Online Shoppers Naive About Online Prices

smooth wombat writes "Have you ever been shopping online and noticed the difference in prices for the same item at different stores? Do you realize that not only are the prices different from store to store but they could be different for you compared to someone else who shops at the same store? Nearly 2/3 of adult internet shoppers thought that practice was illegal according to a study (pdf format) conducted by the Annenberg Public Policy Center of the University of Pennsylvania. First-time buyers at a retailer could see higher prices than a firm's repeat customers, and retailers may not offer discounts to consumers who buy the same brands regularly without even looking at alternative products on the same site. From the article: 'The Annenberg study was based on results from a telephone survey from Feb. 8 to March 14 of 1,500 adults who said they had used the Internet within the past 30 days. The margin of sampling error was reported to be plus or minus 2.51 percentage points.'"

Comments

and it goes on

[gaylenek]

data mining that is...I'm surprised it took humanity as a whole to realize this.

Re:and it goes on

[Xiaran]

Indeed. If find this particularly disturbing.

More than two-thirds of people surveyed also said they believed online travel sites are required by law to offer the lowest airline prices possible.

NEWS FLASH!
Companies like making as much profit as possible! Film at 11. Also in the news... 2/3 of people are apparently very naive and stupid.

Re:and it goes on

[Anonymous Coward]

Only 2/3? I would've guessed that number would be considerably higher, like 4/6 or 8/12 or something...

Re:and it goes on

[antifoidulus]

You mean to tell me that everyone doing business on the internet is not Honest?

Interesting coming from someone with a free iPod ponzi scheme ad in their sig....

Re:and it goes on

[Anonymous Coward]

Only 2/3? I would've guessed that number would be considerably higher, like 4/6 or 8/12 or something...

Well it could be worse. It used to be 66%, so things are improving.

Re:and it goes on

[caseydk]

Yeah, this isn't new at all. It's call Price Segmentation.

This is why movie theatres charge less at Noon than at 7pm. People are less likely to sit in a dark theatre in the afternoon as opposed to an evening.

This is why there are senior citizen and student discounts at so many places. These people are more sensitive to prices that someone working fulltime, so companies cater.

I think the /. community needs an Econ 101 lesson.

Re:and it goes on

[Registered Coward v2]

Only 2/3? I would've guessed that number would be considerably higher, like 4/6 or 8/12 or something...

Heh - I'd guess 13/12 or so...

Just goes to show, as one writer put it, you can never go broke underestimating the intelligence of the American public

Re:and it goes on

[nmx]

Well it could be worse. It used to be 66%, so things are improving.

Not really; 2/3 is higher than 66%.

Re:and it goes on

[panaceaa]

How many Library of Congresses is that?

Re:and it goes on

[wealthychef]

If the question is worded this way, it sounds like it's referring to sites like Priceline.com. I believe as part of their advertising they regularly claim they are there to find you the lowest price possible. I think it is illegal to make false statements about the nature of your product, so maybe people aren't as stupid as some slashdotters seem to think. The question arises as to the meaning of "possible" in the above sentence as well.

Re:and it goes on

[mdecarle]

Yep. I have a online shop, and this is included in the -popular, and readily available- software.

Everyone sees the same prices, but a returning customer logs in, and gets *his* prices. I can actually give everyone his own special prices, or free shipping, or other payment methods. Of course, there's also Sales Tax for some and not for others.

Re:and it goes on

[eclipse500]

There's nothing illegal about it, it's CRM, companies use it all the time, anyone carry a Kroger card? What do you really think Kroger does with all that data. They know what you buy when you buy it and tune their offers accrodingly, personalized offers...

Re:and it goes on

[zerbot]

Hah! I've never been able to get a cheaper price on Priceline than I could by booking straight from the airline. I wondered how Priceline could stay in business that way, and I guess now I know.

Re:and it goes on

[bleckywelcky]

Despite what you may think, 2/3, 4/6, and 8/12 are actually different numbers.

Re:and it goes on

[Xiaran]

If only Heaviside had a slashdot account. And was... you know. Like alive. The discussions we could have!
Anyway. Thanks for suddenly taking me back to Calc 1 at my first year of uni :)

Re:and it goes on

[geekoid]

"They know what you buy when you buy it and tune their offers accrodingly, personalized offers..."

yes, offers, but they don't change the price on something you bought at the time of purchase. they make you an offer first, say send you a coupon, and then you decide if you want to use it.
It's something else entirly when the raise the price on you without you knowing. Or give a discount because you are from 'there section of town'.

Re:and it goes on

[AaronStJ]

To be fair, the free iPod ponzi scheme is annoying, but there's nothing dishonest about it, really. They explain what you have to do to get the iPod, and you really do get a "free" iPod. I have a couple of friends who got iPods this way, without a problem.

Distasteful, yes. But it's hard to call dishonest.

Does this happen much?

[TwistedSquare]

How prevalent is this practice? It would be pretty silly to say I've never noticed it (it's hard for one person to check this by themselves), but I was certainly not aware that it happened.

Re:Does this happen much?

[macrom]

I think it is fairly prevalent, which is why sites like http://www.bensbargains.net/ exist. An example I found a couple of years ago : I ordered a flat panel from Dell. When I shopped on their "Home User" site, I got a price that was $300 more than if I put in some bogus corporation name and shopped the "Small Business" site. Guess which one I ended up using? To me, it is repugnant that I had to even go through all of those steps. Volume deals for corporate customers I can understand, but blatant price discrepancies just because you browse a site differently than another single customer is bad business. I don't know if I would consider it illegal, but it is definitely unethical.

Then again, so is lying to get a better deal on computer hardware. :^)

Re:Does this happen much?

[DrEldarion]

I've never noticed it either, and I deal with prices for around 4-5 hours daily. The "deals community" would notice pretty quickly if something like that were the case.

So if it does happen, it's not at any stores that are worth shopping at.

Re:Does this happen much?

[BK425]

Huh? Variable pricing is very well known, there have been stories here on /. about it before. Go google

amazon "variable pricing"

and see... You didn't think they were custom assembling those web pages only to get you to buy more? It's been common practice with internet sellers for years. BoydK425

Re:Does this happen much?

[elgatozorbas]

When I shopped on their "Home User" site, I got a price that was $300 more than if I put in some bogus corporation name and shopped the "Small Business" site. Guess which one I ended up using? To me, it is repugnant that I had to even go through all of those steps. Volume deals for corporate customers I can understand, but blatant price discrepancies just because you browse a site differently than another single customer is bad business

"just because you browse a site differently"="just because you lie to them".

Re:Does this happen much?

[DrEldarion]

This is talking about something completely different, though. Dell SB and Dell Home are pretty much run separately, so any deals in one do not carry over to the other. A lot of the times Dell Home is less expensive as well with all the coupon codes they send out (just a few weeks ago the 20" 2005FPW LCd was around $350).

Either way, though, that's not what the article is talking about - what they're saying is that given the same product on the same page on the same site, two different consumers may see two different prices. Knowing of different discounts is one thing, but I have never noticed that to be the case. The only time I've ever even heard of something like that is when Amazon does "periodic price testing" on some items (usually media), and even though I'm on Amazon many times daily, I've never noticed this.

Re:Does this happen much?

[peragrin]

Daily.

It's been going on for Decades. The internet has ony made it visiable to end consumers.

Ask any retail/wholesale warehouse. Where I work we have 6 primary levels of pricing. The last two are never touched. they are cost plus 10% and cost plus 20% and are used as pricing markers. The others vary depending on product, with 10 different discount matrices dealing with a percentage off a predetermined price.

Consumer who walks in and buys a once gets one price.

Business who walks in and buys once a year with a tax exempt form gets another.

Business/or person who have a charge account gets a different level.

Business/person who s in the store buying monthly gets the best pricing.

Some items this doesn't work for, others we can't make 5% on to stay competitive.

A business needs a lot of sales to make enough to stay in business. But discounts to large buyers(or buyers you hope to lure back) isn't un heard of. If your just realizing this, I have to wonder about the educational system. This goes back for a long time. Most of the time it isn't spoken about to everybody. of course anyone who goes to stores with local charge accounts have heard about it.

Re:Does this happen much?

[Geek_3.3]

Dell is the worst when it comes to pricing differentials! I helped out a collegue with some of her computing purchases and they had to go through Dell due to a supposed state 'deal.' Personally, I could have easily put together the computers we made through the Dell Home site for well under $1K for personal purchases. No coupons, no fatwallet tricks--just what deals they had that day. Imagine my surprise when the same configuration was ~$1450 on the Dell contract site!

Some deal! I won't go so far as to say it's "illegal," but I would say that perhaps large institutions should look into these phantom 'deals' from large manufacturers like Dell. Is whatever ease of buerocracy of having a state contract really worth a 40% price differential?

Re:Does this happen much?

[caseydk]

Sometimes those deals come with support deals too.

One of my clients has a support contract with them and they're amazing. I had a 19" LCD die on me at 2:30 in the afternoon. We called them by 3pm and requested the new one.

By 10am the next morning, we had a new one along with the shipping label to send back the old one in the box. It's pretty impressive.

Re:Does this happen much?

[AlienWorker]

First, it is completely OK for individuals to order from the Dell Small Business site. You can just use your full name as the "company" name, instead of making up any bogus company names.

I have ordered many times through the small business site. So did many people I know. I once asked the Dell sales rep assigned to the company I work with. The answer is exactly what I said above.

The Home site and the Small Business site, as well as other ones, are ran by different business units, which are independent of each other. They come up with their pricing, services terms and promotions.

Re:Does this happen much?

[DrEldarion]

I visit Amazon MANY times a day, have bought many hundreds of items between them, and verify a lot of pricing that many other people have seen. Never once have I seen a discrepancy between what someone else has seen and what I (or anyone else) sees. I've heard that a couple people may or may not have seen different prices on a few DVDs when Amazon was doing price testing, but the reason for that didn't have anything to do with the consumers themselves, but just because Amazon wanted to see what price people would buy things at. They do change their prices quite often, but I've never seen a difference from person to person besides the aforementioned price testing - if one person saw it, everybody saw it. If you have any proof of this, I'd be very interested.

Dell is a different story because Dell SB and Dell Home price their items as though they're completely unrelated. Even if they DID give SB customers lower prices on purpose (and note, they aren't always cheaper), though, companies have been giving businesses lower prices forever. If you're a landscaper, chances are you can get a discount at landscape shops. Businesses can get hookups at computer parts companies to buy things for cheaper. Offering different prices to businesses as opposed to the consumer price is a pretty standard practice that has been going on for much longer than e-commerce has been around.

The difference between business pricing and consumer pricing isn't what the article is talking about, though. They're talking about a difference from consumer to consumer just because one person has shopped there before or not.

Re:Does this happen much?

[Chanc_Gorkon]

Yes but he's ordering 1 flat panel monitor. Many companies order 1 of a item and get a discount because they are a company and the thing is that there should only BE one site. 1 for EVERYONE. This B2B and B2C crap is, well, crap. Almost every item a business could need could be needed by a single person. I can see it if it was liquor and the state law said you had to have a liquor license or something to buy it...I can see if you were trying to buy chemicals or refrigerant, but not for a flat panel monitor. Individuals buying a single item should get the same price as companie sbuying a individual item. I can understand discounting bulk purchases but that can be done for single consumers too(what if I hit the lotto and wanted to buy my church 100 pc's?). All I am asking for is a fair price. I should no thave to jump through hoops to get it. Like them damn grocery cards.....

Re:Does this happen much?

[ThosLives]

Well, I think the big thing here is that in some cultures this weird idea of "one price for everyone, I take it or leave it" and in others there is the haggling mindset - the truest free market. For instance, there is no law that says you have to agree on a price; you could probably try to go haggle with the wal-mart manager but he'll probably say "no, if you don't want to pay what's on the sticker, then I won't sell it to you" but you can probably go into a specialty shop and haggle a couple bucks off things.

Some states have laws that a price must be displayed on an item, but there is no law that says that you can't pay less than that price (I think there are laws that say you don't have to pay more, assuming the label is for that item and not a "swapped" label).

That's why the whole concept is called "shopping" anyway - you look for the thing that you want at the price you're willing to pay. If you're willing to pay $100 to site A, then it's not site A's fault that you didn't go to Site B where they had it for $90.

This sounds like people not wanting to be responsible for their purchases. Gotta be careful there, giving up that responsibility...

Re:Does this happen much?

[cbr2702]

Companies in general are better customers, so it makes sense to court them. They tend to have in-house support so you have fewer clueless people calling vendor tech support. And while they may only be ordering one monitor now, they usually have a lot more to buy than the avearage home user and so getting and keeping their business is worth more.

Re:Does this happen much?

[pete6677]

If Dell wants to play games with pricing, I say there's nothing wrong with playing. You the consumer can be manipulative as well. Sometimes they'll win, and sometimes they'll lose, that's the nature of dynamic pricing. There's nothing unethical about it.

Re:Does this happen much?

[mcmonkey]

I visit Amazon MANY times a day, have bought many hundreds of items between them, and verify a lot of pricing that many other people have seen. Never once have I seen a discrepancy between what someone else has seen and what I (or anyone else) sees. I've heard that a couple people may or may not have seen different prices on a few DVDs when Amazon was doing price testing, but the reason for that didn't have anything to do with the consumers themselves, but just because Amazon wanted to see what price people would buy things at. They do change their prices quite often, but I've never seen a difference from person to person besides the aforementioned price testing - if one person saw it, everybody saw it. If you have any proof of this, I'd be very interested.

Maybe they stopped doing this, or toned it down to a large extent, but this is not a new story.
Amazon charging different prices on some DVDs

Which Price is Right?
Same Part, Same Supplier, Different Prices

I'm not surprised this is happens (especially price differences between online and brick stores (why not? a large chain like walmart or target will have difference prices across the country)), I'm not surpised most people don't expect this, but I would think the folks around here would accept as given this is the way these companies do busniness. (I'm not saying necessary accept as okay, just accept that they do it.)

The news here is not the business practice, the news is a study on few people know about it.

Re:Does this happen much?

[badasscat]

If Dell wants to play games with pricing, I say there's nothing wrong with playing. You the consumer can be manipulative as well. Sometimes they'll win, and sometimes they'll lose, that's the nature of dynamic pricing. There's nothing unethical about it.

I guess you've never heard the phrase "two wrongs don't make a right".

I don't even think what Dell is doing is necessarily wrong, but what you are doing (lying) most certainly is. You could pretty successfully argue that Dell pricing products differently for business vs. consumers is simply a strategy related to volume... i.e. a consumer is likely to buy one monitor and stop there, whereas a business is likely to buy one monitor to test it out, then buy 100 more if the price is right. This is nothing specific to the internet; retailers have done this for probably centuries, both online and off.

Lying about being a business to get the best price, though... how do you figure that's ethical? Sounds like a rationalization to me. You could lie about who you are all the way through life to get special favors - there are various names for people who do that, from "identity thieves" to "con artists."

Re:Does this happen much?

[aquabat]

Of course even though one new where Heisenburg was in 1941 you could never tell what direction he was taking at that time.

groan...

Re:Does this happen much?

[pizzaman100]

Who says it has to be a lie?

Almost everyone either runs a little business on the side or at least knows someone who does. I sell a few items a year on ebay, why not not buy the item from Dell for my ebay 'small business'?

Re:Does this happen much?

[pete6677]

It's more of a defensive strategy. If you're not willing to tell the occaisional little lie to get a better price, get used to being ripped off, because a vendor will sure as hell lie to you. Ever told a car dealer you will only pay up to $25,000? Was it a lie, would you have paid more if necessary, probably so. Falsifying certain information would be criminal if it involves ripping off the merchant, like fake credit cards or something, but as far as your motivation as a customer, it's a game. The dealer is trying to size you up and determine how much they can get you to pay, and you're trying to determine how little they'll sell for. Salesmen both tell and expect certain little lies, so play along with no ethical qualms, or choose to get ripped off.

Re:Does this happen much?

[pizzaman100]

you could probably try to go haggle with the wal-mart manager but he'll probably say "no, if you don't want to pay what's on the sticker

It is possible to negotiate with the wal-mart manager in certain cases - particularly on items with new packaging, or seasonal items at the end of the season, or on clearance/red tag marked items. This is stuff they want to get rid of to clear their shelves, and they are more willing to move on price.

Another good place to negotiate is the furniture store - particularly if you can walk in and pay cash. They typically price their items with some of their costs to offer financing. If you pay cash up front they will come down.

Re:Does this happen much?

[KtHM]

They tend to have in-house support so you have fewer clueless people calling vendor tech support.

So then, all of us geeks should get discounts. We're not going to be calling tech support. :)

Re:Does this happen much?

[bskin]

How prevalent is this practice? It would be pretty silly to say I've never noticed it (it's hard for one person to check this by themselves), but I was certainly not aware that it happened.

Hard to say for the online world, but price discrimination is common...you just probably don't recognize it. Different groups tend to be willing to pay different prices. For example, the types of people who clip coupons tend to be more bargain-conscious...and have you ever seen someone offer a discount with a student id?

Re:Does this happen much?

[zCyl]

An example I found a couple of years ago : I ordered a flat panel from Dell. When I shopped on their "Home User" site, I got a price that was $300 more than if I put in some bogus corporation name and shopped the "Small Business" site.

So thwart them and everyone else who uses a similar tactic. Check fatwallet.org before making any such purpose, and you'll see all those tactics listed out for you, guaranteeing you the low price.

Re:Does this happen much?

[cayenne8]

"All I am asking for is a fair price. I should no thave to jump through hoops to get it. Like them damn grocery cards....."

Well, I guess the main thing is...you can choose not to do business with them any longer. Find a store that give you one price only.

This kind of thing is common. In the real world...like buying a car. You have to research, figure out the amount you should pay, and bargain with the car dealers...get them to bid based on quotes from another dealer...etc. Getting the best price on things is often a negotiation, which while being a pain in the ass...is what is necessary to get the best deal for yourself.

Re:Does this happen much?

[russotto]

No lying involved. Dell's "small business site" is for companies with as few as one employee. A person doing business as a sole proprietorship technically qualifies.

I don't think Dell is being deceptive, though. They just have different departments managing the promotions for small business and home, which probably don't coordinate things all that well.

Sites which actually give different prices depending on whether your referrer is a price-comparison site, now that's pretty deceptive.

Re:Does this happen much?

[cbr2702]

It would be interesting if vendors let you purchase items without tech support.

Re:Does this happen much?

[corian]

I ordered a flat panel from Dell. When I shopped on their "Home User" site, I got a price that was $300 more than if I put in some bogus corporation name and shopped the "Small Business" site

Yes, but were you getting the same support contract?

Re:Does this happen much?

[Presidential]

Would that I had a mod point to give you for +1 informative.

I had no idea such sites like that were out there. I get most electronics via employee purchase/discount, so had never thought to look for the down-low cheapest price.

Thanks!

Old School Business Practices

[Stanistani]

"But for you, my friend - half price!"
(Hides price tag)

Re:Old School Business Practices

[mcmonkey]

"Ah, for special friends of Rick's we have a special discount."

