when you take a group of people who are used to getting a fixed price (Americans) and combine that with a popular notion that everything needs to be "fair", I bet there will be problems.
Think about it. In the US there are 3 main "arenas" where you get to haggle for a better price: cars, flea markets, and garage/yard sales. That's it. You will never go to your local food store and aruge for a better price. Ever. Buying a car is the big one. And how many times do you hear people complaining about the car buying experience? For me, it's all the time. People hate it because they feel uncomfortable with the idea that the price isn't fixed.
This, of course, is all speculation. I wonder what the reaction would have been if this had taken place somewhere where bartering is an everyday experience.
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"Every artist is a cannibal, every poet is a thief."
Thats not why they shut Crazy Eddie down. This was a long time ago, but I remember it being something to the effect of "embezzlement" or "tax evasion". It has nothing to do with prices. If that was the case, no car dealership would be in business since they offer different prices on the same product every day.
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"Every artist is a cannibal, every poet is a thief."
Presumably you also object to:
Nobody has any reasonable expectation that the price they pay will be the same from moment-to-moment regardless of the circumstances under which they buy. Nobody claims there's a conspiracy when two gas stations in the same franchise several blocks from eachother charge different prices, or different franchises across the street from one another. (In fact, quite the opposite: people charge price fixing when there's too much uniformity of price.) That's precisely the reason that some retailers offer a price guarantee as a selling point ("If we lower the price within the next 30 days, we'll refund the difference!").
If the price changes were separated by days, or were explicitly linked to things like which physical store they went into, or membership in a particular organization, nobody would even blink. It's only because the changes were happening at online speeds with no particular promotional effort that anyone thinks otherwise.
Why are you "testing" whether you can get away with charging different people different prices?
If you're doing tests of your software, you do that internally. If you're doing that for marketing purposes, then you do it with focus groups. You don't treat your customer like a guinea pig.
And why test to see which discount level is accepted the most? We all know that people buy what is the lowest price, so whatever the lowest price you can give people is, is what they'll take.
If this was a test to see how subtly you could screw the customer, I propose a different test. How many people will click on http://www.noamazon.com and follow its advice over the whole 1-click and affiliate thing, as well as your latest interesting business practice?
--- Jump!! Fire!! Bullet time!! - Lego version of the Matrix
That got me thinking about automation...
If you could maintain a number of "fake" accounts, you could collect a lot of data, just by yourself. A small group of people with software designed to use multiple accounts (perhaps with a mix of IP-spoofing to keep the Amazon servers from getting wise) to collect a broad range of price quotes could do it. (Sorry for the convoluted syntax.)
As for the lawsuits... that's a tougher nut to crack...
--jrd
XML is like violence. If it doesn't solve your problem, you're not using enough of it. --AC
That link refers to an article NOT about the original issue. It's about a problem people are trying to relate to it. I see it as just another Amazon screwup. In the "testing" that was done, no one was charged a price they didn't agree to.
C'mon ppl. It's just business. Sure it doesn't make sense for them to be charging 2 different prices for the same item. So here are a couple of theories speculating as to why they did it:
1. They are trying to scam you and steal your money
2. They really are trying to do a marketing test
3. It was a fuck-up/type-o
OK, here are some responses to the above:
1. Amazon wouldn't try to scam anyone. First of all, they are refunding your money. Secondly, Amazon is too big to have to worry about all kinds of class action lawsuits against them. They don't want to scam you.
2. Sure, this actually makes sense. Amazon tries to figure out what prices best suit their products. If they sell at price A do they make more money than at price B, even though B is a higher price. They want to see if ppl are being turned away from their site because the prices are too high. So, they refund the difference, then later set their prices to reflect the research results.
3. I doubt it was a screw up. Why would only some ppl be charged less than others. I would think they are pulling from a single database, so prices are across the board. This prevents #1 from happening as well, so everything is fair.
But they still didn't have to do it. I really wonder what percentage of customers ever even heard about it? 1%? .1%? .01%? It's become a sport to find these "conspiracies" on Slashdot and Cnet.
4. Amazon.com is actually trying to make money so they can be actually make a profit and NOT constantly bleed red like they do currently.
