Re/code:
The study of Amazon’s pricing uncovered some interesting tactics. First, Amazon doesn’t have the lowest prices across the board, which may not surprise industry insiders but might surprise Amazon shoppers.
Instead, according to Boomerang’s analysis, Amazon identifies the most popular products on its site and consistently prices them under the competition.
A good reminder to not assume Amazon has the best prices and to always shop around.
When combined with Prime and free two day shipping, sometimes it doesn’t matter that much the Amazon isn’t the cheapest.
Huh.
I’ve never assumed Amazon always had the best price – just the most convenient option for most things.
That said, their prices have always been competitive against other serious retailers every time I’ve checked.
This tactic has been used by all major retailers. Supermarkets, big box stores, etc., all try to make the items we are most price sensitive about appear to be the best price, while other items are the real profit centre.
It’s called loss leader pricing.
Like what they used to do with their e-books 🙂