Re:Old School Business Practices

[wild_berry]

That's exactly the point. Mankind used to barter all the time to get the best prices, and there remain shops that will do you a deal if you so ask. (The history I have heard is that morally-upright Quakers* insisted on people paying the price that they asked -- so there was no duplicity in their speech. This became the standard mode of practice for most shopping transactions.) Perhaps we will return to bargaining...

*: The Religious Society of Friends (Quakers) sect within the Christian tradition who meet in silence, not the Shakers who didn't breed and so died out or the Amish who don't have anything technological.

Froogle

[anandpur]

What, if Google is so famous then people should be aware of Froogle. It is on home page.
BTW here is the URL for poor souls (who pay higher price to e-retailers)http://froogle.google.com/

Re:Froogle

[drunkennewfiemidget]

Absolutely agreed. I can't even begin to count the number of times a friend has come back from an online purchase, and ebay purchase, (and even some brick & mortar purchases) all impressed with the deal they got, and my search on froogle brings up the same item for significantly less than they paid for it.

http://www.froogle.com/ is your friend.

Re:Froogle

[loganjw]

I too have used Froogle many times, but it isn't the one stop shop for all your low price needs. I'd say about 20% of the time I've found items cheaper elsewhere than what Froogle thinks is the lowest price. I believe that lowest price searching is dependent upon the type item you are searching for. For instance, if you want to search for college textbooks I've found that www.campusi.com does a damn good job of finding those really low prices. I'm sure everyone (well, everyone in the know) has their own methods of mining out that low price from the web, but just don't leave it to Froogle to do it all for you.

Re:Froogle

[STrinity]

Froogle's okay, but specialized sites like DVD Price Search are better since you can view multiple items at a time in a spread-sheet style.

This goes on already

[ColonelKernel]

in traditional retailing outlets. For example, between my parents and myself, we have bought our last eleven cars from the same dealer. Recently a friend of mine bought the exact same car as mine (save the color) and paid almost $900 dollars more than I did.

Re:This goes on already

[aspeno]

And all I can ask myself is, "wtf, who needs eleven cars?" If you're burning through them that quickly, I have to wonder who really is getting the better deal here.

Re:This goes on already

[StarWreck]

$900 isn't a significant price difference unless its a used car. Depending on your negotiating skills, the price of a car may differ by a few thousand dollars for a brand new car at a dealership.

Re:This goes on already

[kannibal_klown]

And all I can ask myself is, "wtf, who needs eleven cars?"

Well, there's him and his 2 parents. That makes 3 people. While I wait until my car is a heap of rust, I know some people that replace their car every 5 years just so tehy don't have to worry about heavier maintenance down the line.

His mom and dad could have been buying cars before he was old enough to drive (or even born) from a particular dealer. On top of which, they may have each needed a car.

So, let's say said person is now 22, and he decided to buy his second car from that same dealer (his first car being of the "used" variety because it was his starter-car) and he now wants a new/reliable car to drive him to his new full-time job.

Kid = 2 cars
Mom = 4 cars
Dad = 5 cars

5 x 5 years = 25
Meaning they could have been buying cars there for 20 or 25 years.

Heck, if he has an older brother or grandparents that also shopped there the number becomes even more realistic.

I admit I'm one of those

[Awperator]

CNN ran this yesterday as well. Kinda sleazy, but hey, it's business, and hey have to make a profit as well. Also, I admit I'm one of those who doesnt really check out prices that well before I purchase online. I usually make sure that I cant get it cheaper in town, and if that's the case, the first lowest price online that I see (including shipping) is mine!

I love the interweb

[l33t-gu3lph1t3]

What an awesome scheme. If the shopper doesn't demand a bargain, why offer one? The saavy shoppers find the good deals, and the unsaavy ones help the economy a bit more ;)

So people who buy with no thought to price

[Colin Smith]

Get fleeced. Well, Doh!

Let that be a lesson to all the brand junkies.

Be informed

[jchawk]

This is why you should use deal sites such as -

Rage3d.com/deals
Slickdeals.net
Pricewatch.com
Pricegrabber.com
Froogle.google.com

They keep you informed about the latest and greatest deals as well as allowing you to comparison shop the item you are looking for.

Also don't be afraid to look at popular sites like ebay.com, half.com and amazon.com. A lot of times you can find a private retailer through amazon that will sell you a used copy of the book / movie / cd / DVD that you are looking for at 50% or better off the new price.

It's not hard to make informed decisions online if you refrain from impulse buying and do a little bit of research.

Re:Be informed

[thetejon]

And those who value their time more than the money they save by looking at those sites can pay a bit more. I don't see anything wrong with this. If a consumer is willing to pay $100 for item X, then he will buy it. If not, he won't. If he still really wants it, maybe he'll do some research, and maybe find it for $90, and then buy it. But for some people, that time spent researching is worth more than the $10 they could save, and they won't do it.

Nowhere is it written that retailers must sell at the lowest possible price to every customer, and that's the way it should be.

Re:Be informed

[dafz1]

Also add:

Bizrate.com
Mysimon.com

Also, always look through the clearance areas. The biggest secret is refurbished products. Most electronics/computer companies have refurbs. I bought my wife's Powerbook as a refurb, which was cheaper than the same machine new, from Apple, with the student discount. Refurb units usually have the same warranty as a regular new unit, but have been checked to verify they work before they are sent to the customer.

Re:Be informed

[Skye16]

I've bought two monitors that were refurb a few years back - both died within 2 years (the first died in less than 6 months!)

I'd rather avoid refurb, thanks. I'm glad it's working out for you, but I got burnt twice and I don't want to put 200$ down just for it to happen again.

this practice

[hsmith]

is as old as time. why are people suprised? it amazes me the lack of education people have when it comes to worldly knowledge.

the nice thing about the internet is it does not discriminate to whom it gives the discounts to, as long as you fit the "revisit" criteria

Re:this practice

[Austerity Empowers]

A good counterscheme then should be for people to publish methods of achieve these "revisit" criteria without actually being good customers.

Oh but then I think online retailers would scream bloody murder.

Re:this practice

[gstoddart]

is as old as time. why are people suprised? it amazes me the lack of education people have when it comes to worldly knowledge.

Because the vast majority of North Americans are used to the mall-retail shopping model where there is a single posted price, and there is no haggling.

Another store may have a different price, and corporate/bulk purchases may have another.

They're simply just not exposed to the variable-by-customer pricing model.

Really? I don't believe it.

[ylikone]

I have multiple computers in my home and use the primary one to make online purchases, yet I have never noticed a price discrepancy when browsing the same items at the same online shops using my other computers.

Somebody please provide a sample site that does this.

outrage!

[0110011001110101]

What you say!?! Because I'm shopping on the internet they are keeping track of my visits and offering me different pricing levels based on how often I come back and how much I buy?!?

This is an outrage! I'm pissed off! I'm writing congress... but it will have to wait until after lunch... I'm going to see my favorite waitress Lisa down at the local burger shop.. she never charges me for my milkshakes cause I'm there every week...

ohh.. shit!

Re:outrage!

[Jurph]

Put me in your camp -- I bought an engagement ring from a jeweler and have asked several friends of mine to at least stop by and browse because I was so happy with their service and flexibility. I went back to get some items engraved for my groomsmen, and even though they don't normally send items bought elsewhere for engraving, they sent my gifts out, got them engraved, and when I came to pick them up, was told that there wouldn't be a charge.

There's a reason that this is an old practice: it works. Let some schmoe off the street pay retail if he doesn't want to shop around. I told them up front what I'd seen elsewhere, and they decided they wanted my business enough to offer me a nicer ring at a lower price (and yes, "nicer" is my opinion -- but it was also my money).

I enjoy investing a little time to find low prices; others choose not to invest their time in price-hunting and pay a premium for their convenience.

Re:outrage!

[Jurph]

I'm pretty sure you meant for this one to be posted after the Spam Zombies in Europe post.

Re:outrage!

[Shajenko42]

I've seen a number of posts that were inappropriate for this story but possibly appropriate for others (quite a lot on the GPL). At first I thought it was someone trolling, but after I'd seen so many, I started to think that there might be a problem on the Slashdot servers.

Most online shoppers simply niave....

[jsimon12]

I would argue most online shoppers don't know pricing period, I can't count how many eBay auctions I have seen where the items go for more then retail. Not to mention how many online stores are selling for more then retail.

Re:Most online shoppers simply niave....

[smooth wombat]

I have to wholeheartedly agree with your comment about eBay. Just last week I was looking at an eyecup for a camera. The seller had the original box with the price sticker on it which said $13.00.

The eyecup eventually went for $14 plus shipping.

This wasn't the first time I had seen something with the original sticker on it go for more than what it originally cost.

I would love to see how much debt these kind of people are in since they apparently don't care how much they pay for something.

Re:Most online shoppers simply niave....

[LurkerXXX]

Most of the time yes, this is boneheaded shopping. But don't forget that for a small percentage of the time, folks may be looking for a very specific discontinued item that is no longer available through retail outlets, even at the lower original price. In other cases, the item may just be rare and hard to find. That being said, I've never actually bought anything off Ebay myself.

Re:Most online shoppers simply niave....

[Chanc_Gorkon]

This is the case. My example would be memory upgrades for the eMate 300 I just bought as well as the serial cable. I have seen prices on the cable as low as 8 bucks and as high as 15. The memory upgrade is priced around 100. We are talking about a 4 MB chip. I would pay around 80-100.

Re:Most online shoppers simply niave....

[jsimon12]

But don't forget that for a small percentage of the time, folks may be looking for a very specific discontinued item that is no longer available through retail outlets, even at the lower original price.

I am aware of the hard to find items being more expensive then the orginal cost. But I was refering to new items still in stores. Try searching for solar panels on eBay, the prices are almost always higher then what you could go to google search for and purchase the exact same panel.

Re:Most online shoppers simply niave....

[LurkerXXX]

I'm aware people often do this, that's why I said "Most of the time yes, this is boneheaded shopping". I was pointing out that occasionally it wasn't. There was nothing in your original comment about limiting the comment to items that are still currently commonly available for the lower price.

The Euphemism is: Price Customization

[DanielMarkham]

Sounds like an extra feature, eh?

"Price Customization! Just for you!"

They ran this story on our local TV news last night. If I understood the reporter, it sounded like vendors were "customizing" the price based on all kinds of things, inlcuding whether or not you came to the site directly or had done a price search (aka Froogle) beforehand.

There's always a point/counterpoint to these things: virus vs. antivirus, spyware vs. antispyware, etc.

So it sounds like this is a ripe area for the next generation of home software -- setting up cookies and such on your machine in order to get the lowest price when online shopping (you heard it here first, folks)

Re:The Euphemism is: Price Customization

[cursion]

So it sounds like this is a ripe area for the next generation of home software -- setting up cookies and such on your machine in order to get the lowest price when online shopping (you heard it here first, folks)

Thanks for the tip, now we know who to watch.
DMCA goon

Advice from InternetWeek

[LegendOfLink]

Antone Gonsalves from InternetWeek gives some advice to avoid this:

Internet shoppers who want the best prices should delete cookies as often as possible. That's because the less online merchants know about you, the less likely they'll be able to figure out how much you're willing to pay.

Anyway, I'm not against companies taking advantage of technology to boost revenues. Heck, it would be naive to expect businesses to do anything else. But I do have a problem with failing to disclose the information you gather and the reasons for gathering it.

I agree with the study's recommendation that retailers be required by law to disclose their data-gathering practices. Companies that don't have full disclosure, while continuing to take what they can from customers, are the real "bottom feeders."

Re:Advice from InternetWeek

[cicho]

"the less online merchants know about you, the less likely they'll be able to figure out how much you're willing to pay."

And this is a very good argument indeed for online privacy. As in, Amazon should not know what I bought at BarnesAndNoble. Loss of privacy need not be about the government watching your every move. It can well be about getting ripped off more often.

What is funny is..

[pthor1231]

" First-time buyers at a retailer could see higher prices than a firm's repeat customers, and retailers may not offer discounts to consumers who buy the same brands regularly without even looking at alternative products on the same site" So...give people who repeatedly shop at your store a discount, but only if they change what brand they buy all the time, rather than having a favorite brand because.... oh I don't know....maybe it lasts longer?

Bottom feeders

[Skater]

FTA: They are known within the industry as "bottom feeders" who don't show any brand or merchant loyalty.

The arrogance it takes for an industry to come up with this phrase is just amazing. I think I'm generally more pro-business than most Slashdot readers, and I don't even fall into that category - I'll go with a brand/merchant I've used before even if they are priced a bit higher, if I feel I got good service, because I'd rather deal with a known quantity. But the "bottom feeders" term makes me want to slap some people around.

Perhaps what's really annoying me is that companies don't want to compete and so are doing everything they can to attract their "ideal" customer while saying "screw you" to the other guys. As someone who has been ignored at car dealers on several occasions (usually because of my apparent age or because of the borrowed car I was driving that day), I find the practice of turning customers away arrogant and annoying. Changing prices only makes it worse.

Re:Bottom feeders

[nharmon]

I know someone who walked into a car dealership and two of the salesmen were arguing over who had to go help him, as they didn't think he would actually buy anything.

He left with a $40,000 pickup truck, having bought it from neither of those two.

Re:Bottom feeders

[Rude Turnip]

"As someone who has been ignored at car dealers on several occasions (usually because of my apparent age or because of the borrowed car I was driving that day), I find the practice of turning customers away arrogant and annoying."

That reminds me of a couple stories I've heard.

My grandmother was at the bank and saw and old guy in scruffy clothing walk in. He filled out a withdrawal slip to make a withdrawal. The teller was trying to ignore him and was rather rude. He then went to get another withdrawal slip, filled it out and said, "Here, now you're going to have to give me this much instead." He took $1 million out of the bank that day because the teller was being a bitch.

More recently, a co-worker of mine was sitting in a large, empty board room at a high-powered New York law firm waiting for a meeting to begin. Another old guy in a scruffy suit (who could have been a security guard) walks in and they start a friendly conversation. The meeting starts to get together and its turns out this old guy was to be our client.

The lesson I guess is always talk nice with old men in scruffy clothing.

Re:Bottom feeders

[Hoi Polloi]

If you think that is bad you should listen to the credit card industry that punishes people who pay their balances off in full every month.

Re:Bottom feeders

[Enfors]

This reminds me of an interesting story my father told me, that supposedly happened here i Karlstad, Sweden, in the early 20th century.

There was a rich farmer who lived outside the city (supposedly in Ekshärad) who decided to go into the city to do some shopping. Even though he was wealthy, you couldn't tell by the way he dressed. So, he walks into an expensive furniture store, and finds a large mirror that he's interested in buying. He asks the clerk how much the mirror costs, but the clerk says something along the lines of "more than you can afford". The farmer, understandably angered by the clerk's arrogance, grabs his cane and smashes the mirror. "Now will you tell me how much the mirror costs?" he asked the baffled clerk who now decides to answer. The farmer pulls out his wallet, puts the money on the counter and leaves.

Re:Bottom feeders

[DrEldarion]

I'll go with a brand/merchant I've used before even if they are priced a bit higher, if I feel I got good service, because I'd rather deal with a known quantity.

Sites like Reseller Ratings makes shopping at stores you haven't shopped at before a lot more "known", though. That combined with other sites dedicated to saving money on your purchases makes it very easy for people to get the best deals on things from sites that are known to be reliable.

It makes sense that they wouldn't want to try and target these informed consumers. The informed ones are flighty and much harder to make any money off of since they'll only buy from you if you already have the best price (meaning less of a profit for you). The companies place a lot more worth in getting a clueless customer who will keep coming back despite what their price is.

Re:Bottom feeders

[Andrewkov]

I was talking to a banker about farmers once (I don't know how it came up), but farmers will routinely come in move $100,000 or more from one account to another or one bank to another, depending on the season or what equipment they're buying. They obviously aren't getting rich at farming, but they do have a lot of money tied up in assets and can have large sums of cash on hand at certain times of the year. So never underestimate people! :-)

Reminds me of some wise words I learned in grade school -- never pick a fight with the fat kid, they are usually a lot stronger than they look!

Re:Bottom feeders

[Austerity Empowers]

How do they do that? As far as I can see they don't charge me extra for it. They make money on each transaction, and I use my credit card instead of cash or check. The only trick is I pay it off every month. Yes, stores who take credit cards tend to have somewhat higher prices as a result, but I don't know of many stores even in NYC (which used to be "cash only, no taxes") that don't take them anymore. I think the drop in muggings is largely due to the fact that there's no excuse for carrying more than $100 in cash on your body.

Re:Bottom feeders

[Fishstick]

I had a somewhat similar experience.

Right after I got out of school and got a job I was in the market for a new car and had narrowed down my price range and picked out 2-3 different models I was interested in. They were in the $30-35k range.

I went out on a Saturday in my jeans and t-shirt in the beater I had been driving through school (a ex-state-cop dodge diplomat). I got luke-warm to cool reception at the first couple dealerships (one wouldn't even let me test drive, wouldn't talk about price, only payments and asked me how much I expected to put down in addition to my worthless trade -- I didn't tell them that I already had financing).

I pretty much walked out of each of those without ever talking price. The last place I went that day, the guy was really decent, chatted me up about where I went to school (only one to notice the boilermakers sticker on the dodge) and generally did not seem to judge me based on my appearance. I talked price and financing terms with him but did not buy that day.

I went back a couple nights later, having gotten my check from the credit union for the amount he was talking, and made the deal. I drove home that night in my new car and stopped at one of the dealers that had been particularly crappy to me.

I got out, still wearing the work clothes (dress shirt, slacks and tie) from the day and the same sales jerk from before came walking out with a big smile asked if he could help me.

"You don't remember me, do you?"

"Um... Oh sure, you were here looking the other day. Would you like to take a test drive tonight?"

"No thanks, already did." and turned my back and walked back to my new car. Should have seen the face on this ass-clown as I got in and drove off.

Re:Bottom feeders

[That's Unpossible!]

The arrogance it takes for an industry to come up with this phrase is just amazing.

I hate to break this to you, but every "industry" comes up with these types of phrases. Ever dealt with a "luser" while doing tech support?

Just because there is a term out there used within the industry doesn't mean amazon.com employees stand around and refer to the "bottom feeders" on the site that day.

But so what if they do? As long as they treat me well and provide the products or services I want, I couldn't care less how they refer to my segment of the population behind closed doors.

Perhaps what's really annoying me is that companies don't want to compete and so are doing everything they can to attract their "ideal" customer while saying "screw you" to the other guys.

Companies do want to compete. Different companies seek out different sweet spots. Some companies will try to sell to everyone, and everyone pays a slightly higher price. Some companies will do what is described in this article, and give benefits to their repeat customers to make them loyal.

I find the practice of turning customers away arrogant and annoying

Then when you find out what stores do it, don't shop there. If enough people look at it that way, they'll change their practices. But be prepared to pay more for products and services if you don't want to deal with certain companies.

Re:Bottom feeders

[archen]

A car nut who owned his own tractor factory took his car back to the Ferrari factory when his clutch failed. Enzo Ferrari snubs the man because of his affiliation with tractors and "not understanding such a refined vehicle". The (rather pissed off man) fixes the clutch himself. Ferruccio Lamborghini later decides to enter the exotic car business himself, in competition with Ferrari.

