Retailer Perspective
Retailer’s Perspective – Amazon, Ethics and the Changing Retail Landscape
- 19th December
- Michael Fox 19
Michael Fox explores the conundrum caused by Amazon’s recent price check promotion, which not only raises ethical questions but also signals a shift in the retail landscape.
Amazon recently launched a promotion where customers were encouraged to visit bricks and mortar bookstores, to use its price check app to scan the bar code on books, then enter the price the book store was charging for the book. For doing this the customer was rewarded with a 5% credit on Amazon.com purchases. The promotion was designed to point out to consumers that books are cheaper to buy on Amazon, and provide the company with valuable price comparison data.
There has been some interesting discussion online about the ethics of this practice. Bricks and mortar bookstores provide a great service, they allow people to browse books in a comfortable physical environment, their staff are knowledgable and can help customers find new books in more natural ways than sites like Amazon can, and they often run in-store activities such as having authors present and discuss their new books. But they can’t compete on price and Amazon are doing everything they can to point this out to consumers, by actively encouraging consumers to browse in physical bookstores then order online from Amazon.
There’s no doubt this is pushing the boundaries of what’s ethical, but the reality is that this is one of the directions retail is heading. For commoditised products like books, it’s challenging for retailers to compete on anything but price. Most of the value from the purchase is tied up in the book itself, with only a small amount of additional value provided by the shopping environment, staff and customer service.
Retailers need to understand this shift. It is only going to become easier for consumers to do price comparisons and ordering via their mobile phones. If you’re selling a commoditised product and aren’t aiming for a lowest cost strategy it’s important to start thinking through how you can differentiate your offer to avoid suffering from this trend. An alternative is to look to switch to selling products under your own brand, rather than selling commoditised products. Harder to do for a bookstore, but potentially simpler for other retailers. At Shoes of Prey and Sneaking Duck we avoid the commoditised product issue by selling products that aren’t easily replicated and offering them under our own brand.
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Hang on since when has there been ‘ethics’ in retail. Let’s think about what is happening here and not get on a ‘high horse’ too soon. I recently bought a new camera lens worth about $800.00. I shopped around and found the lens both online and offline. The best deal that I found was in a bricks and mortar store. They also had a policy that if you could show them a cheaper price from a competitor (online or offline) they would beat it.
I don’t think that ethics ever existed in retail when it comes to competition and I don’t think it ever will. Retail is a cut throat world and we can just as easily complain about $1 bottles of milk from Coles and Woolies as we can Amazon offering to beat the best prices of its competitors.
The closest to ethical behaviour was probably the old corner store but guess what they even used to hide the bruises on the apples.
Get serious.
Wanna price check? Check out how cheaper you can buy from local vendors through taap.it #occupyamazon.
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