Executive ability is deciding quickly and getting someone else to do the work. --John G. Pollard
but doesn't this invalidate any research they might want to do? Presumably they are trying to find out what the maximum price they can get people to pay is. So by saying this, in future people might see that the price is higher, but think its a test, and pay the higher price believing they will get a discount. You might choose to shop at Amazon for convenience (you already have an account set up, you don't at a rival), trust (you know that they will deliver because they delivered in the past) or any number of other reasons, and this last thing could swing the balance for you...
In other words... "Thank you for being a guinea pig at Amazon.com. We'd like to let you to know that if we conduct further tests in the future, you will be refunded the difference. Unfortunately we won't tell you when we've perfected this profit-optimisation system and implement it permanently, nor will we offer refunds. Of course, you still trust us, right? "
--
Computers are useless: they can only give you answers. -- Pablo Picasso
These prople pull their little pricing stunt and get caught. Now they reverse it and say were giving discounts. Their not-so-informed customers will say "Wow, aren't these guys great? They're giving me a refund I didn't ask for!"
These bastards are going to come out smelling like roses.
VENI! VIDI! VICI!
So you sit down at your table and the hostess hands you a menu. You decide that the pasta-and-salad combo for $12 sounds pretty good and place your order. Oh, and the restaurant offers free refills on your Coke, so when the check comes at the end of the meal, you're feeling satisfied.
But unbeknownst to you, the guy at the next table has a menu with different prices on it. In fact, he just ordered the same pasta combo for only $10. Hey, that means you've been ripped off, since somebody paid less for the same product than you did! Alert the media!
Frankly, I don't see what about this situation would make you feel cheated. If you made a choice based on the available information and were satisfied with that choice, why are you suddenly upset that somebody else got a better (or worse) deal? They, too, have the choice to take it or leave it -- nobody is forcing the pasta down their throat. Would you react the same if the menu prices had been the same, but the guy at the next table happened to have a $2-off coupon that he picked up on the street corner before walking into the restaurant? He got a different price than you did, for no reason other than that he happened to pick up the flyer somebody shoved at him as he walked down the street; would that be "unfair"?
Presumably a business does testing like this in order to maximize its revenue and/or profit. I know /.ers like to denounce evil corporations, but it's rather shortsighted not to acknowledge that businesses small and large are in fact responsible for many of the things we all enjoy in life. That doesn't mean we have to love all businesses, just realize that they're not all out to shaft us. If the information the restaurant gleans from this pricing experiment means it can hit a pricing sweet spot that allows it to give out free Coke refills -- or on a more fundamental level, simply stay in business -- is that necessarily a bad thing?
Now, I'm not about to argue that doing this kind of experiment is a always smart business decision, because we all know that perception is more important than reality. If you piss off your customers -- whether you think what you're doing is "logical" or "justifiable" or not -- that probably, in the end, costs you more than just giving everybody a uniformly low price. But I figure it's your decision to make, and it's customers' decision to take it or leave it now and in the future. Any voluntary transaction between two parties implies that both got something more than what they gave away: You valued the food more than the equivalent amount of money, and the restaurant valued your money more than an equivalent amount of (perishable, unprepared) food, so shouldn't you both be satisfied?
Of course, I should point out a couple of places where the "it's all OK, as long as the buyer and seller agree" model clearly breaks down:
- When no meaningful competition exists. If this is the only restaurant in a 100-mile radius, and all the markets are closed, then you don't really have a choice about whether you eat there or not. I'll readily admit that you can be treated unfairly if you are under duress.
- Where people are given prices based on their personal characteristics rather than their behavior. For example, it would be unethical -- and illegal -- to systematically charge black patrons a higher price than white ones.
- I'm sure there are others. I'm no economist.
Maybe our obsession with fixed prices is, historically speaking, an anomaly. After all, it was only pretty recently that mass production and distribution enabled supermarkets, with their little price tags on every item, etc. Historically the bazaar/barter/haggle model seems much more commonplace.Incidentally, my most jarring firsthand experience with bizarre pricing structure was when I called a travel agent to order plane tickets for a vacation for my girlfriend and myself. The travel agent said "The ticket price is $325 each, round-trip." Then she added, "Oh, wait. That's the price for one ticket. The second ticket is $425." I travel a lot and I'm used to pricing disparities between seats, but it was a real shocker that two tickets ordered by the same person at the same time could differ in price by $100. But hey, it cost what it cost, and if we didn't like the price we would've found another destination, or an alternative way to get there.