Re:Bottom feeders

[Boiner]

You think that's bad -- you know what credit card companies call people (like me) that charge all month and pay the balance in full?

*Deadbeats*.

If that's not ironic and insulting, I don't know what is...

Re:Bottom feeders

[Jah-Wren Ryel]

"Um... Oh sure, you were here looking the other day."

It is standard in sales to never say "no" - the guy did not remember you, he just pretended to because it makes the potential customer feel like he's important enough to be remembered.

Re:Bottom feeders

[meringuoid]

More recently, a co-worker of mine was sitting in a large, empty board room at a high-powered New York law firm waiting for a meeting to begin. Another old guy in a scruffy suit (who could have been a security guard) walks in and they start a friendly conversation. The meeting starts to get together and its turns out this old guy was to be our client.

Reminds me of a story I heard from my grandad.

As I remember the story, there was this guy in Liverpool in the fifties and sixties who used to run a building company, and, being himself an Irish immigrant, tended to employ other Irishmen just off the boat (hence how Grandad knew him). Also, he was in the habit of going to work alongside the men he employed from time to time so as not to lose touch with what was going on.

He's been planning to buy a new car, has this fellow, and one day after he's been working on a building site he sees a Jaguar showroom across the road. In he goes - still in his working clothes.

Of course the three guys in there already want nothing to do with this scruffy Irish builder and send the most junior employee they have to deal with him. Said junior is ecstatic when scruffy Irish builder writes out a very large cheque on the spot and drives away in an expensive sports car...

Re:Bottom feeders

[Fishstick]

Exactly. I'm sure that's the case. He barely acknowledged me when I went in the first time (I don't think he even bothered to ask my name). I'm certain he saw the cop-car beater, the young guy in jeans and t-shirt and didn't see me as a potential customer worth his time.

I showed up a couple nights later wearing a shirt and tie and driving a nice car and he pratically ran out of the dealership to greet me in the lot and introduce himself.

Re:Bottom feeders

[mcmonkey]

How do they do that? As far as I can see they don't charge me extra for it.

As far as you see. Those little slips of paper that come with your bill every couple months, the ones where the company unilaterally changes your credit card agreement. They contain details of what interest you will pay on outstanding balances, as well as what grace period you have before interest starts accruing, what fees you'll pay for a late payment or returned check, and what annual fees you'll pay for having the card.

You read all that fine print, don't you? Good. Do you read all the fine print they send your neighbor? How far is, as far as you see?

Just as retailers have different prices for different customers, credit cards may have different interest rates and fees for different customers. Austerity Empowers, you and I pay off the balance in full each and never miss a payment, so we don't pay much mind to changes in interest rates and late fees. But credit card companies have been known to initiate annual fees for accounts that started with no such fees, when the card holders did not produce enough revenue. There were stories a few back regarding companies cancelling out-right accounts that did not produce enough income.

Yes, credit card companies make money on each transaction. But there is pricing pressure on that side--don't think merchants don't feel those fees and are afraid to cancel accounts with companies that charge higher rates. I've been out of retail for a while, but at least as of 2001 in the USA a lot more places accepted MasterCard and Visa than accepted AmEx. Amex charged more per transaction. Naturally the credit card companies look to make up the difference on the other. (That's you and me.)

Re:Bottom feeders

[miltimj]

Very nice -- I applaud your actions. This is why I always go shopping for a car in very casual clothes. It also gives credence to the guise I put on that I "can't really afford that" to get the price lower.

Re:Bottom feeders

[Yakko]

As someone who does just that, I'd be interested in knowing how I'm being "punished." Is it the mountain of junk mail? Is it the insulting offers to transition from a low fixed rate to a variable rate? I'm having trouble figuring out if I'm really their customer or the albatross around their neck at times.

Re:Bottom feeders

[Fishstick]

Yeah, in the end it wasn't even really about price (though I think I got a pretty decent deal).

The salesman I bought from answered my questions, let me take a test drive without more than photocopying my license, and treated me fairly when I sat down to talk price.

"Do you want to negotiate based on payments or price?"

I almost fell over. This guy didn't try to pull out any of the 'how much down, how much a month' tactics -- he asked me straight out how I wanted to buy the car. I told him that I had a price range, and had already secured a loan, but was willing to consider any financing deal he wanted to offer.

He showed me the sticker and invoice, which jibed with the research I had done. He said he could do 1k over the invoice, which was $500 less than I was going to haggle for. I told him I was going to come back with that much from my credit union in a couple days. He didn't pull any 'wait, what can I do to get you to drive home with it today' crap.

I came back Tuesday night with the check and closed the deal. I felt respected and that he had been honest and fair in selling me the car without any typical car salesman bullshit.

I could probably have gotten a similar price at the other dealership, but would have to have gone through all the BS.

Re:Bottom feeders

[Fishstick]

Heh, it was even a Mt. Prospect car.

I was living in Arlington Hts at the time and picked this one up at an auction. It was an unmarked 'community service' vehicle, but it had the full 'pursuit' package. It even had the little external spotlight on the driver's side.

I loved cruising around in that thing, watching people pass me and then slow down. My buddy suggested that I get a blue shirt and hang it in a dry-cleaning bag from the hook over the rear passenger-side window to give the impression of an off-duty unmarked patrol car. Only problem was with the long hair and beard, I didn't look like a cop (except maybe Serpico).

Great car until it needed tires. The shop didn't have the pursuit tires to match the ones on it. I would need to order them and they weren't cheap. I ended up getting some normal radials. They mounted them with the lettering facing in, but it just didn't look the same after that.

That car was great. I took good care of it, changing the oil religeously every 3,000 miles. I drove that sumbitch until the oil pump drive sheared off at 170K miles.

Re:Bottom feeders

[Bwah]

This reminds me of my experience in new car buying when I graduated. I was in roughly the same price range as you were. I look very young for my real age, so at 21 you can imagine the response I got. I guess the beat up old chevy corsica and faded jeans probably didn't help either.

So after a week of wasting evenings with this bravo sierra, I ended up at a Mercedes-Benz dealership. They were the only people that didn't treat me like shit the entire week. Blew my mind. Here I was, on the higher end of the vehicle lineup everywhere else, and got blown off. The MB people treated me well and I was buying their cheapest vehicle!

It's funny how these things work out. I actually ended up saving money over a high end jeep or tahoe, and got a much more capable 4x4 in the bargin (even if it does vaguely resemble a minivan!)

So, after a couple of years out of school when I suddenly have larger amounts of money to spend on a car where do you think I'll start looking? Jeep again? Probably not.

Re:Bottom feeders

[Desert Raven]

Hehe, reminds me of how I was treated at car dealerships.

The sales folks take one look at me, and send out the most junior salesman to deal with me. Which is cool, since mostly I've found that the junior guys don't have so much of a bias, and treat me quite nicely. At one dealership,the guy was literally on his first week on the job. In 18 months, he sold me three cars. I liked him well enough to go back to the dealer and ask for him by name.

Really funny part was the first time, when it became apparent that not only was I going to buy a car, but it wasn't going to be a stripped-out cheapy, my salesman's "supervisor" tried to take over from him. After ten minutes of listening to this pompous jerk, I looked at the junior salesman and told him that if the senior salesman didn't clear out of the room in ten seconds, I was going to walk out the door. The looks on their faces were priceless, shock and offense on one face, surprise and a bit of a smirk on the other. :) I got my way though.

Re:Bottom feeders

[Slime-dogg]

Since we're talking about purchasing experiences... I had a different experience altogether. I think that it may have had to do with the fact that I had made an on-line inquiry about the vehicle, and put how much I made a year.

Anyway, I bought a Nissan 350Z, and I had never driven a manual before. I took my boss along to do the test-drive, and they let me go in the car with him, instead of the dealer going along.

The feeling that I had, coming out of the dealership, was that they really wanted the sale. It wasn't one of arrogance, it was more one of "we'll do anything to get you walking out of that door with keys in your hand."

Re:Bottom feeders

[FuzzyBad-Mofo]

Sounds like that guy at the dealership was a real ass. You'll have that in the 'burbs. I had a similar experience at a Harris bank (I think it was in Lombard) once when I was in college. They will never see a dollar of my money because of it.

Re:Bottom feeders

[Razzak]

Car dealers it's great. I've had that happen to me because I make sure I drive my worst car possible and show up in a t-shirt.

If someone does come up to you, say: "Well, I was looking to buy this silver m5, but since none of you were interested in helping me or selling this car, I'm just going to go to the mercedes dealership. Also, I'm going to send a complain to BMW about your terrible service and how it's made me realize that BMW is not a company that values its customers."

Salesperson: "I'm sorry blah blah bl--"

You: "Forget it. It's too late now."

Of course, this only works if you actually follow through and write the letter to their manufacturer. Surprisingly, many companies want to make sure you are very satisfied to create repeat customers. I'm yet to hear the auto industry refer to anyone as a "bottom-feeder". Remember, complaining to GM, BMW, Mercedes, or Ford will do you more good than complaining to the BBB.

Re:Bottom feeders

[Fishstick]

Yeah, Citibank managed to piss me off long ago when I went in to talk about a mortgage.

My wife and I were renting and looking to buy our first place. We had gone to a couple of townhouse new development places, but weren't sure what we could afford. We were banking at Citibank at the time, so we called over to see if we could set up an appointment to talk to someone.

The guy wasn't from the branch, he drove in from the city to meet with us. We brought bank statements and tax returns and all of the other stuff they said to bring. He asked us where we were looking (as he looked down his nose at us in his $700 pinstripe). We told him where we had looked at townhouses but we weren't sure what we could afford.

He muttered something under his breath, gave us a look and said something to the effect that we were reaching too far and we should probably stick to used properties (before he even looked at any of the papers we had brought).

We said that this is why we were here, to find out what our price range was based on how much we could put down and borrow. He scribbled a number on the back of his card and told us to give them a call. It was HUD.

We pretty much took our banking somewhere else that day. Turns out that with the money both of us had saved and our dual incomes, we could have easily afforded any of those properties we had looked at (guess we just didn't look the part that day).

The lady we ended up with at the new bank did a great job of assessing our finances and pre-qualified us for a mortgage. She put us in touch with a realtor they worked with and we ended up in a nice house that actually worked out better for us than the townhouses we were originally checking out.

Re:Bottom feeders

[benzapp]

Duhh.

I mean, farmers only get PAID at harvest time! Why do you think its such a time of celebration?

Part of the great enslavement of modern man has been putting him on a regular cash flow. Being a farmer required discipline, that made it more difficult to corrupt him with false promises of happiness through useless crap and fast food.

You had to make that cash LAST all year long, and through the winter.

Re:Bottom feeders

[gumbi west]

I always think it's funny. Everyone always complains when capitalism in action means that they have to be on their toes. Marketing experts, of all people, know how capitalism is supposed to work and know that these people essentially have them licked.

Think of it as a sign of a job well done when you competition calls you a name.

Re:Bottom feeders

[pipingguy]

A well-loved urban legend has it that a shabbily-dressed man mistreated by an uppity clerk...

Re:Bottom feeders

[siriuskase]

Had almost exactly the same experience. I was driving my going to college car and when I finally got someone's attention, he pointed me towards the Honda dealer next door. I like Honda's as much as anything, but if I'd meant to go there, I would have. Salesman who don't realize that some poor college students get much wealthier shortly after graduation, don't deserve the business they lose. But, it sure is a hassle for the shopper who doesn't get all dressed up work at looking old just to go car looking.

Re:Bottom feeders

[rynthetyn]

I've spent enough time working in retail to learn that you can't really judge shoppers by their appearance or by how much they may spend on a particular day. I've had really slopply looking people come in and drop boatloads of money without blinking, and well dressed people be the biggest skinflints who make you jump through all kinds of hoops and then walk away with next to nothing. Or, you may have the customers who don't buy a lot at any one time but who come in frequently, and their small purchases every week or so end up netting bigger returns that the customer who may dump a lot of money on one occassion and never come back. Plus, if the you treat the customers who don't spend much just as well as you treat the big spenders, they may very well come back looking for you specifically when they do want to make a major purchase.

Nothing bugs me more than the stores where the clerks ignore me until I walk up to fitting room with a big stack of expensive clothes, at which point they realize that I'm actually intending on buying and start helping me. It also bugs me that all other things being equal, I get better service depending on what handbag I carry. And don't even get me started on computer stores, if one of my brothers is with me when I walk into one, it's like I blend into the surroundings and don't even exist, although I'm the family geek (the Apple store being the single exception, and because I was happy with the experience I direct other people their way).

Re:Bottom feeders

[B.D.Mills]

They are known within the industry as "bottom feeders" who don't show any brand or merchant loyalty.

In the marine world, a bottom feeder is an animal that finds its food on the bottom of the ocean.

If online bargain shoppers are "bottom feeders", then the unscrupulous online merchant must be "sharks".

Re:Bottom feeders

[Austerity Empowers]

Well I'd notice if they charged me a membership fee, and they have not. I'd notice if they dropped me, and they have not. No I don't read all the paper every time my card changes carriers, but no I can't say anything has happened that's pissed me off. Using autopay I can avoid late fees, and with some discipline I manage to send an exact check out once a month.

So that's "as far as I can see". There are so many cards, by so many providers, I'm really not afraid of one biting me. I'll go to his competitor in 5-7 business days (i.e. the amount of time it takes to get a new card).

How about....

[fanblade]

...a list of websites that do this? :-)

Yep

[beforewisdom]

There was a story a few years ago about Amazon charging people different prices on the same items based on the customer's geographical location.

You can use this site to compare prices on books, cds, dvds ..etc across site, with the cheapest price on top. The information includes shipping costs:

http://www.bestbookbuys.com/

You can also blow your cookies and see what the prices are before you sign into your account.

Re:Yep

[beforewisdom]

First, there are already different editions of most books for 3rd world countries that cost orders of magnitude less.

In college I would wait to buy my textbooks until my roomate went home on vacation to India. He could come back with the same books, on slightly cheaper paper for 1/5 - 1/10 the price.

The "whats was wrong with it" and why Amazon got successfully sued was that Amazon wasn't doing a sliding scale like the one you described.

They were charging people in the same country ( U.S. ) different prices based on geographical factors.
It wasn't a "Poor charge less, rich charge more" scheme. It was a "poor charge same, middle class charge even more" scheme.

At the time Amazon defended the practice by comparing themselves to brick-n-mortar chains that had higher prices in posher locations.

What Amazon failed to point out, but the judge did not miss was that brick-n-mortar stores pay mor more money ( rent, taxes ) to operate in those posher locations. Amazon operated at the same costs always being in the same location.

In addition to geography, within the same country, same area they used customer profile information in other ways to charge people more.

I really fail to see what the problem is

[goldcd]

If you don't like the price that something's being offered at, then you just don't have to buy it.
There's no legal obligation that car dealers have to give everybody the same lowest price that they ever sold a car for.
I'm not sure about the idea mentioned in the article that regular customers will get lower prices though - surely it should work the other way around. You get the customers landed with cheap prices and as they keep coming back you gradually tap them up until their visits start to drop off and then you start to lower them back down.

Re:I really fail to see what the problem is

[Skye16]

Unless, of course, they discriminate based on race, religion, sex, or physical disability. Or at least a landlord can't do that. I can't imagine it being legal to say "well, this usually costs 5$, but since you're black, it's $50000".

Re:I really fail to see what the problem is

[DeepHurtn!]

The problem really is only that people seem to be unaware that it is going on. I can understand why; people are so used to seeing a non-negotiable sticker price on consumer goods. I agree with an earlier poster who called for full disclosure from companies with regards to their data collection policies. Even the most rabid free marketeers understand that it can only work if customers are well informed.

Re:I really fail to see what the problem is

[rnelsonee]

I believe it does work the other way around - that was the claim when Amazon was "caught" doing this. I think the problem was that people are used to getting deals - paying less than the usual price. No one makes a big deal when people with those grocery store cards save money on a can of soup, because we see them as saving money.

So I think it all has to do with the baseline price, or what most people pay. Saving money is good (even if you aren't the one saving), but if most people are paying $20 for something, but someone else gets charged $22, that shocking to some people. Instead of a bunch of people saving money, it's seen as one guy getting screwed.

That's why I didn't like the Amazon thing at first (I was slated to be someone that paid more), but when I thought about it, I realized there's nothing wrong with it. I just wasn't in the savers' group. And if I don't want to buy something for $22, then I don't.

Re:I really fail to see what the problem is

[Gulthek]

Sure it isn't legal, but that doesn't mean it doesn't happen.

Re:I really fail to see what the problem is

[kbielefe]

I've never heard that about Amazon.com. In fact, I have had the exact opposite experience so I have to believe that if it was true, they completely turned around many years ago. I buy all sorts of things from them (even a pair of pants once) several times a year, and frequently check their prices at work where they don't have my cookie. Almost every time I have pre-ordered a DVD or book, they have sent me a refund a couple of months after delivery because they have had a good sale on the item.

I once bought a textbook through their marketplace from an independent vendor who failed to deliver it. Amazon promptly refunded my money no questions asked even though they were just the middleman and were taking a complete loss by it. That was the only problem I have had out of dozens of orders with them.

I am constantly telling people to exercise extreme caution when buying something on the internet, but I never hesitate to recommend Amazon.

Re:I really fail to see what the problem is

[gumbi west]

uh, "Amazon promptly refunded my money no questions asked even though they were just the middleman and were taking a complete loss by it."

If you read the fine print, they promise to do that. But, keep in mind, they will only do this five times durring your life, then you are out in the cold again.

... and they like it that way

[Stavr0]

You click on the 'buy' button with your eyes closed == Angel
You shop around, haggle, diligently apply for all possible rebates, never settle for anything else than the minimum price == Demon

Guess which of the two businesses prefer?

most online users...

[mattkime]

....are stupid. period.

For all you UK geeks out there....

[the_xaqster]

You might want to try http://pcindex.co.uk/ for your PC needs.

From the site:
Currently indexed:
13 major UK retailers, and over 4500 prices.
Prices and stock levels are updated daily!

Enjoy.

Age-old line

[Gadgetfreak]

Customer: "How much is it."
Vendor: "How much you got?"

It's just a different store front, I don't know why people are so surprised.

For many, many years, particularly in areas of the service industry where prices may be negotiable, people have been quoted a price based on something as simple as their clothes or their car. If they look like they'd be willing to pay more, is it wrong to ask for more?

Re:Age-old line

[rynthetyn]

I knew someone who worked as a desk clerk at a hotel. He said that all hotel prices are negotiable, and if the clerk sees you pulling up in an expensive car you're going to get quoted a price from the high end of the scale, but if you have a bad car they'll quote you a lower price. Moral is, if you have a nice car, park where they can't see it and walk in.

I've gotten money knocked off of the supposedly bottom price AAA rate before, because my sister and I were traveling back to school and too tired to go farther, we looked kind of bedraggled, and when they quoted the price, we simply said it was too much and that we needed to look somewhere cheaper, and suddenly we got almost $20 knocked off.

Schock and out rage!!!

[1967mustangman]

You mean they are tracking my buying history!!! They are giving me a different price than someone else!!! Why that is shocking and outrageous!!! How dare they use age old methods of prefered customer discounts and high-tech haggling. I thought the web was supposed to be the final frontier where all were equal and eveyone got the best price!!! *chuckles ironically*

not so clever

[Espen]

First-time buyers at a retailer could see higher prices than a firm's repeat customers

That seems like an odd strategy to me. A potential first-time buyer may simply be lost to another retailer with a lower starting price.

