Amazon Price Parity - Anticompetitive Behavior

Just got this email

[nonstop]

Hi All,


I just got an email from Amazon saying that the prices on my website need to be the same as on Amazon. I can't understand this as the commission on Amazon is 15-20% for the products we sell. Is there anyway around this? we have been selling on Amazon for over 4 years now without any problems and we have 1000s of products there's no way we can set our website prices to the same as on Amazon. Surely this is Amazon trying to control the market?

[edited by: jatar_k at 1:06 pm (utc) on Nov 9, 2011]
[edit reason] no email pls [/edit]

[piatkow]

I just got this email from Amazon saying that the prices on my website need to be the same as on Amazon.

Other way around surely. I can understand that they don't want you using Amazon to find prospects then offering discounted follow up sales through another channel.

[oliondor]

Just develop your own shop instead of working for them !

[edited by: eelixduppy at 10:57 am (utc) on Nov 9, 2011]

[taylors]

We use Amazon and ebay to get the customer's initially and then try our best to get them to use our online stores since we don't have to pay ourselves the 15% commission fees that they charge us. I got the same exact letter from Amazon. We do lots of orders on Amazon and eBay but find it very difficult to convert these customers to our online store even with the prices being less and with discount coupon codes.

[jwolthuis]

Surely this is Amazon trying to control the market?

Yes, but you opted-in to sell there (for $40/month), by their rules. Save the $40 fee, and use that money toward Amazon Ads directing buyers to your site.

Otherwise, raise your website prices to match the Amazon price, and offer free shipping on your website.

[topr8]

>>and offer free shipping on your website.

that would still be breaking the rules!

total amount payable by a customer for that product, including discounts, rebates, promotions and shipping.

[jwolthuis]

>> that would still be breaking the rules!

Oh wow, you're right.

I'm not sure how you're expected to sync to their standard shipping rates. Maybe add lead weights to those 3 oz packages, to triple the postage?

If you offer a discount or rebate on your site (say, free shipping for orders over $50, or a two-for-one), how do you go about offering that same discount or rebate on Amazon? Isn't that a little tough to do?

[CernyM]

This has been a part of their seller agreement for as long as we've been selling there - which is since 2004 or 2005.

It just took them a while to notice on your account.

[Planet13]

Out of curiosity...

Have people been doing well selling through amazon?

We tried it, had a handful of sales, but again, nothing that converted to customers coming to our site.

The other thing is, if you are on Amazon, you are in competition with dozens of other stores explicitly on price, no?

But lots of people sell on Amazon, so how are they making it profitable?

[topr8]

my only experience of this was a friend of mine who i advised to try selling on amazon ... who did really well as he had a unique product

but within a year or so competition had kicked in and sales went downhill fast.

[jwolthuis]

To sell on Amazon, you either need a niche product, sell it for free (profiting on shipping), or play the how-low-can-you-go game.

[CernyM]

Out of curiosity...

Have people been doing well selling through amazon?

A substantial amount of our ecommerce revenues come through Amazon.

We tried it, had a handful of sales, but again, nothing that converted to customers coming to our site.

The other thing is, if you are on Amazon, you are in competition with dozens of other stores explicitly on price, no?

It depends on what you sell. We manufacture our own products and are the only seller for the brand on Amazon.

But lots of people sell on Amazon, so how are they making it profitable?

Most of the successful people who don't sell their own brand spend a lot of time hunting down profitable niches to exploit. As the profits dry up, they find something else to sell.