"Biped! Good cranial development. Evidently considerable human ancestry."
= When it's NOT a test, we'll fuck ya.
-Jon
this is my sig.
Perhaps the Michigan Attorney General should be looking into this.
Dave
By the way, if anyone in the /. community knows of an active list, let us all know so that we can sign there as well.
...Open Source isn't the only answer -- but it's almost always a better value than the alternatives...
Make sure to tell Amazon how you fell about their "experiment". Send an e-mail to feedback@amazon.com. I did. I don't feel any better, but I did inform them that I will no longer be shopping on their website. I have spent more than $1000.00 there this year.
Eagles soar, but Weasels aren't sucked into jet engines.
Very interesting post. But how come Buy.com and BarnesandNoble.com haven't taken advantage of this latest uproar of an Amazon policy. If I was ecommerce director of either competitor, I would have links to the CNet article on the front page of my website. Not only that, but price comparision search engines (PriceScan MySimon PriceWatch DealTime Shopper) should be having a field day with this!
Perhaps Buy and Barnes & Noble are conducting the SAME experiment but at a more discreet level?!?!
Rangers Lead the Way!
Allow me to reiterate what has been said.
Correct me if I'm wrong, but there's a slight conflict between points 2 and 4. Once these people have paid the said amount it becomes their problem. It's not Amazon being big and evil, it's people being stupid. And you'll find that the majority of posts so far have pointed this out. People aren't getting on Amazons case, their getting on peoples case for being stupid enough to pay the infalted prices.
If you're gonna complain, at least make it a valid point
Why is it Amazon can pull something like this and just walk away from it? Saying "whoops" were sorry... "tee hee our mistake"???
To Someone getting a refund because they were overcharged on error: Good for you. Next time price shop and assure your not being victimized. Consider yourself lucky.
To Someone who is being refused their product because the price was wrong in Amazon's systems: Stick to your guns. Get your product at your agreed upon price. IANALTFG (Iamnotalwayerthankfuckinggod) BUT: You have a contract (signed when they sold the product at price X) and now they say they wont supply. Its not your problem.. it's theirs; and I guess they should be more careful next time. What do you care if the price they are selling the product as is a 'loss'... when did corporate profit become a social pillar...? Some sort of corporatists right...?
Oh yeah - when US Democracy was bought and sold to the corporate state.
Another case of Corporation gets 'its cake and eat it too' and a citizen gets 'the shaft'.
Um, but you're wrong. Ever heard of movie tickets costing different amounts for children and seniors than for adults? It happens all the time. And it's not illegal.
Oh wait, I guess that wouldn't sound so evil, and therefore wouldn't stir up the masses quite as much. Great job on presenting the news in a properly slanted way, slashdot! Thanks!
I guess, fundamentaly you are correct. The companys have the right to charge whatever they want for items, and charge different people different amounts. As long as they TELL customers they are doing it. Isn't there a law about this somewhere?
By the way, customers also have the right to shop elsewhere, or not use open source software. The greatest freedom is the right to choose.
Eagles soar, but Weasels aren't sucked into jet engines.
People agreed to buy an item at a price. Why should Amazon apologize? I don't have to give the same price to everyone on items I sell. I think it's very admirable what they are doing by refunding the difference.
This is all they can do to save face
According to the Register, Amazon has had some other problems with pricing as well...seems they offered DVDs at one price and then refused to sell unless the customer paid a higher price.
Even worse, they have absolved themselves from all responsibility for a customer's privacy.
See http://www.theregister.co.uk/content/1/13210.html for details.
Any doctrine that weakens personal responsibility for judgement or action helps create a climate that welcomes an
Raising prices? OH NO! Higher prices aren't really a good thing, but it isn't some crime. They didn't tell the consumer one price and then charge another. People saw what they were going to pay!
And in the meantime, while they have your money, they can invest it. Then, when THEY consider the 'experiment' over, they can give you a refund.
More seriously, that's an integral part of some financial institutions revenue. Ever wondered why banks process charges to your accounts way faster than they process deposits ? Even taking the necessary communication between banks (after all the money has to come from somewhere) doesn't satisfactorily explain the two to three (business) days difference I have observed in some cases.
Sure, over a few dollars it doesn't make a difference, but even a couple of days' worth of interest can add up for a bank.