Re:not so clever

[indian_rediff]

First-time buyers at a retailer could see higher prices than a firm's repeat customers

That seems like an odd strategy to me. A potential first-time buyer may simply be lost to another retailer with a lower starting price.

I, too, was mystified by this quote. I would expect it to be the reverse - that a regular customer gets a slightly higher price - mainly because they know this idiot will buy from here anyway, while the newcomer is tempted with a slightly lower price.

The method used to track current customers could be as simple as a cookie or as complex as using the customer's login information (from cookie) and deriving behaviour from past buying.

e.g., I keep going to Buy.com because I like their service - or the lack of the need for it because I have never needed it! Also their prices are better than Amazon's (DUH!) but probably not the best prices.

They also know that I would buy something from them even if it is priced slightly higher.

What is wrong with doing so? Nothing at all!

This happens all the time at Neiman Marcus stores! Why else would someone buy a shawl or a scarf for '000s from them, when the same shawl can be had for hundreds less with slightly lower quality at a more pedestrian store like Sak's Fifth?

Because they provide service that is unparalleled! I read an example in the Wall Street Journal some days ago of a woman who had bought a blouse from Neiman and had a stain. She had to rush to catch a flight, called the store to see if they had a replacement - and on her way to the airport, parked outside the store and an assisstant was waiting there with a few blouses - she sat in the driver's seat, engine running, compared a few, selected one and drove to the airport. Note - no payment was made! Total extra time - about 7 minutes.

What did Nieman get out of this? Probably a life long customer - life long as long as she is rich :-)

Ever go to a frickin' grocery store?

[bigtallmofo]

I know the Slashdot crowd has a reputation of living in their parents' basement, but come on. Have any of you expressing surprise and outrage ever shopped in a grocery store? Let's see...

Almost every item is listed as a "regular price" and a "club price". If I possess one of their club cards (i.e. approximation of a frequent shopper), I pay the club price. If I don't possess such a card, I pay far more.

Oh, and then there's the whole coupon thing. Based on my shopping habits, sometimes a coupon prints out, making me further pay less than another consumer for the same item in the same store. Sometimes they even mail me a coupon to encourage me to buy a particular thing!

You can express your opinion on the fairness of this, but expressing surprise or doubt that this occurs only shows you haven't been paying attention in the online OR the offline world.

Re:Ever go to a frickin' grocery store?

[AnonymousJackass]

Yes, grocery stores do this, but they do it openly. On the price tag it will clearly state the "member" price and the "non-member" price. The problem with these internet shopping sites is that they are not telling you upfront that there are different prices for different people. That is what's wrong.

Re:Ever go to a frickin' grocery store?

[hibiki_r]

It changes heavily by state. Most grocery shops in California seem to do what you describe. You just forgot to say you don't really need to give a name or address to sign up for the club card, so you could get a new card every day if you want to. On the other hand, I've yet to see a grocery chain in Missouri with a 'club price'.

Re:Ever go to a frickin' grocery store?

[AndersOSU]

They give you the card openly, but do you know what they collect? I don't, but I know that they keep track of how much milk I buy (every 6th gallon free) and how much I spend around thanksgiving (so I can get the free bird).

The club card is sketchy data collection if I've ever seen it. All your purchases could be cataloged along with your name address and phone number.
I used to give fake numbers out for things like this, but then they got wise and decided they needed to mail the card to my house, and i can conveniently enter my phone number if I've forgotten my card...
I wonder how closely they document my tin foil purchasing habits...

Re:Ever go to a frickin' grocery store?

[SoCalChris]

I know Albertson's does some data collection secretly.

We typically buy baby supplies at places like Wal-Mart or Target, since they are cheaper there. One night though, I didn't feel like going to Wal Mart, so I just stopped at the grocery store, and bought a pack of diapers. I paid for them with my debit card. This was before Albertson's used "club cards".

The next time I went to Albertsons, I just bought regular groceries, nothing that would indicate that I have kids. After paying again with my debit card, the register printed me out coupons for diapers and formula.

I'm not sure if they were keeping a copy of my debit card number, or just a hash of my debit card number, but I stopped shopping there after that.

Re:Ever go to a frickin' grocery store?

[YrWrstNtmr]

Sure they do. They know you as SoCalChris, whether you pay cash and use the Albertsons club card, or pay with your debit/credit card.

I have a Kroger card assigned to BlankName, that has only ever been used with cash. They know that card is being used, but no ties to me.

Re:Ever go to a frickin' grocery store?

[Chanc_Gorkon]

Just wondering....what about the people in front of you? Did they have a kid? Sometimes the cashier will only get those for you if you remind them, or if they get in the way(Lowpaid Cashier: I forgot the last 5 people now I will give all of them to the next guy....).

Re:Ever go to a frickin' grocery store?

[jon787]

For me the last straw was when I noticed the new forms for the values cards at the store I worked at required your driver's license number. I don't work there anymore, I won't even shop there.

Re:Ever go to a frickin' grocery store?

[Gulthek]

They had a copy of your debit card number. If you shop with your debit card, then your number is already strung around a million and one databases: including Target and Wal-Mart. At every retail store I've ever worked at, the transaction system kept copies of all the credit card numbers (including debit cards of course) tied to each transaction.

Have you ever returned something to Target and gotten the price credited back to your card without even swiping it? That's how that works.

One store I worked at a couple years ago kept CC numbers tied to the unrestricted transaction database. Any employee could look up transactions and search them for various criteria (i.e. all transactions that day, within a few minutes, for such and such an amount, etc.) and all info would display including CC#, your name, your address (if on file), etc. Were I unscrupulous I could have done some real scamming.

Don't be too worried about that one store though. There are many other easy ways to snag your CC number as a retail employee that have nothing to do with unsecured databases.

So either pay in cash, or just keep an eye on your accounts and credit (which you should do anyway!).

Re:Ever go to a frickin' grocery store?

[zCyl]

Have any of you expressing surprise and outrage ever shopped in a grocery store? Let's see...

Almost every item is listed as a "regular price" and a "club price".

Actually, I try to avoid grocery stores which do this.

It just adds an extra level of pain to what should otherwise be a simple process, and there's no good reason to support it. If they want my business, they can just offer me a good rate without trying to make me fill out forms.

Re:Ever go to a frickin' grocery store?

[Vellmont]

Have any of you expressing surprise and outrage ever shopped in a grocery store? Let's see...

There used to be a grocery store around here that did exactly that. They stopped doing it about a year or two ago probbably because people didn't like it. I think it was more of a hassle to get the stupid card than it was anyone implying the discount card was unfair.

There's also a BIG difference between grocery loyalty cards and online price "customization". The grocery stores tell you upfront how to get the discount price, and the discount price. The online retailers don't tell you the discount price, don't tell you that someone else is getting a discount price, don't tell you how to get the discount price, and don't want to talk about the practice much at all. That adds up to a whole lot of mystery about who's getting the better prices and who's not. That can easily lead to people thinking they're the ones getting taking advantage of (price gouging). Are retailers simply trying to get as much money out of me as they can? Am I being charged more because I "look rich"? Those are the questions that go through peoples minds when they hear differenct prices are being charged to different people. No one likes getting screwed, and that's exactly what it looks like when the online retailers are secretive about this "price customization".

Re:Ever go to a frickin' grocery store?

[jesser]

Online price customization has more in common with grocery coupons than with grocery loyalty cards.

One to One Marketing

[lbmouse]

This is simple one-to-one marketing. The basic theory goes that it is more profitable to keep a current (reliable) customer than try to find new customers that may or may not be reliable. That is why you are seeing more "loyalty" and fewer "first time buyer" incentives.

Re:One to One Marketing

[fishbowl]

>You don't enforce the GPL, you enforce COPYRIGHT!
>The GPL (like "fair use") is a defense!

It's rarely said, because it's so widely misunderstood.

Re:Really? I don't believe it.

[Exluddite]

"I have multiple computers in my home and use the primary one to make online purchases, yet I have never noticed a price discrepancy when browsing the same items at the same online shops using my other computers."

I'd hazzard to guess that they are looking at either your IP address (and just see that network as one computer) or login information. I suppose you could set up multiple accounts, vary your buying habits on each, and check the results, but that's just as much (or more) work than shopping around and doing some price comparison.

what?

[utexaspunk]

you mean there are naive people on the internet?

Re:what?

[JenovaSynthesis]

Like omigawd! There cannot possibly be naive people on the Internet!

Re:Really? I don't believe it.

[ylikone]

That could be true. Although, I do a lot of comparison price shopping before I order online and tend to stick with the better known sites, so maybe I just don't come across this practice.

Don't everyone volunteer at once

[bigtallmofo]

Don't be surprised if no online vendor takes you up on your tempting offer to disclose their trade secrets in exchange for satisfying the curiosity of "ylikone" on Slashdot.

Reserve price

[Roached]

In economic terms, this is called the reserve price, or the price someone is not willing to exceed in order to purchase something. In a perfect economy everyone has their own unique reserve price that they feel is fair for what they are buying. It's been accepted in the airline industry for years, but I guess when it's applied to other items people feel like they were ripped off if they find that they could have gotten it cheaper.

Rephrased..

[th0mas.sixbit.org]

This just in: there is a difference between what you think is illegal, and what is illegal.

That's not news

[Alcoyotl]

Just because it happens on the 'net doesn't mean it's a totally new practise. Hell, brick and mortar retailers have been doing this for years. Normal customers get the retail price, but when you're a preferred customer, or on some marketing scheme you get discounts.
Doesn't bother me at all.

The shopping world has always been divided between suckers and price hunters....Move along, nothing to see here.

2.51 percentage points?

[gantos]

plus or minus 2.51 percentage points

That's odd -- my screen reads "5.21 percentage points."

Re:2.51 percentage points?

[Telecommando]

Maybe they change the percentage based on who's reading the article. ;-)

The grand era of the ultimate market segmentation

[Aceticon]

... is here

One of the ultimate grails of maximizing profits is to segment the market to such a point that sellers get out of each individual buyer as much as he or she is willing to pay for any item.

In the case of online shops, technology allows sellers to get a good approach to maximizing acceptable price per individual buyer.

Smart buyers can also use technology to maximize the ammount of satisfaction they get per-buck spent - try comparisson sites, online user reviews and such.

Dumb buyers will continue to passivelly get reamed by smart shops. Call it natural selection.

Victoria Secrets did this

[smooth wombat]

Replying to my own posting (yayyyy!!!), I remember several years ago when Victoria Secrets was found to be doing the same thing with their catalog sales.

They would send out the same catalog to the same address but would have different prices for the same items depending on how much you had previously bought or were male or female. People began to figure this out and complained.

Link 1 about this issue and another link from a 1998 Forbes article on the issue of price discrimination.

For a more in-depth look at price discrimination, see this link which is a muli-page essay from the Virginia Journal of Law and Technology from 2001.

Re:Victoria Secrets did this

[fishbowl]

"They would send out the same catalog to the same address but would have different prices for the same items depending on how much you had previously bought or were male or female . People began to figure this out and complained."

Ah, but that is something very different from what's being reported in the paper from Annenberg! Gender discrimination in the sale of personal property, in every state and territory, is illegal, plain and simple, there's not much gray area, and it really doesn't matter whether the customer or the merchant believes it is illegal. It does not require a very broad interpretation of 42 USC ss 1981-1982, to find an actionable item with exposure to federal fines for noncompliance here.

Re:Victoria Secrets did this

[cicho]

Ah, so price discrimination *can* be illegal, depending on what gets factored in when setting the price. But when you shop online, you have no idea how they determine what to charge you. This is a part of what makes it sleazy. You don't even know that it's happening, and it is happening, and they just might be straying to the illegal side, too.

In a B&M store, at least you can see when you're payig more for teh bag of chips than the guy before you did. The playing level is more equal. To rephrase an old adage, on the internet nobody knows they're getting screwed.

Re:What' the problem?

[BK425]

The problem is that it adds to the overhead of doing a transaction. It's like a tax on leading your economic life. Price negotiation makes sense with some items, few people expect to buy a car without coming to an agreement about price. But when you get out of work late and run by the local store because you're out of T.P. ... do you want to have a discussion with the proprietor about the cost? You purchase far to many things every day to be able to reasonably re negotiate the price of each thing every time you buy it.
To illustrate this, go outside and watch your electric meter for a minute : ) How much did that watt-hour cost you? That one? It's not a workable plan.

Naive is right

[GhettoPeanut]

How can it be illegal to change prices based on what type of customer you are? Are people that stupid? What would we have done? Government intervention to force fixed pricing, sounds great, if your not into capitalism? It would seem that many Americans now want to be spoon fed the cheapest prices. its called research, your not supposed to just buy from the first place you find an item you want, your supposed to look for it, its a capitalistic society, competition of prices is what drives the market to change, if one company wants to charge less for a product because they have repeat customers...that would make sense to me...keeps them coming back, if your a one time pass through then yeah, why wouldn't' they just post the generic price? They don't know if you're coming back, you offer no real potential value outside of that one purchase. It just pisses me off to see some one bitch and say its "against the law" to have price variation based on customer usage. Don't like the store policies, don't shop there.

Re:Naive is right

[fishbowl]

"How can it be illegal to change prices based on what type of customer you are?"

There are a few expressly defined "types" that you really are not allowed to base it on. But other than that, it's not illegal, unless you've previously made some agreement with the customer that he was getting the lowest, or only , price. Then it would be illegal, because you've made a contract and breached it.

Looking at the paper, it appears that Annenberg has pretty low standards for research methods. But these are PhD students in commo, so I guess fluffy research papers are acceptable there.

True offline as well

[costas]

Customers are naive about prices period. Discriminatory pricing (what this article talks about) is prevalent in retail: coupons, special codes, AAA rates, frequent flyer miles, all are ways of charging some people less for the same product or service that others are paying more for. In the end it's all psychology: if Amazon or Dell gives customer A an "instant rebate" on the TV she just purchased, that's perceived as being a good retailer, but if they charge customer B more than customer A w/o any coupons or gimmicks, that's perceived as unfair.

Discriminatory pricing is here to stay, shops just have to get smarter about practicing it...

Time for that Near-Fatal Heart Attack Folks...Not

[JenovaSynthesis]

Anyone with half a brain ought to have recognized this happens by now. Someone mentioned that it should be inverse, that initial sales are cheaper and loyal customers get higher prices. What crack were they smoking? Say a customer buys a pack of DVD-R's from Site X and pays $29.99 for a spindle of 50 and the store gets a $10 profit from it. He likes the store, selection, etc. so he decides to buy them from there exclusively. So now he keeps buying them but Site X only charges him $24.99 cutting their profit in half in hopes of enticing more purchases from him either in DVD-R's and/or in other products. Now the model has shifted from one of maximizing profit through mark-up to maximizing profit on volume as it is better to get $5 from 100 loyal customers each because in order to get the same profit, you would have to lure in 50 new customers.

Brick-n-Mortar stores with an online presence will charge differently too. In fact, anyone who shops at Best Buy and 'pre-shops' on their website should easily have seen this because they offer better prices on the website than they do in the stores. I got caught by this when I bought some DVD-R's that were $19.99 on the site, but $39.99 in the store. I asked about the price discrepency and the cashier said that the website was no longer an online representation of the brick-n-mortar stores, but now competes with them. Of course Best Buy is not so dumb as to make you buy something from the site and have it shipped, you can get the price on the website by selecting Store Pickup as your shipping option.

Happens within the span of about five minutes.

[mosel-saar-ruwer]

How prevalent is this practice?

I've experienced price changes within the span of five minutes, or less. I'll be surfing around to sites, comparing prices, and I'll return to a site I've just visited, and they'll increase the price on me [I've never seen a price decrease].

I think they program the software so that the more hits they get on a product page served to your [preset] "cookie", the more they edge the price up on you, figuring, I guess, that you're really interested in the product, and that maybe they can "scare" you into purchasing it [or maybe somehow bleed that extra $10 of profit out of you on account of your insatiable desire for the product]. And no, I don't think this is primarily a supply and demand thing - I think these price change engines are primarily driven by some [previously arcane] theory of marketing psychology. The airline/hotel reservation systems [Expedia, Travelocity, Orbitz] are particularly guilty of this [and, again, I do NOT believe that it is primarily attributable to a finite supply of airline tickets or a finite supply hotel rooms].

And of course, you also have the phenomenon of e.g. different Yahoo stores [different URLs] that have identical ownership [i.e. identical "whois" lookups], and identical inventory [and, typically, identical SKUs], but which offer slightly different prices on the very same items. Or merchants whose "normal" price on an item differs from their "advertised" price at e.g. pricewatch.com.

Generally speaking, these kinds of gimmicks really tick me off, and tend to push me towards a site's competitor [assuming they aren't playing the same damned game] - and it sure doesn't make a damned bit of difference to me whether I purchase that ticket from Expedia, Travelocity, or Orbitz.

Re:Happens within the span of about five minutes.

[merdark]

This is why I run with cookies disabled by default. I only enable them for sites that absolutely don't work without them. And often, if there is a choice, I will just find a different site that does work without cookies.

Re:Happens within the span of about five minutes.

[silverhalide]

If you're buying just plane tickets from Expidea, Travelocity, or Orbitz, 9 times out of 10 it's cheaper to buy the ticket directly from the airline in question. Cut out the middleman.

Re:Happens within the span of about five minutes.

[dwvanstone]

If you suspect a site raised the price:

- Kill your browser
- Delete your cookies (if you can, just for that site)

Then check again. I'm not sure if you've witnessed actual price increase based on number of visits or just an unfortunate timing of a general price increase. Be scientific about your approach.

-dvs-

"It goes without saying that..."

Re:Happens within the span of about five minutes.

[Deflatamouse!]

Just want to point out that there's a solution (from the business's point of view) for users who don't use cookies... charge them the higher price!

This, of course, is not a good thing, but just one of the things businesses can do.

Re:Happens within the span of about five minutes.

[raju1kabir]

If you're buying just plane tickets from Expidea, Travelocity, or Orbitz, 9 times out of 10 it's cheaper to buy the ticket directly from the airline in question. Cut out the middleman.

Very true, for domestic USA flights only. And the best way to figure out which airline is often to use the engine at ITA Software's site. Sometimes you will find weird (unusably weird) routings but you will also get a list of the best published fares available. Some you can get at the airline's web site, others you need to print out the codes and take to a travel agent.

For international flights you're almost always better off with a good travel agent.

Re:Happens within the span of about five minutes.

[raju1kabir]

If you're buying just plane tickets from Expidea, Travelocity, or Orbitz, 9 times out of 10 it's cheaper to buy the ticket directly from the airline in question. Cut out the middleman.

Very true, for domestic USA flights only. And the best way to figure out which airline is often to use the engine at ITA Software's site. Sometimes you will find weird (unusably weird) routings but you will also get a list of the best published fares available. Some you can get at the airline's web site, others you need to print out the codes and take to a travel agent.

For international flights you're almost always better off with a good travel agent.

Re:Happens within the span of about five minutes.

[JadeNB]

I've experienced price changes within the span of five minutes, or less. I'll be surfing around to sites, comparing prices, and I'll return to a site I've just visited, and they'll increase the price on me [I've never seen a price decrease].

Amazon (which has already got plenty of mention) seems to be particularly bad in this. (For a while, due to some glitch, I would get constant messages of the form `The price of [Product A] has increased from $10.85 to $10.85.') I signed in today after a month's non-usage and had about twelve price increase/decrease notices appear. What I found strange was this:

I had signed in to delete some items from my to-buy-later list which I had recently received as gifts. When I first accessed my cart, I got `The price of Pirates of the Caribbean has increased from $13.99 to $14.99.' When I deleted the first item, I got `... has decreased from $14.99 to $13.99.' When I deleted the second item, literally not more than thirty seconds later, I got `... has increased from $13.99 to $14.99.'

Re:Happens within the span of about five minutes.

[STrinity]

I've experienced price changes within the span of five minutes, or less. I'll be surfing around to sites, comparing prices, and I'll return to a site I've just visited, and they'll increase the price on me

This is why God created tabbed browsing -- you can keep one site open while you check the price on the next.

common sales practice

[fermion]

It seems to me that the reason this is shocking to some is that most people have little experience outside of mass market sales, where one pays the asking price, or waits for a sale.

In reality it costs a fair bit of money to acquire a new customer, and discounts just add to that cost. Therefore, a sales department might be reluctant to give new customers deep discounts, as that creates less profit and creates a customer that will just continously want more discounts, and perhaps generate no profit. OTOH, a steady customer is worth discounts, if those discounts are neccesary.

The brand shopper is the same thing, and most people are familiar with this. Each person may pay a different amount for the similair product due to coupons and sales and variation of pricing between brands. Some people will buy whatever brand for which a coupon is available, or whatever brand is on sale. Others will stick with a brand. The fact is one pays a different price for the essentially the same product. Even small geographic differences affeect price.

What i think is happening is computer logic allows the volume retail chain to apply the principles of lower volume sales chains.

I do however think these variations are going to be small because any online retailer who charges too much is going to risk losing customers in the extremely fluid internet market. A firm like Amazon, who goes through a great deal of trouble to make it easy for customers to stay, is not going be seen as the highest price retailer on the planet. Likewise, since it offers good service and selection, it is not neccesary for it to be lowest.

As always it is important to consider if the advertised product and service is a value. For instance, it is quite common that the bigger container of product is actually slightly more expensive. For example, 8 ounces of something might cost $.99 and 16 ounces might cost $1.99.,

Re:common sales practice

[fishbowl]

>For example, 8 ounces of something might cost $.99
> and 16 ounces might cost $1.99.

I'm not really seeing the problem, unless you're saying the one cent roundup is arbitrary.

Re:common sales practice

[fishbowl]

Maybe I'm just losing you because the one-cent difference is not significant.

I suppose, if I tried, I could think of examples where the price of an increased volume of a product is not a simple linear relationship. Or where demand for the larger size is smaller than demand for the smaller size, creating some liability for the merchant. Or maybe something irrational, like a tax, could be at work.

I haven't actually observed the phenomenon you're reporting. Commodity products are proportionally less expensive in larger volumes.

Two AA batteries are usually going to be more expensive than a box of twelve. I need to go grocery shopping soon. I'll report my findings.

Oddly enough...

[fallscrape]

That's why I don't ever just buy from one shop. Loyalty points, rebates and special offers do nothing to change my shopping habits. If they're reputable, cheaper than everyone else and have good customer service, I'll buy with them.

Thanks to pricematching sites, I never have to be stuck to one site ever again.

People are idiots

[Nytewynd]

From TFA:

More than two-thirds of people surveyed also said they believed online travel sites are required by law to offer the lowest airline prices possible.

WTF? Why would online sites be required to offer lower prices than a normal travel agency? Why couldn't they make more profit if their demand was higher? Required by law to offer the lowest prices?

The bottom line is that any service can charge basically whatever they think someone will pay. As long as there aren't fradulent claims (such as a "guarantee" that their price is the lowest", they can charge double the value if they think it will sell.

Normal stores off incentives to returning customers. I get money back at Macy's when I shop there. That is the same as Amazon offering me a better price on a DVD because I am a frequent customer. People get all riled up over things on the Internet that happen every day anyway. Same thing with credit cards online. People are terrified of typing in their credit card number over HTTPS, but will hand their credit card to a random 16 year old kid standing behind a counter.

Re:People are idiots

[iggymanz]

actually, that phrase "guarenteed lowest price" has so many loopholes and caveats that you will see more than one competitor use it for the same goods at different price, without any possibility of being accused of fraud. Or the phrase "largest online dealer", which could actually mean several things. Even "your money back if not fully satisfied" might not mean what you think it does (read that fine print!)

Re:People are idiots

[SirCyn]

Even with that lowest price guarantee there may be a loophole, you always have to read how it is enforced.

One of the travel sites (don't remember right now) has a low price guarantee, but the guarantee is that they will beat anyone else's price if you find a lower one. This does NOT mean the their price is the lowest; even though it's advertised as a low price guarantee.

The real problem here is that they are guaranteeing nothing to begin with. Just that they will act competitively when compared against another business. Any business should do this (within reason).

Re:People are idiots

[fishbowl]

>More than two-thirds of people surveyed also said
>they believed online travel sites are required by
>law to offer the lowest airline prices possible.
>
>WTF?

When I first read that, I wondered if it's giving all the details. In particular, I wonder if the site in question, in the survey, has somehow made a representation that it *did* offer the lowest airline prices possible. If you make that representation explicitly enough, it might very well get into illegal territory to fail to perform as promised.

My favorite example of this is...

[doublem]

I know what you mean. The first time I used ebay was to buy a WinCE clamshell device. I also wanted to get the memory chip to upgrade it's install of Wince to 2.0 (It shipped with 1.0)

So I found an auction on ebay. Several as a matter of fact, all from the same company. The chips were selling for $90 to $125 a pop. I was a bit put off by this price, and decided to click the "Buy this item direct from our web site" link in the middle of the ebay ad.

This link was in large type, easily five times the size of the surrounding text, red and blinking. Kinda hard to miss.

They were selling it for $25 from their web site.

I can i\only image the laugh they were getting form the ebay auctions. They were doing everything reasonable to make it easy for people to get the lowest price they had to offer, and yet people were paying five times that because they couldn't be bothered to click a link in the middle of the damn ad.

Re:My favorite example of this is...

[GQuon]

I would think that offering the items in an alternative way would violate the ebay terms of service.

Re:My favorite example of this is...

[doublem]

It might have done so, but then they were closing about a dozen auctions a day, so I doubt ebay was all that concerned. Besides, this was during It's first or second year of operation. People got away with a lot back then.

Luxury vs Others

[sallgeud]

Your comments about car dealers ring very true. Infact, I'd say the primary reason I currently own a german car (and it's the 5th from the same dealership)... is because of the way I was treated.

In more recent experience, I've found that for some reason, the luxury german dealerships (MB, BMW, Audi) are much more friendly and forthcoming than those at the Japanese or American dealerships.

When I was younger (18), I walked into a Honda dealership looking to buy a new civic. I could easily afford it and already had a loan worked out [which I didn't tell them...]. The dealer had the balls to say to me, "Maybe we should look for something cheaper, used."

He could have sold me a Civic that day... but instead I bought a VW, since the dealer was respectful and helped me find the car *I* wanted.

A few weeks back a friend and I calculated the total dollar sales this dealership made as a direct result of people I sent there, who would have otherwise never considered VW or Audi or would have not used that dealership...

The total? > $1M

Needless to say, when speaking with them recently about a new car purchase, they offered me almost 40% more than any other dealership for my trade... and gave a better price on the vehicle I want.

I have some loyalty to them, because they have treated me well (even under new [evil] ownership). But, I still shop around, because there's no point in paying more when you don't have to.

Re:Luxury vs Others

[nojomofo]

That's funny. I had almost the same experience at a Honda dealership when I was 21. I walked in, and wanted to be shown new Accords and Civics. The saleswoman didn't explicitly say anything, but instead of showing me new cars, she started showing me used cars and wouldn't, no matter what I said, say anything about new cars. So I walked out, went to an Audi dealership and they were very happy to sell me a new A4.

Price discrimination

[sjbe]

Volume deals for corporate customers I can understand, but blatant price discrepancies just because you browse a site differently than another single customer is bad business. I don't know if I would consider it illegal, but it is definitely unethical.

Why? I'm not trying to be trite but I see no ethical dilemma here. What you are talking about economists call price discrimination and it is not only not illegal (in most cases) but I would argue it isn't unethical either. (with appropriate exceptions for things like gender or racial discrimination which are genuinely harmful) If you as a customer are willing to pay a higher asking price without any effort at negotiation or alternate sourcing, where is the ethical dilemma? No one forced you to buy from that vendor. It's not as if you can't get a perfectly adequate computer from someone other than Dell. Small businesses are generally willing to pay a different price than large businesses or home consumers. Why shouldn't Dell charge more to those willing to pay it?

Price discrimination makes many people (us Americans in particular) uncomfortable because we have deeply seated notions of "fairness". If I don't get the same price as you we seem to feel that is somehow unfair. But in reality most prices for goods and services are negotiable and we probably don't have the same williness to pay. If I'm willing to pay more for something than you are, what is unethical about someone selling to me at a higher price? Especially if I'm too lazy to look for a better deal. I'll be honest, I don't really care if an LCD monitor costs me an extra $100 if it does what I want and I can get it when I want it. You may feel differently and that's fine, but it doesn't mean I'm being screwed because I'm willing to pay more for convenience or service or even a brand.

Re:Price discrimination

[badmammajamma]

I agree, it's not illegal and I can't see anything unethical about it either. I don't think anyone would bitch if a site offered them a price 10% less than most people simply because they are a frequent customer. They only complain if the price is higher than what someone else paid.

To me, this is simply an online form of negotiation or haggling. In many countries, there's simply no such thing as fixed prices. It's whatever you can negotiate. Online, if you can google up coupons or discount sites to find what you want then what's the harm?

The moral of the story is: it pays to shop around. Gee, what a strange concept...

Re:Price discrimination

[robertjw]

But in reality most prices for goods and services are negotiable and we probably don't have the same williness to pay.

When my sister was in college one of her professors had his students go into a local retail store and attempt to negotiate a price. It is amazing how often you can renegotiate a price at a store like Wal-Mart. Most people would never even try, but the students in this professor's class were often successful.

Re:Price discrimination

[NtroP]

If I'm willing to pay more for something than you are, what is unethical about someone selling to me at a higher price?

I agree. This doesn't exactly match what you are saying, but I recently purchased a non-restored, classic muscle car that I had my eye on for some time. I had a price in mind that I was willing to pay for it. When the owner finally relented, it turned out that they were willing to part with it for less than what I was willing to pay - so I bought it. I was happy with my purchase.

Soon after that, I was talking to some acquaintances (who admittedly have more experience and knowledge about classic cars than I do) and was given the impression that I might not have gotten the "deal" I thought I had (based simply on their experience and a verbal description of the vehicle). At first I was dismayed. I felt that I'd been taken, but then I realized, "Hey, wait a minute, nothing has changed. I wanted the car. I was happy with what I paid for it. I'm enjoying the hell out of it. What's the problem."

As it turned out, after having the vehicle actually inspected by an expert I discovered that it was in much better shape than it had a right to be (for being 35 years old) and that all the important VIN numbers matched and that there hadn't been any after-market body or engine modifications to speak of and almost no hidden rust or damage . It turned out that I actually had a better deal than I even thought from the beginning. But regardless I was happy with the purchase and it performed beyond my expectations and I got it for less than what I was willing to pay for it. Why should it upset me if someone else might have been able to get it for less. Good for them! Now this is a little different than buying a new commodity item online - it's a relatively rare and unique, used item - but as long as I got what I was expecting for a price I was happy with, that's what counts. What someone else "might" have gotten a similar (or the same) product for should in no way affect me.

I'm selling my classic class-A motor home. If I sell it in the paper, I want $4,500 for it. I have a friend that expressed interest in it that I quoted $3,000 for it. My wife has a coworker that is in need of one for a very specific thing and is in bad financial straights, I told her I let it go to him for $2,000, no money down and take payments. Should my friend be upset? $4,500 is less than market value and I won't go much lower than that on the open market. If a friend of mine approaches me I'd sell it to them for $3,000 or so. If my neighbor's house burned down I'd give it to them for $1. No-one should feel gypped.

The whole situation reminds me of a time when a coworker got a raise, but was reluctant to discuss it with me because they thought I'd be upset. I said that I was happy for them. They deserved it. They asked why I wasn't angry about it since I hadn't gotten one and I said "Did they take your raise out of my paycheck? Am I suddenly making less money now? Why shouldn't I be happy for you? Nothing has changed for me at all - besides, rich-boy, you buy lunch today"

Re:Price discrimination

[angle_slam]

I'll be honest, I don't really care if an LCD monitor costs me an extra $100 if it does what I want and I can get it when I want it.

That's totally different. I am also willing to pay an extra $100 to get a "better" monitor. But the post you replied to talks about paying an extra $100 to get the exact same monitor.

Re:Price discrimination

[NtroP]

My friend is not in the same financial hardship that my wife's coworker (friend) is in. At $3,000 the motor home is a steal. My choice to show compassion to someone who is going through a tough time and currently needs a reliable motor home (not for "camping", btw) should have no bearing on the good deal I'm willing to give my friend who wants a motor home, can afford one, but doesn't need a motor home.

If my friend can't understand that, then maybe I need to be more careful choosing friends.

Re:Price discrimination

[ohtoberich]

Good for you! I recently read "The Paradox of Choice" that describes two types of people: maximizers and satisficers. Its conclusion was that people who are satisfied with what they get are happier than those who continually search for something better. Although the satisfied people are quantitatively worse off, they are qualitatively better off since they are happier.

Re:Price discrimination

[lotsotech]

You don't really *need* a motor home, that's probably why they're in a bad financial situation.

Re:Price discrimination

[karlandtanya]

Posting with too many tabs open?

Re:Price discrimination

[timeOday]

Why? I'm not trying to be trite but I see no ethical dilemma here. What you are talking about economists call price discrimination [wikipedia.org] and it is not only not illegal (in most cases) but I would argue it isn't unethical either.

Here's my problem with it: it's bad for consumers.

The reason markets work well for consumers is because the market sets the price. Even though there isn't time for an individual to research every purchase, they don't have to, becasue so long as a certain percentage of consumers do notice, the price will be competitive.

Price discrimination places the burden of researching every decision on individual consumers. The end result is we all waste a lot more time researching every little decision. Even getting a price quote for competitive pricing is more difficult, because nobody will give you a good quote until you give them a blood sample (figurative). And since time is limited, I argue consumers probably end up paying more on average.

Re:Price discrimination

[raju1kabir]

That's totally different. I am also willing to pay an extra $100 to get a "better" monitor. But the post you replied to talks about paying an extra $100 to get the exact same monitor.

Yes, that's the idea with price discrimination: You try to separate your price-sensitive customers from those who are not so price-sensitive. You give lower prices to the price-sensitive ones, so you don't lose them to your competitors, but you charge more to the rest, to keep your profits up. Since no customers will identify themselves as not being price-sensitive, it's usually done by making near-cost-neutral differentiations between versions of the same product, or attaching artificial rules at various price points.

For instance, airlines often charge more for round trips that don't include a Saturday night stay, even though it obviously doesn't cost the airline any more to fly you back this week than it will next week.

Another common example is different-sized packages of the same item. In US supermarkets you can normally find Lucky Charms breakfast cereal in three sizes. The largest size costs about half as much per gram as the smallest size.

After taking into account the cost of packaging, what's going on here is textbook price discrimination: Consumers who are price-sensitive will buy the large box. But a number of others will choose the small one for whatever reasons, signalling that they care about some other factor more than price.

I don't think you'll find many people who will place an angry call to the attorney general because they bought two small boxes of Lucky Charms and thus paid twice as much as the person who bought one large box. But that's because it's a form of price discrimination they're familiar with.

Re:Price discrimination

[cayenne8]

"When my sister was in college one of her professors had his students go into a local retail store and attempt to negotiate a price. It is amazing how often you can renegotiate a price at a store like Wal-Mart. Most people would never even try, but the students in this professor's class were often successful."

I don't buy it....how the hell do you negotiate a price at a place like Wal-Mart, where the price is set in a computer and charged by scanning it at the register??

Re:Price discrimination

[Banner]

Very Wise. Very.

The deal is best that satisfies both (or something to that effect!) we often spend way too much time worrying about what the other guy got when it has no effect on us at all. Grass is greener effect I guess.

Re:Price discrimination

[aclarke]

You know, some people actually LIVE in motor homes. Seen in this light, $2000 for a place to live doesn't sound too frivolous to me...

Re:Price discrimination

[robertjw]

I don't buy it....how the hell do you negotiate a price at a place like Wal-Mart

Hey, I don't make the news I just report it. Students in the class claimed they would get a manager to negotiate with them and sometimes they could actually succeed.

Heck, if you live the continental United States there's probably a Wal-Mart within 5 minutes of your location. Go down there and try it. Report back on the results. You don't have to buy it, you can confirm for yourself.

Re:Price discrimination

[angle_slam]

Here's a pet peeve I have with respect to price discrimination. FedEx. FedEx has different tiers of service. Yet it seems that (with the exception of FedEx Ground, which is a different system), the only differentiation between the services is how long the item spends in the warehouse. I once bought a product on a Monday, but I only paid for the super saver delivery. You track the package online and you'll see that the package is picked up by FedEx on Monday, shipped to Memphis that night, and flown to Oakland by Tuesday. Then it sits there until Friday, when it is delivered--on the same trucks that are delivering the overnight packages sent on Thursday night. (Sometimes it spends extra time in Memphis instead of the local delivery area).

What do you notice? The long delivery, the one that takes the most time and costs the least, actually requires more work from FedEx's end than overnight delivery (because they have to store the item in a warehouse).

Re:Price discrimination

[dmccarty]

Great post, and a great outlook on life. In my opinion the world is made better because of people like you. Thanks!

Re:Price discrimination

[geekoid]

good for you, that a good attitide. But what if they charged you more becasue of where you lived? or your finacial statement? or your color?

what if he got the raise because he went to the same church as your boss?

Re:Price discrimination

[NtroP]

[begin completely off-topic rant]

They are relocating to a new area. They need to transport their belongins and their family a long distance and do not, yet, have a place to move in to when they get there. I won't go into their exact situation as it is noone's business but their own. Currently, the most cost-efective and simplest solution is to travel in a motor home while towing their vehicle with their belongings in the vehicle and on the roof-top luggage rack. This avoid hotel and restaurant expenses since they can eat and sleep in the motorhome. When they get to where they are going and find a place to live they can sell the beast and use the cash to offest the down-payment or what ever.

You may not *need* a motor home any more than you *need* a plane ticket; just walk or get on your fsck'ng bicycle and peddle dammit. Who are you to judge why they are in the financial situation they are in?

If I thought they were just picking up another toy, do you think I'd be throwing thousands of potential dollars away? If I had the money in cash to give them a loan, I'd do it. I don't. This is how I can help out. The same way someone reached out a hand when I was laid off with a 2-month-old baby and no more savings. I could have chosen welfare, but instead sucked in my pride and took some "charity" and a loan that I've since paid back from friends, family and the local church.

I have since recovered and am doing fairly well after digging myself out of that hole. Since then I've taken every opportunity to do what I can for those around me who genuinely need a hand. I don't give money to beggars, and I don't help anyone who isn't willing to put at least as much effort into helping themselves as I am in helping them. Do I have something I could do with the extra money? Sure, I've got a kid starting college in a year. Do I have something better to do with the money right now? No.

I'm not some feel-good, say all the right things, touchy-feely liberal who expects others to do all the giving and the helping; who thinks that by just saying I care, that it makes me a good person. I'm as conservative as you can get and greatly resent it when I see my money going to some welfare-case who lives next to a McDonalds with a help-wanted sign perpetually in the window, yet "can't find a job". That really burns me. But I know there are people who truly need help because of circumstances completely out of their control. I look around and see what *I* can do to help.

And I look around where I am. Why? Because that's the only way I'll *know* what help is really needed. You made a snap judgement from thousands of miles away without knowing the situation and determined (incorrectly) that it was an unecessary luxury item for them. It reminds me of the time when I was little some people came to our village (my parents were missionaries) and took pictures of some of the children running around naked and dirty. Later we found out they were poster-children for one of the "save the children" outfits. The problem was, one of the little girs was the daughter of the village elder. Boy would he have been upset if he found out his little girl was the "poor" child everyone was supposed to send money for (especially since he wasn't getting any). See, the problem was everyone was trying to help a problem a thousand miles away when they didn't even know the situation. They might be better to spend their money and efforts closer to home and offer help in a manner that really met the need. Cash is not always the answer.

But no, it's easier to write a check and feel absolved. Or vote for more "federal programs" (since it'll mainly affect the rich, who should be doing more anyway).

Aw, hell. What does it matter anyway? Wasn't this whole thread started because people were feeling outraged because someone else got a "better deal" than they did - regardless of whether the other person might have worked harder ( or bagained better, or was a dependable repeat customer, or was somehow in a target audience, etc.)?

[end completely off-topic rant]

Re:Price discrimination

[NtroP]

But what if they charged you more becasue of where you lived? or your finacial statement? or your color?

Heh, I live in Alaska - talk to me about charging me more because of where I live! I can see it because of the cost of shipping, etc. That makes sense. What doesn't make sense though, is that I live 500 yards from the Alaska Pipeline and 3 frickin' miles from one of the refineries, but I pay more for my gas than almost everyone in the Lower 48! Last time I filled up it was $1.29 a gallon for unleaded and almost $1.40 for premium.

So yeah, I can see an instance where it could feel unfair. But, on the other hand, I live in Alaska, so I have that benefit too. It's hard to put a price on that :-)

As far as discriminating against race, religion, etc. I think that sucks and I'd really hate to think that still goes on. But, I can imagine, if I were a shop owner that I might give my regular customers a break, or those who paid me in cash, or a discount to mothers on mother's day or on their birthday, etc. I can see where having different prices for different people for the same item might make sense. I'm not a shop owner, though, so maybe I'd find that I couldn't do that so easily. I don't know :-)

Re:Price discrimination

[crgrace]

You think that is a lot to pay for gas? I paid 2.39 a gallon for unleaded today in California.

Re:Price discrimination

[jemenake]

What you are talking about economists call price discrimination

Right, and, before I give some examples, I'll tell you a little story.

When I was taking Econ in college, the professor drew the little downward-sloping "demand" curve on the Price-Quantity graph and showed how you usually want to set the price to some point on the demand curve such that it forms a square underneath with maximal area (since the area equals your total revenue). It quickly dawned on me that it sure would be nice if you could capitalize on *all* of the trianglular area under the "demand" line. In other words, charge $100 to the one guy willing to pay that much, while still charging $10 to the 30 people only willing to pay that... and then charge $4 to the hundreds of folks willing to pay that.

My professor just kinda waved his arms and said... "yeah... that would be nice...". Only later, did I learn that this is called "Price Discrimination", and it's very cleverly used in the following ways.

Haggling. This doesn't seem like the insidious form of PD, but it *is* PD, nonetheless. Think about it. The seller is deliberatly adjusting the price according to how much he/she thinks they can get out of you. However, the fact that the buyer understands that this is the arrangement makes them feel like there's no deception happening. But it *is* PD.

Outlet Stores. Admittedly, part of the reason for lower prices at outlet stores is because they're in out-of-the-way low-rent locales, and also because they're often selling blemished items. However, another reason they're cheaper is *because* they're usually out in the boondocks. If you're an affluent customer, it's not worth it to you to drive 15 minutes each way to save $15 on a pair of pants (or to save $15 by buying a blem). You're just going to pay the premium to buy from a nearby store. However, if you're on welfare, living in the trailer park, then it's well worth it to you to drive for a while to save a little money. This way, the companies are able to sell their pants to poor folk, without having to give the rich people the "poor folk" price.

Premium gas: High-octane gasoline only costs the gas station an extra penny or two per gallon, yet they charge an extra 10 cents or so. This is because the people who self-select premium fuel do so either because they're affluent and like to feed their car "the good stuff", or they own an expensive car which requires it. Either way, they've identified themselves to the gas station owner as being well-off, and the station owner gouges them a little more.

Airplane tickets. This is the biggie. Ever noticed how you have to pay a lot more for round-trip tickets if you don't stay over a weekend? The reason for that is because, if you're not willing to stay over the weekend, you're probably not a vacationer; you're a *business* traveller... probably going to some meeting or conference. This means that you're spending the company's money on the ticket... which means that you're less sensitive to price. Who wouldn't be willing to burn an extra couple of hundred dollars in order to be home with the wife and kids for the weekend? However, if you *are* willing to spend the weekend, you're probably vacationing... which means that you're spending *your* money, where price is a bigger factor.

PD is all around you. It's legal. You could argue that it's "unfair", but I wouldn't agree. The seller and the buyer are adversaries. The seller's trying to get as much money as they can... and the buyer is trying to part with as little as they can. If either thinks that the deal isn't good for them, then the deal doesn't happen. If both think that the deal *is* worth it to them, then it *does* happen. That's the fundamental tenet of the free-market economy: all mutually-beneficial exchanges are allowed to take place.

Those who say that PD is unfair are probably the same people who, if they owned a retail store, would claim that it's unfair if a customer walked in with a few mail-order catalogs for price comparison.

Re:Price discrimination

[Katharine]

I personally have negotiated lower prices at major department stores and chain stores. It is more successful if the item to be purchased is the last in the store. Note, I have not tried this at Wal-Mart because the nearest one is over an hour away and I never shop there.

Typically it works best if you give them a reason to give you a discount: "Excuse me, major chain bookstore manager, this book is damaged (book is shopworn) and it is the last copy in the store. Will you give me a discount?"

Or point out that the sale starts tomorrow or ends tomorrow, and wouldn't they like to make you a happy customer and give you the lower price. But once in a while you can get a lower price just for asking without any "justification," it depends on the store.

My grandmother is the one who taught me to do this. She always said that it never hurts to ask.

Re:Price discrimination

[Katharine]

I meant to say, "the sale starts tomorrow or ended yesterday."

Re:Price discrimination

[QuaZar666]

umm no you pay much less for gas than everyone in the lower 48. I am in Texas and paid $1.95 last weekend, 4 months ago I lived in Missouri and paid $1.80 for gas. I can only wish to pay $1.29 a gallon.

Re:Price discrimination

[cicho]

"I don't think anyone would bitch if a site offered them a price 10% less than most people simply because they are a frequent customer."

It's like saying "no-one would bitch about stolen elections if it was their party that stole them". It's sadly true - not many people bitch that way.

Well, I for one would bitch about getting a lower price, because it would indicate that at other times I'm probably getting higher prices, and so ultimately I cannot trust the vendor.

Re:Price discrimination

[NtroP]

Sorry, That should have been $2.29 and $2.40. It must be that I'm still in denial.

Timely Article

[Arrowroot, son of Ar]

This was a very timely post. Yesterday I ordered a Pantone Colorvision Spyder2. I saw it posted on a Pricegrabber-like service for $151 so I ordered it. When I got the confirmation message, I was pissed that it wouldn't ship until next week. I went to the same service from my home PC and it was $70 higher across the board.

the opposite extreme

[iggymanz]

is price fixing, would you rather have that? Not me, I'd rather hunt around for a good deal for major purchases. It's worth it, you can get 20%+ more gear that way!

Discounts?

[Antony-Kyre]

Some loyal customers get discounts, but consider this for a moment.

You're going to buy cable television. They offer it to you for $29.95 per month or whatever, then they spike the price. This would be the exact opposite of the whole loyal customer thing, right?

Re:Discounts?

[Antony-Kyre]

I think you replied to the wrong post or something. Not sure how that happened. I know slashdot has been having a lot of problems in the past couple days.

Why is this a surprise?

[paesano]

Why would the practices of online retail be any different than the practices of traditional retail stores? When I sold auto parts for a living, there were at least 5 prices for any particular item, depending on who it was buying it. There was the "white" (list) price for the customer you did care for, then there was the "pink" price that you used for the average Joe, then the "yellow" price that you used for your good repeat customer, then the "green" price for the mechanics, and finally the "golden rod" price for the mechanics that you had to steal from your competitor. Nothing new here.

Prices I understand, but availability??

[Markee]

While I understand why a seller wants to offer the same thing at different prices for different customers (although I don't think it is ethical), it eludes me why they would want to present different delivery dates to different customers.

A while ago I was looking for a certain book. I came across a link to the same book sold at http://www.amazon.de/ (the German Amazon shop). I followed the link twice, but with two different browsers. I ended up looking at the same page with two different browsers, each with its own history and cookie cache. In one window I was presented with 1-2 days availability, in the other one I was told it would take 3 days. I reloaded both pages at the same time to rule out that any change in data was the cause for this. After I cleared all private data on both browsers, both showed the 3 days availability.

The only difference I can think of that Amazon could take into account for calculating the date is the data stored in certain tracking cookies. I don't have an Amazon account, so they can't have used my past buying behavior pattern, or even identified my as a previous customer.

I feel this behavior is hard to explain and unethical. It leaves me with the feeling of being lied at deliberately by an online shop, just based on their prediction of my buying or complaining behavior.

Re:Prices I understand, but availability??

[Anonymous Coward]

I suspect you're seeing real-time inventory in action.

Re:Prices I understand, but availability??

[Markee]

I suspect you're seeing real-time inventory in action

I doubt that because, as I said, I reloaded both pages at the same time, several times, to rule out any data change.
And if the web shop's availability forecast should oscillate on a sub-second basis, what value should it have to the customer?

Re:Prices I understand, but availability??

[GQuon]

Did you just press reload, or did you force a reload with Crtl or Shift and reload?

Re:Prices I understand, but availability??

[smoker2]

It was probably because the stock levels were reflecting interest in the product, so the same item might take longer for a later "browser".
I've frequently been in the process of ordering some pc parts when at the final stage of checkout, 1 or 2 items have suddenly become out of stock. Generally, if I leave it an hour, they will come back into stock, because someone else has deleted items from their cart.
Basically one of your browsers was at the front of a queue, and after deleting the cookies (hence the cart/interest in the product) you joined the back like everyone else.

Sad State of Affairs

[Shamashmuddamiq]

Nearly 2/3 of adult internet shoppers thought that practice was illegal...

This just exposes the mentality of the average internet user: if something is bad for them, they expect it to be illegal. They expect the government to take full responsibility for their well-being, and this is why government (the US government, at least) has gotten so big.

I was reading a front-page article in my city's newspaper the other day. A "mentally disabled" woman walked into a retention pond and drowned. The response from the journalist was not to blame the caretaker of the woman, nor the gate that she passed through to get to the pond, but the pond itself, and the government that allows retention ponds to be built without fences around them!!!

*shakes head*

Why fixed price retail is bad

[G4from128k]

Fixed price retail was invented because retailers did not have the skilled staff or the IT to offer dynamic/negotiated pricing. It is really only a temporary phase in the evolution of retailing.

Customers may hate paying different prices, but it is the only way to both maximize the number of customers that can buy a given product and fairly allocate profit (difference between the value received and price paid) across both the sellers and the buyers. In a fixed-price system some extremely wealthy buyers get a great deal (i.e., they would have been willing to pay far more) and extremely poor customers get nothing (i.e., they cannot afford the fixed price). If you work out the math for the system, you can show that different customers paying different prices maximizes the total number of customers that can afford the product and maximizes profit for the seller. In a competitive marketplace, maximizing profit is actually lets companies offer goods at lower prices because a profit-maximizing strategy lets a company undercut the competition.

Dynamic pricing also lets a company change prices to reflect the fact that some customers are more expensive than others.

Um

[Bandit0013]

If you want to run a profitable business you will charge the maximum that the customer is willing to pay.

I don't see anything wrong with this. You can't blame the business for taking advantage of people who aren't willing to shop around.

If you read the study...

[borkus]

...you find that it's more about customers' knowledge than about actual industry practices.

Targetted pricing is hard to do for any item that can be purchased at multiple retailers. Dell can do it since they're the only ones who sell Dell products (no way to comparison shop). Likewise, retailers with exclusive product lines (for example, clothes) can do this as well.

What's more interesting isn't the pricing ignorance but just general privacy ignorance. You'll need to go to the end of the study for the summary, but it has some really interesting numbers. For example -

• When a website has a privacy policy, it means the site will not
  share my information with other websites or companies. Correct answer - False 75% wrong
• The Federal Trade Commission will correct errors in credit reports
  if it is shown proof of the errors. Correct answer - False (You have to fix it yourself) 76% wrong
• when asked "Can you give me the name of
  national Credit Reporting Agencies that can give you a copy of your credit
  report?" 66% of the respondents could not name any of them.

In short, consumers know little of what laws protect them and where they are vulnerable. With that level of ignorance, consumers are unlikely to press for better privacy regulation or report violators of the current laws.

Free Market

[rsynnott]

This is a natural part of a free market economy. The same people who are complaining about this would also complain about a planned economy. Moral of the story: you can't please all of the people all of the time.

I just brought this up on /.

[ImaLamer]

Wal-Mart doesn't have the same price as their on-line store. Target doesn't even carry the same products. Two examples; Matrix Reloaded was 15.95 online (walmart.com) the day it went for sale, yet at the local Wal-Mart was selling copies for 21.98 - Target sells Divx certified DVD players online but doesn't list the Philips DVP642 (classic) where it can be bought at the local store.

Your audience is different. I'd say instore shoppers are naive about instore products and prices. Because of the Internet you can buy things from anyone, anywhere. Your options are not the local department store shelves anymore. But I would say that online prices are due to the overall market's supply and demand pressure - where Wal-Mart stores will "rollback" prices throughout the day.

I say anyone paying too much for something on the internet is a fool. It is easy to establish what an item *should* cost by using a number of shopping search engines. I'll never buy another piece of electronics on a whim - you can have much more when you do your homework.

Re:I just brought this up on /.

[Deflatamouse!]

This is simply the laws of economics. Businesses will charge the highest price they can get away with, and consumers will pay the lowest prices they can find within reasonable means. Whether online or offline.

Exactly, the audience is different. A Walmart in a rich neighborhood can probably get away with charging higher prices than a Walmart in a poor neighborhood can. If the consumer will take the time to drive to the poor neighborhood Walmart, then the lower prices is well deserved. (But perhaps it's not worth the risk of driving an extra 30 minutes through a high crime neighborhood?)

Oftentimes, the websites of stores like Walmart, Target, Circuit City, etc., will ask for your zip code. I am going to try and give it different zip codes within the same metropolitan area and see what price differences there are.

Re:I just brought this up on /.

[Carnildo]

My experience with grocery stores is that it runs the other way: the store in the poor neighborhood charges *more*, as a poorer customer either doesn't have the time or doesn't have the tranportation to shop around.

Re:I just brought this up on /.

[ImaLamer]

no... my point is exactly the opposite

At the local, middle-class Wal-Mart, poker table tops that sell for $50 now were selling for $15 during Christmas time. Wal-Mart's stores operate using JIT stocking and the demand was high. Instead of being stuck with thousands of these things they priced them with no markup (I assume). If people are coming in to buy the cheapest poker table top in town they are likely buying other things, where the highest selling items are competitively priced due to the inherent flexability in their system. At those times much of the advertising is word of mouth, and it gets around when people come back from the store.

The Internet shopping beast is another story. Prices reflect what people expect to pay worldwide. Anyone over the price limit will not generate business.

Doesn't Dell do this?

[alcmaeon]

A friend of mine and I were arguing about the relative costs of Macintoshes vs. PC's (the eternal debate) and I specced out and priced a Dell and sent him the results. Later that same day he tried to spec and price the same Dell and got a different price.

There is a possibility that he screwed up, but we both assumed that Dell was varriably pricing the computers.

Anyone know if this is Dell's practice or not?

Re:Doesn't Dell do this?

[toddestan]

Something to keep in mind is that it seems Dell likes to change their prices almost hourly, especially with the specials they run. Though, if Dell was practicing price discrimination, it wouldn't surprise me in the least.

You know, now that I think about it, charging people more who are browsing Dell's website with a computer running OSX would be a move of sheer brillance on Dell's part.

Re:Doesn't Dell do this?

[russotto]

I don't think Dell charges people using OS X more (I just bought a Dell and when I was looking up prices I used both OS X and WinXP machines at different times).

However, they do charge differently depending on the path you use to get something. They might have one ad on their site for an "OUTRAGEOUS DEAL" and another which screams "$100 rebate" -- both will let you configure the same system, but for different (sometimes VERY different) prices.

For instance, the same Dimension 3000 system from Dell Small Business is now available for $479 or $767 depending on how you get there.

price discrimination

[t_pet422]

It's called "price discrimination:" Get each potential buyer to pay as much as they are willing to pay. From a business perspective, it's smart. From a consumer perspective...be aware. It's not really a "shady" practice. It's the same as haggling with someone, just that the "someone" in this case is a sophisticated computer algorithm.

if your not doing anything wrong...

[hosecoat]

I think this is one reason privacy is important. This is at least limited to the individual sellers. If a large group of them got together, tracking purchase patterns (something like a credit card company can do), they can figure out the best way to exploit the most money from you. They segment the market just like airlines, where everybody on the same flight pays a different price.

Illegality and the Robinson-Patman Act

[Otto]

What you are talking about economists call price discrimination and it is not only not illegal (in most cases)

I would argue that it's possible to interpret the Robinson-Patman Act in a way such that price discrimination like this *is* illegal, in the United States. It may not be prosecuted much, but the law seems pretty broad and could be interpreted to cover this sort of thing.

Re:Illegality and the Robinson-Patman Act

[ajnsue]

Hmm - my understanding was that the Robinson Patman act was designed to prevent predatory pricing. This being the issue with large oil companies that forced out smaller oil companies by artificially selling oil cheaper in one region while charging higher prices in areas where there was no competition. www.ftc.gov/speeches/other/patman.htm Culturally, Americans like the Fair Deal concept. Other cultures find the "Fair Deal" concept laughable. They see it as a problem that Americans don't value money enough and that if you are dumb enough to spend too much - or conversely if a business is dumb enough to be duped into accepting a dishonest product return in the name of customer service. Well, then you deserve it.

It bothers me. . .

[ducttapekz]

This article and all the comments are making a big deal out of this but note that there are only two concrete examples of this practice in the article. Out of these two examples, one of companies offered a refund to the customers who paid a higher price. This "practice" occurs significantly less than the article implies and certainly less than the summary implies. Everyone complaining about this needs to rta. The summary of this article is also misleading, this article is about consumer ignorance of online and offline shopping and credit. Most of the data in the article is based off of survey statistics and not facts.

Ever buy airline tickets online?

[pclminion]

A few months back my mother was looking to purchase airline tickets. I don't remember which travel site she was using, but as she examined different fares, the rates kept changing (mostly increasing) and she had no idea why. Being a cynic, I told her to delete all her cookies. Unbelievably, this caused the fares to reset back to "sane" prices.

If you buy travel tickets online, be aware that the prices will basically go up as long as you "dilly dally" while booking a flight. These sites use cookies to track individual users and punish those users with higher fares in certain circumstances. To get the prices back down to normal, clear your cookies.

Re:Ever buy airline tickets online?

[mcmonkey]

A few months back my mother was looking to purchase airline tickets. I don't remember which travel site she was using, but as she examined different fares, the rates kept changing (mostly increasing) and she had no idea why.

A tip aside to your mom, I don't know of any airlines that don't sell ticket from their own websites--without any fees (above the standard taxes and security garbage and such). So after you do your searching and price comparisons on Expedia or Orbitz or whatever, make the actual purchase directly through the airline and avoid the fees from the travel site.

I've done this a bunch of times and never found a fare on a travel site I couldn't get directly from the airline's own web site.

Re:Ever buy airline tickets online?

[Politburo]

Right.. but you can save a bunch of money getting airfare+hotel together on the travel sites now.. at least that was my experience earlier this year.

Re:Ever buy airline tickets online?

[ignorant_coward]

but you can save a bunch of money getting airfare+hotel together on the travel sites now

Go away you gnome! You completely ruined my experience watching that race around the world!

Re:Ever buy airline tickets online?

[ignorant_coward]

Resetting your DSL/cable modem or re-dialing in to get a new IP address probably wouldn't hurt, either.

Re:Ever buy airline tickets online?

[Vitriol Angst]

About a year ago I was looking for airline tickets on the usual web aggregators. I found about $175 for a ticket to Miami. Later, when checking the price, I couldn't find any for less than $250.

When I later used a computer to check again at another office, the price was like $190.

I thought I was savvy, but your comments just made this click for me... wow, what a dirty trick. They know you are interested, and by slowly upping the "bid" each time you access the site, they are making you think you've got to hurry up and buy before it's too late.

Next time I fly, I'm going to pocket as many extra peanuts as I can swindle out of the attendant!

It's all good--if it's profitable

[Urusai]

Since most people seem to take the stance that companies are justified in their evil ways because it "benefits the stockholders", thereby elevating capitalism to the status of a moral/religious system, we can just say that these web sites are an example of the finest capitalism, feel all warm and fuzzy, and go back to being exploited, sheep-like consumer drones.

Re:It's all good--if it's profitable

[Detritus]

Actually, I think it's bad for capitalism. How can you have free and competitive markets when buyers can't share pricing information? It reminds me of when I went shopping for a new bed. The manufacturers and retailers had colluded to setup a system where every retailer had a unique set of products, even though they all came from the same factories. Store A is selling a Sealy Snooze King for $300. Store B doesn't carry the Sealy Snooze King, but they have the Sealy Slumber King for $350. It's very difficult to compare prices if you don't know which products are the same, even though they are sold under different names.

Re:Really? I don't believe it.

[pclminion]

Look up airline tickets.

What on earth is wrong with 'my attitude'?

[goldcd]

You make money in business/consultancy/whatever by getting yourself customers and retaining them, whilst extracting as much profit as you can from them.
If you need customers, then sell something at cost to get them through the door - surely nothing wrong with that.
When they keep returning asking to buy from you, then sell to them at a price that gives you a profit, but keeps them coming back.
If you gouge them and they feel cheated, then they'll leave and not come back - but there's no point carrying on selling at cost, unless you've got a way of recouping lined up.
You're in business to make money.

&^%$#@! marketing droids..

[EvilStein]

"They are known within the industry as "bottom feeders" who don't show any brand or merchant loyalty."

No, lawyers and marketing dicks are the "bottom feeders." the rest of us are just trying to avoid getting screwed by both parties.

Re:&^%$#@! marketing droids..

[ignorant_coward]

I am completely a "bottom feeder". It isn't like I'm made of money, and saving 20+% on groceries by buying only store brands and only things on sale is a big deal to me. The fact that stores still put $15/lb steaks in their displays shows me that there are clearly people who are not bottom feeders. If the stores bitch about this diversity, then that just shows what greedy assholes they are.

Re:&^%$#@! marketing droids..

[Miriku chan]

tell you what, why dont you go whine about it in your blog? =)

Re:&^%$#@! marketing droids..

[EvilStein]

I'd love to, but "www.pithycommentary.com" was already taken! ;)

Re:&^%$#@! marketing droids..

[DocSavage64109]

I'd mod you up if my points didn't just expire. You are right on the money about the stores bitching about the smart consumers while they scam every dollar they can from everyone else.

0 Balance Customer=Freeloader

[Hoi Polloi]

Credit Card companies make most of their money off of interest charges and fees (such as annual fees for air mile cards). If you pay off your balance every month like a responsible person they consider you a "freeloader".

"Freeloaders" Get Higher Fees

GE Punishes "Freeloaders"

BJs Drops Customers

Re:0 Balance Customer=Freeloader

[ThisOrThat]

Are they any newer articles? The one on GE is about a decade old now and states:

"Other issuers will jump on this bandwagon just as soon as the flak from GE dies down". I am not aware of other credit card companies doing the same thing some 10 years later.

I have never had issues with any of the credit card companies I deal with.

Re:0 Balance Customer=Freeloader

[Hrodvitnir]

I just recently transfered my balance from a Chase card I had and closed the account. The reasons for this were twofold:

1. More than once my bill never came in the mail, causing me to be late on a payment. After the first late payment, I was no longer allowed to pay online, so when I didn't recieve a bill after that I had no way of paying on time.

2. I was automatically signed up for the insurance on the card (no payments/interest if you lose your job, etc.). I did not sign up for that and told them to remove the service from my card. Months later, there it was again!

Needless to say, Chase will never get my business again.

I wonder if newegg does this price variation

[Bruzer]

I wonder if newegg does this same thing. I bought some computer stuff there and I always use my login id to shop when I go back. I wonder if they inflate the price on certain items after they know you are already a repeating customer.

On the other side I always try to compare prices with Frys or pricegrabber.com, but sometimes I admit I am lazy and don't check prices on everything.

Not just online

[Ironsides]

There is this one small collectibles shop I go to frequently. On average I spend a couple hundred there a month. The owner decided to start giving me an extra 10% discount since I buy so much. Sounds good to me and I'm about to drop a few hundred there tomorow. Not sure how many others get the discount, but if someone gives you enough business it can make sense to give them a little extra to keep their business and show them you appreciate them.

Re:Not just online

[HidingMyName]

Recently in our department, we had historically made separate orders for equipment purchases. I had our purchasing revise our approach to aggregate the orders and then called the vendors and got between 10 and 15 percent off on average. The reduced cost of processing and shipping was probably what did it (although we are a regular customer of theirs).

Re:Not just online

[bleckywelcky]

This is very common practice in the contracting business. To the point that it is already programmed into the system. Buy $10k worth of equipment per year? Get a 5% discount. Buy $40k? Get a 15% discount. Buy $10k worth of supplies per year? Get a 3% discount.

It is sort of like a bulk discount, but it's not tied to a specific item. The items themselves have their own bulk pricing, but you get an additional discount on top of that based upon your annual purchases.

Re:Not just online

[Zordak]

I think what people were getting more pissy about is places like Amazon, where they track you with a cookie, and when they see that you are buying from them pretty frequently, they feel like they've got you hooked, so they go ahead and ratchet up the price. I believe that article mentions the story where a guy who shopped Amazon frequently deleted his cookies and got a substantial discount. I don't know that his practice is inherently "evil," but it does make you feel used.

Re:Not just online

[binkzz]

The problem here is that regular buyers don't receive the discount because they'll spend their money anyway.

This whole discusssion is distateful

[markdj]

I find the tone of this whole discussion and /.'ers reactions distateful. While price segmentation is not illegal nor unethical, not telling anyone that a site does that I believe to be unethical and may be illegal.

It's ok to have price differences among different segments of the public, such as seniors versus others, new customers versus repeat customers, etc. What is galling is that these sites don't tell you this. That means the customer doesn't have enough information to do price comparison shopping.

Our system of commerce is based on transparency. The customer has all the relevant facts so that he or she can make an informed decision. When sellers keep information secret that system breaks down.

You cannot haggle on the internet. Most sites do not have a way to offer an alternative price. So the price posted is the one you have to accept if you want to purchase from that site.

Some have said that Dell has two sites - a home user site and a small business site, and that the small business site has consistently lower prices because the two sites are essentially run by separate entities, but anyone can shop at either. Why would anyone use the home user site if that is the case? The answer is that they aren't told otherwise unless they hear it by word of mouth.

This is exactly the kind of situation that the FTC was created to police. Fairness and transparency is the only ethical way and I am not surprised that most shoppers are unaware.

Re:This whole discusssion is distateful

[Mark_Uplanguage]

Just some counter points

I find Our system of commerce is based on transparency. The customer has all the relevant facts so that he or she can make an informed decision. When sellers keep information secret that system breaks down.

Since when did a car dealer provide all of the relevant facts in a trasparent way? MSRP is a joke on most cars, but it's only word of mouth that informed me so, I've never seen anything at a car dealer to make me think I shouldn't pay sticker unless there's some incentive sale or something.

You cannot haggle on the internet. Most sites do not have a way to offer an alternative price. So the price posted is the one you have to accept if you want to purchase from that site.

I don't think you can haggle at a department store. But if you want to haggle with an online entity, call their toll-free number and haggle with the customer help desk.

Re:This whole discusssion is distateful

[Chanc_Gorkon]

And this hits the nail on the head from my point. I personally do not care if you offer a frequent shopper a lower price then new ones or if you have a educational discount for college and primary school students, but BE UP FRONT ABOUT IT! TELL me that if I sign up for your goofy discount card I can get lower prices or TELL ME that once I buy x amount of stuff I get a discount. The Dell practice, to me, seems to be very shady and should be illegal.

Re:This whole discusssion is distateful

[markdj]

That's why car dealers are consistently considered among the most slimy and disreputable sellers. As far as haggling goes, many sites don't have tol-free numbers and answer their e-mail infrequently (Yahoo is a godd example of that). So I still say that haggling with an internet entity is difficult at best. The internet is not setup for that.

Adult Internet Shoppers

[Noxx]

Nearly 2/3 of adult internet shoppers thought that practice was illegal...

Am I the only one who read that and thought they had surveyed pr0n sites?

Wait, don't answer that...

Re:yes, but..

[symbolic]

When I shop, my choices are not brand-oriented at all- they are based on what ever happens to offer the most value. So, club card or not, I still pick the best deals.

I personally think the whole "loyalty card" stuff sucks. I stopped shopping at one well-known chain several years ago because I decided that I wasn't interested in having my every purchase tracked and profiled. I still use a card (at a different chain), but they don't require any personally identifying information.

Joel Spolsky's Camels and Rubber Duckies

[Youssef Adnan]

Joel has an excellent article on how pricing goes on software. Although not very related, this is basically an automated bad idea #2.
http://www.joelonsoftware.com/articles/CamelsandRu bberDuckies.html

Negotiating prices on EVERYTHING

[sjbe]

I'll be honest, I don't really care if an LCD monitor costs me an extra $100 if it does what I want and I can get it when I want it.

That's totally different. I am also willing to pay an extra $100 to get a "better" monitor. But the post you replied to talks about paying an extra $100 to get the exact same monitor.

Where did you read anything about a "better" monitor? Not from anything I wrote. I was specificaly writing about paying different prices for the exact same product. That's what price discrimination is. It occurs all the time, everywhere in the world and it is ok. You want a better price? ASK for it. Odds are you'll get it. If they want your business, they'll negotiate with you since a sale, even at a reduced profit is normally better than no sale at all.

Every transaction is a negotiation. Most things we buy are covered under laws like the Uniform Commercial Code which amount to prenegotiated terms. Don't like those terms? You can negotiate with the other party to change them so long as you don't break any laws in the process. We're just so used to ignoring all the terms of sale that we often aren't aware that we've just conducted a negotiation every time we go to the cash register.

Re:Negotiating prices on EVERYTHING

[cicho]

"That's what price discrimination is"

Fuck price discrimination. Talk about other kinds of discrimination. Like charging higher prices for cosmetics, say, if a woman is buying. Or charging higher prices to teenage kids buying video games (cause they'll be pestering their parents and will often succeed). Or an $ethnic_minority_person walks into a bar and gets asked $100 for a beer. Legal, right?

Price discrimination and bidding should occur only for scarce items. If you have a Picasso to sell, fine. But if you're selling new mass-manufactured goods, price should only be a function of quantity bought. Anything else means the seller is not to be trusted. And don't talk to me about used cars - this is precisely the reason car salesmen are the butt of cruel jokes - because you can't trust them.

re: car dealers, etc.

[King_TJ]

Yep! Back around '98, I decided I wanted to buy a Trans-Am. (Ended up a bad move, since the one I finally got was a lemon anyway... but that's another story.) I went to one of the largest Pontiac dealerships in town and took a look at their inventory.

I was really considering the convertible "Ram Air" model, and they had a red one on the lot that I could have afforded (barely, granted - but would have been doable). The sales guy ignored me for a while, and when he finally realized I was looking at the car too long to just be someone browsing at random - he grudgingly walked over. I asked him about possibly getting a test-drive, and he told me "No way! We only let serious buyers test drive those. There's no way you can afford one of those anyway!" I said "Really? Ok." and walked out.

Went over later that afternoon and bought a black one from a smaller dealership.

Re:Will that's ok, the US Dollar will collapse any

[argoff]

Look, there are trillions and trillions and trillions of dollars that are sitting out there that people, businesses, and governments arround the world have been collecting up for 30 years as the mainstay currency. What do you think's gonna happen when they all decide in a short period of time that they had better loose those dollars beofre they loose too much value? Tell me that hasn't happened in other countries that were in similar situations.

Re:Time for that Near-Fatal Heart Attack Folks...N

[fishbowl]

"the cashier said that the website was no longer an online representation of the brick-n-mortar stores, but now competes with them. Of course Best Buy is not so dumb as to make you buy something from the site and have it shipped, you can get the price on the website by selecting Store Pickup as your shipping option."

I find it very interesting that they are willing to be the delivery point for their competitor. More likely the cashier doesn't know what he or she was talking about. I'll bet you could have pressed the issue with a manager and gotten the online price. I would have simply walked away, unless I *really* needed DVD-R's that day.

Re:Really? I don't believe it.

[Archalien]

I used to work for a company that was an Amazon store and I know for a fact that Amazon does this.

You don't see it from one computer to the other because Amazon is extremely good at tracking users from their servers.

Re:What' the problem?

[Chosen Reject]

I just got back from a 3-week stay in Vietnam. Over there all prices are negotiable. Including that TP that you want after work. If you really need it now (the TP) then you are less likely to bargain and more likely to buy it at what they are selling. The business is happy because they got more money out of you, you are happy because you can be sanitary.

But if you really don't need it RIGHT NOW, and you want a better deal then you haggle them. They will still be happy because they got your business and you will still be happy because you saved some money. Only a stupid business person will sell anything at a loss (unless it will secure your future business).

Having grown up in a country where prices are clearly marked and doing business that way all the time, at first I thought I was hurting their feelings by trying to get a lower price or that I would drive them out of business. But after the long stay you realize that you're only hurting them if they are stupid enough to sell it at a loss. Which, over there any way, they are not that dumb. They've been doing it for a while.

My dad will always buy a new car from the fleet manager simply because they give him a price and he drives away with a car. He might be able to save some money by haggling with the salesmen out front but it's not worth it for him. That's the way some people are. They pay for the cost of haggling with their money, while others pay for it with time and effort. If you want to talk to your power company about each individual watt-hour, that's your choice. They will likely not care, which is their choice. Some sell absolute, some don't. Some buy absolute, some don't. But it isn't a bad way of doing business. It's just "A" way of doing business.

In America, at least, we only really haggle for cars and houses because they cost so much. We just don't like the idea of it so companies have found that bargaining is not the way to keep MOST of their customers happy. That's not a bad way of doing business, either. It's just "ANOTHER" way of doing business.

What about...

[Archalien]

I don't find this to be as much of a problem as sites that charge like 50% less than offline for something but they expect you to buy overpriced accessories for it or else they take forever to ship it. I heard about this when I went shopping for a digital camera and I was tempted to buy online for the cheaper price but opted not to.

What?

[RobFrontier]

Did someone put a gun to their head and force them to buy the product at that price? It's the etailers job to make money, if people aren't smart enough to comparison shop, then more power to them. How lazy are you when you won't take an extra 5 minutes to click to a rival website and check out their price?

Yes, it is illegal...

[gillbates]

Changing prices is generally lawful unless doing so discriminates against a consumer's race or gender or violates antitrust or price-fixing laws. [emphasis added]

IANAL, but IRC, it is in fact illegal to charge different customers different prices for the exact same product - and this irrespective of any differences in race or gender, etc... The only time when a company may legally charge different prices to different customers is when there exists a substantial difference in the market - i.e. shipping costs, etc.

Now, granted, that doesn't change the fact that a company can get around this by simply changing the packaging to produce a different product targeted at a different market. Nor does it prevent a company from dynamically adjusting prices to market conditions. But charging different customers differing prices is in general illegal. The fact that it's hard to prove, and many businesses get away with it, doesn't make it legal.

Re:Yes, it is illegal...

[zmollusc]

............but they could argue that it was not simultaneously offering diferent prices.

Re:Yes, it is illegal...

[CommieOverlord]

Have you ever flown on an airplane? Chances are that no two people on the plane paid the same amount for their tickets.

Under your silly rules haggling over prices would be illegal? Ever bough a car? Have you truly never haggled?

Re:Yes, it is illegal...

[fishbowl]

"it is in fact illegal to charge different customers different prices for the exact same product"

How is it "in fact illegal" if there's no such law against it?

The problem is when you can't tell...

[Animaether]

Sure, it's one thing when Amazon suddenly charges you $500 for a book when you could've sworn it would only cost $25...

But what if they charge you $24.99 instead of $22.99 based on whatever criteria ?
Wouldn't you like to know that you could get it cheaper if you fulfilled that criteria ?
It's just like shopping cards/etc... they get offered to you, and if you take it, you can get things 'cheaper' (whether you actually do is another discussion).
However, in these cases, Amazon doesn't offer you any such thing at all. They keep it as quiet as possible. So short of going to a different machine and maybe logging in as an entirely different user, you won't know.

That's what the problem is :)

Yes, I know, people should 'shop around' and find the best deal anyway. But that's between different stores. This is a price difference at the exact same store.

Re:Time for that Near-Fatal Heart Attack Folks...N

[JenovaSynthesis]

No, it does make sense. If you place an order with BestBuy.Com, the system takes care of everything. The only human(s) they have to pay is whoever goes and grabs the item from the store/storage and brings it up and verifies purchase. At most the whole process would take about 5-10 minutes.

A shopper at the store has to deal with sales floor staff, etc. For example it is much cheaper for them in terms of operating costs to sell a computer to an online shopper than it is to sell that identicle machine to an in-store shopper. The in-store shopper might eat up 20-30 minutes of the sales person's time, then they have to go wait in line at the cashier lanes, etc.

Re:Time for that Near-Fatal Heart Attack Folks...N

[fishbowl]

The only thing I'm questioning is the statement by a Best Buy employee that bestbuy.com and the Best Buy store are so disconnected as to actually be *competitors*.

Obviously, a commissioned salesperson might see it that way, but that's as far as it goes.

Re: car dealers, etc.

[toddestan]

That's kind of odd. I have found dealerships are willing to let someone test drive cars like that, even if they don't think that they will buy (so long as the dealership isn't too busy). The idea being that even if you don't buy, they hope you're still going tell all your friends about how sweet the Trans-Am drives, and maybe they will come over and look at one.

It's even at the point when I go to the dealer to get my car serviced, and I'm wandering around the sales room trying to kill a half hour, they are asking me if I want to take some new model for a spin!

Re:The grand era of the ultimate market segmentati

[Desert Raven]

You know, it amazes me that anyone thinks this is something new.

Some of the oldest companies I've worked for have HUGE "special pricing" books, that list special prices on specific items for certain customers. Heck, sometimes the pricing was even specific to certain projects.

The only thing new about this is that it can be automated, which is bringing it to the consumer level. Which means that once you reach a certain level of business, you may get special pricing without having to *ask* for it. In the "old days", if you wanted special pricing, you generally had to negotiate for it.

Travel sites and low prices

[Animats]

Some sites claim to offer the lowest prices. That's enforceable under false advertising rules. Orbitz has a low price guarantee, althoug the terms are amusing:

Orbitz Low Fare Promise

If you book an airline ticket on Orbitz.com and then find a lower airfare for the same flights, dates, airline and travelers on another Web site, you may be entitled to a $50 coupon per ticket toward your next Orbitz purchase.

• The fare must be at least $5 less per ticket than the airfare purchased on Orbitz.com.
• The lower total airfare may not include Web site service, booking, processing, shipping, paper-ticket or other fees.
• You must provide the complete Web address (URL) where you found the lower airfare.
• You must file a claim by Midnight Central Time of the same day you booked your Orbitz flights.
• To submit a claim, go to your itinerary under the "My Trips" tab and click the "Low Fare Promise" link. It will display a claim form with all the required fields.

Remember to make a printout or take a screen shot of the page with the lower airfare, either the itinerary confirmation or the summary page just prior to purchase, in case a customer service representative has questions. Expect a response to your claim within 10 to 15 business days.

Please read the Low Fare Promise terms and conditions below for full details.

Orbitz Low Fare Promise Terms and Conditions

1. The Orbitz Low Fare Promise is available to any customer who makes a qualifying airfare purchase through the Orbitz.com website. Qualifying purchase must occur at Orbitz.com on/after October 23, 2004.
2. The Orbitz Low Fare Promise applies only to airline tickets purchased on Orbitz.com for travel within the domestic 50 United States, and only for tickets purchased using a valid credit card with a United States billing address.
3. The Orbitz Low Fare Promise applies only to the total airfare and does not apply to differences based on service, booking, processing, shipping, paper-ticket and other fees not collected on the airline ticket.
4. If you find an airfare for the same flights and dates of travel, on the same airline, with the same flight numbers, for the same passengers, itinerary, cabin, and subject to the same fare restrictions on any other full service travel Web site or airline site that is at least $5 lower than the airfare you purchased on the same day on Orbitz.com, Orbitz will give you a coupon in the amount of $50 for every ticket in your Orbitz reservation, redeemable on your next Orbitz.com purchase.
5. To submit a claim, fill out and submit the claim form located next to your itinerary under the My Trips tab on Orbitz.com. Once you select the qualifying trip, click the "Low Fare Promise" link and the claim form will automatically include the required details of your trip. You will need to provide the following additional information:
   • Complete Web address (URL) reflecting the lower airfare you found online
   • Total airfare quoted on the other Web site for all tickets including taxes (but excluding web site service, booking, processing, shipping or other fees)
6. Your claim must be submitted by midnight Central Time of the same day you purchased your ticket on Orbitz.com. Claims may be submitted only via the online claim form at Orbitz.com and not through any other e-mail address or any Orbitz phone number.
7. The Orbitz Low Fare Promise applies to lower airfares of $5 or greater found on another full-service travel Web site or airline Web site. The confirmed airfare you purchased on Orbitz.com will be compared to the airfare on the other site at the last point immediately prior to purchase. Fares must be compared with like fare restrictions, so for example, if an unrestricted airfare is purchased on

Hotwire

[borgasm]

Hotwire does this....

I was searching for an airline ticket, and the search came back at $445....

so I searched some more, and the price went up to $451

I went to a different computer, did the same search...$443

Bullshit

Happens on eBay too

[HangingChad]

The same sellers will offer identical products at vastly different prices, you really have to shop around. Not all of them do that, but I've caught it a few times because I shop for very distinctive products, like underwater video cameras (no, not for shooting underwater p0rn) and ROV's.

Another tactic

[Frodo420024]

Hi I came across another way of ripping people off. Shopping for a Digital Rebel XT, I came across USA Photo Nation. They have it $300 cheaper than anyone else, but won't ship international.

I was trying to arrange for friends in the US to get it and forward it to me, when my brother found that on a scale from 0 to 10, they score 0.92 in credibility. That's right, less than 1! The stories are all the same - they let you order a super-cheap item, but won't actually ship it unless you buy a truckload of vastly overprice extras.

It's legal, probably even profitable, but stinks. I assume more scams like that can be found out there - careful about those super-low prices!

Have fun!

Re:Another tactic

[fishbowl]

Be aware of what some of these mail order shops actually look like:

http://www.panix.com/~donwiss/pictures/BrooklynSto res/

Re:Another tactic

[fishbowl]

You nearly sent a thousand bucks to these guys:

http://donwiss.com/pictures/BrooklynStores/h0101.h tm

They would have sent you the camera, (maybe), stripped of the accessories that come with it.

BTW, I found the EOS 20D to be well worth the higher price, after trying it and a RebelXT for a while. For one thing, it's much, MUCH more comfortable to hold. For another, there's a significant value in the information that's right on top of the camera, and in a way that's hard to describe, the ergonomics don't really work on the Rebel nearly as well as on the 20D.

That said, if you save $500 getting the RebelXT (still a great camera), spend it on a lens. The main reason to buy a Canon EOS is the great lenses available for it. If you're just going to get mediocre lenses, it's really not such a great value. You might actually be disappointed with your results. The EF/L lenses are what make this DSLR system so great.

Know what you're getting into.

Re:Another tactic

[Frodo420024]

You nearly sent a thousand bucks to these guys: http://donwiss.com/pictures/BrooklynStores/h0101.h tm *Shudder* > That said, if you save $500 getting the RebelXT > (still a great camera), spend it on a lens. I just did :) Got myself a Sigma 55-200 mm, am awaiting photo-compatible weather :) Actually, the ergonomics of the RebelXT works out for me (my hands are average sized), and I just couldn't justify another $500 for the 20D. Good luck! -Henrik

And Wal*Mart gives lowest price, so what?

[gosand]

If you don't like the price that something's being offered at, then you just don't have to buy it. There's no legal obligation that car dealers have to give everybody the same lowest price that they ever sold a car for. I'm not sure about the idea mentioned in the article that regular customers will get lower prices though - surely it should work the other way around. You get the customers landed with cheap prices and as they keep coming back you gradually tap them up until their visits start to drop off and then you start to lower them back down.

And sometimes, paying a higher price can be better. The big guys can usually lower their prices more than the little guys. There *IS* an overhead that merchants and suppliers incur, even in online stores. They may not be trying to screw you, they might just be trying to make a decent profit. Just because Wal*Mart can offer you the lowest price, does that mean you should shop there? I don't. I don't like the way they do business, so I avoid them. Lowest price does not always mean best for the customer.

I work in the online retail business, and e-tailers know that there are several factors in getting and retaining customers. One of them is price. Pricing for internet retailers is very very complex, and prices may change daily because of a variety of factors. Each retailer may have their own methods, so to say "the industry" does something is somewhat misleading.

yes, but

[geekoid]

what if the price went up?
letes say you get to the register and the person says "We know you will only drink brand X soda, so we are raising the price a buck"
what if they just did it without telling you?

Shop at DELL - Use IE on a PC for better pricing

[tburt11]

I couldn't believe my eyes.....
Dimension 4700 - custom configured

April 15, 2005
Internet explorer - $1,127
Firefox - $1,576
Safari (Mac) - $1,675

Same model, same custom config, same everything.

Higher price.

WTF?

Re:Really? I don't believe it.

[nEoN nOoDlE]

it's not based on computer, I don't think. The stores I visit, when you're a return shopper, you usually have a username and password. They could change prices depending on whether you're logged in or not. It might also be different based on location... multiple computers in your own home would be coming from the same location, so prices wouldn't change.

I believe it, though I don't have the proof to back it up.

Re:not for shooting underwater p0rn

[zmollusc]

Oh! So what sort of p0rn needs a waterproof camera, then? Ewwwww!

OTOH, time is always money

[kencurry]

I've known that sites dynamically change prices for some time; I've experienced it myself with amazon.com. Still, how much time does it takes to weasle out those last couple of bucks? 10 minutes of hassle?

And what if the best-priced site is one you've never heard of? How reliable are they? what is their return policy? shipping? charge state tax? You've got to research that also.

Sticking with one site, even if you know if may not be the best deal, may still be a good choice.

I'm sure I'm one of those guys that marketing droids love, but I don't care. My time is more important to me than saving a few bucks here or there.

How price discrimination helps my grandma

[rolofft]

The classic example economics teachers give on price discrimination is discounts for seniors and youths. Gertrude on her fixed annuity and Billy with his paper route can't afford as much - so restauranteurs (for example) offer adjusted prices to fit the customer.

Re:Shop at DELL - Use IE on a PC for better pricin

[JadeNB]

For the sake of reproducing it, what was the configuration?

notes form a bottom feeder

[gumbi west]

I always use those sites to find the best price. Here is how you do it.

1. go to price grabber site
2. find cheapest and those close by
3. go to that company's site
4. buy product for about 10% less

Sometimes the last one doesn't happen, but it often does.

Markets, liqudity and "fair" prices

[sjbe]

Here's my problem with it: it's bad for consumers.

I disagree and so do most economists. True, not everyone gets the same price but that's ok. Consumers don't have a right to buy things at zero markup just because it would benefit them; that would put every company out of business. Nor do consumers have to agree to buy things at a ridiculous markup. A trade is a negotiated agreement. It's up to you and you alone to decide whether something is worth the asking price. You might regret it later but that's your fault for not doing a better job negotiating. Put simply, if the price is agreeable to you by definition that cannot be unfair.

The reason markets work well for consumers is because the market sets the price.

A "market" isn't a concious entity and doesn't make decisions. Markets don't "set" prices. A market is a collective group of individual trades, of which each involved party is ostensibly attempting to maximize his own benefit. If pricing information is transparent you may know what others were willing to pay, but sometimes this information isn't available. For example, how much is a piece of art worth? Hard to say since it is very subjective and what others paid isn't usually known. But ultimately what it is worth is whatever the buyer and seller are willing to agree to.

Even though there isn't time for an individual to research every purchase, they don't have to, becasue so long as a certain percentage of consumers do notice, the price will be competitive.

I think you are trying to explain market liquidity and you may be confusing this idea with the popular but useless notion of a "fair" price. Liquidity has little to do with how much time people are willing to put into trades. Markets are liquid because there are large numbers of buyers and sellers interacting.

As for a "fair" price, you have to think about what fair means. What is fair? If you ask an economist, any time a buyer and seller agree to a price, that is what that good/service is worth at that moment. It is by definition a fair price because both parties voluntarily agreed to it. This has nothing to do with markets per se because markets are just a collection of individual trades.

Price discrimination places the burden of researching every decision on individual consumers.

Why do you think it is someone else's responsibility to decide what something is worth to you? I don't know or care what you think something is worth, and I certainly don't want to be bothered trying to find out. If you are happy with the price someone is asking for a good or service you will pay it. If you aren't you won't. Like it or not, this IS a burden the consumer is supposed to bear. The only one who can decide whether a price is fair is you!

-----------
Please note that in all the above I'm assuming that there are no coersive forces or fraud at work nor a monopoly or monopsony is involved. Some regulation is necessary to keep markets transparent and liquid and in those cases we need third parties (usually government) to keep everything on the up and up.

Travel agents don't play those kinds of games

[erice]

I think they program the software so that the more hits they get on a product page served to your [preset] "cookie", the more they edge the price up on you, figuring, I guess, that you're really interested in the product, and that maybe they can "scare" you into purchasing it [or maybe somehow bleed that extra $10 of profit out of you on account of your insatiable desire for the product]. And no, I don't think this is primarily a supply and demand thing - I think these price change engines are primarily driven by some [previously arcane] theory of marketing psychology. The airline/hotel reservation systems [Expedia, Travelocity, Orbitz] are particularly guilty of this [and, again, I do NOT believe that it is primarily attributable to a finite supply of airline tickets or a finite supply hotel rooms].

The travel agencies are not playing games with you. The "problem" stems from the pool of available tickets beeing distributed among differently priced buckets. Temporary holds take tickets out of these buckets. This may mean that there are no more tickets available in cheap buckets so the price appears to rise, somtimes multiple times throughout the day.

The key information is that at the end of the day, holds expire and the remaining tickets are reallocated. You've never seen the price go down? That's becuase you haven't been checking at the right time. Try between midnight and 7:00am. Often those cheap tickets are available again.

Dubious statistics

[Xhris]

The margin of sampling error was reported to be plus or minus 2.51 percentage points.

Quoting the error to this precision shows the investigators do not have the slightest clue about statistics. 0.01% of the sample size is a 0.15 fraction of a person...

How about a list?

[jesterzog]

I've experienced price changes within the span of five minutes, or less. I'll be surfing around to sites, comparing prices, and I'll return to a site I've just visited, and they'll increase the price on me [I've never seen a price decrease].

I would like to see a list of businesses who do this, so I can either avoid them or be extra-scrupulous when buying from them. I'm particularly interested in those who do it without being up-front and clear to the customer about what they're doing.

It can't possibly be good publicity for a company for customers to be told that the price might be changed between the time that it's advertised and the time they purchase, certainly without it being clearly indicated next to the price. In many countries this would be considered a fradulent practice.

Re:Questions made to make people look ignorant.

[fishbowl]

>Someone will do it if shown proof.

"Someone" will do it if handed a court order. That proof might be sufficient to persuade a judge to sign that order. But that's about as far as it goes, strictly in terms of obligations.

I honestly don't think so.

[mosel-saar-ruwer]

The "problem" stems from the pool of available tickets beeing distributed among differently priced buckets.

Look, I know there are these things called "supply and demand", and I don't doubt that they have a rather profound influence on this thing called "price".

However, I honestly don't think that what's happening. I've seen it so often that I'm convinced there is a family of semi-smart software packages that are tracking your preset "cookie" [and/or your IP address], and/or keeping track of the total "hits" [or queries] for a particular product, and then playing games with the prices that are being served to the queriers [e.g. if the software senses an increase in queries about a product, then it's programmed to raise the price as a response to the increase in queries].

Now an ostensibly neutral observer to this conversation might proffer the thesis that I'm paranoid, but obviously I would demur.

Alternatively, one could try to associate "an increase in demand" with "an increase in queries", yet I would counter that "an increase in demand" is more or less identical with "an increase in SALES".

But I think both of these explanations are being too charitable to the people who designed the software - my belief is that thinking behind the algorithm goes something like "Hey, we've got some poor sucker out there who's showing some interest in our product - let's see how much we can jack up the price before he'll lunge for the bait."

Anyway, the moral of the story is that if you want the rock-bottom lowest price on a web purchase, then don't close a browser window that contains a price quote - and open a new browser window to check prices with the store's competitors.

Re: car dealers, etc.

[Feztaa]

Totally opposite my experience in car dealerships.

One day when I was 18, I went with a friend of mine to some random car dealership where we lived. We were first year university students living in residence on our parent's money, we were flat broke and wearing rags. We found the most expensive car (a $90,000 corvette), and asked the sales guy if we could sit in it. He was more than happy to oblige, so we got in and it was a very nice car.

No test drive of course (we didn't even ask), and we left without buying anything. But the salesman was very friendly and accomodating the whole time. Bored I guess ;)

And, on top of that

[physicsphairy]

Price differentiation is good for us little guys, and for the economy.

Example: Coupons. Coupons allow stores to set two prices, a high price and a discount price. People with small budgets use coupons and save money; people with large budgets are generally not concerned with cutting out coupons and pay the higher price. More transactions occur--there is less deadweight loss in the economy; the store makes more money; and those with smaller incomes can buy more than they would be able to otherwise. If there was not a coupon, the profit-maximizing price would be higher than the coupon price, but lower than the high price. The store makes less money, the poorest purchasers miss out on the item because the marginal cost of purchasing it is now too high for them, and those slightly better off than the poorest get a worse deal.

As a general rule, everybody is best off when sales are maximized in a non-coercive fashion. This applies to pretty much all forms of price discrimination in competitive markets.

Re:And, on top of that

[QuaZar666]

In the perfect world using coupons to save money would be great, but that is not always the case. Many times coupons don't save money when you compare the product to a product of the same or better quality that costs less or when compared to making the product yourself. Take for example Pasta sauce. One can buy one brand for $4 and save 50 cents with a coupon, can by another one for $3 of equal quality or spend $2 if they spend the time to make the sauce from tomatos, tomato paste, herbs, etc,etc. Which is why I almost never use coupons. While it is true you can sometimes save money with coupons, you can also spend more by buying brands that are more expensive.

Re:Time for that Near-Fatal Heart Attack Folks...N

[rynthetyn]

The department store that I worked at in college will sometimes offer a different price on the website for the same item, but if the customer comes in with the printout from the website looking to buy it in store, we would adjust the price to what the website was charging. However, if you're wanting something shipped, it's often cheaper to come into the store and have one of the sales people put in the order to ship from the warehouse, because instore warehouse orders are a flat shipping fee (free over a certain amount), while the website is a sliding scale based price of the item--in both cases, the item is shipping from the exact same place.

Re:Shop at DELL - Use IE on a PC for better pricin

[tburt11]

Really just a standard corporate PC.
XP Pro, half gig ram, 18 inch LCD and Office Pro.
I have the full 9 page hardcopies of the configs.
Item for item, they are identical.
Why would I lie?