Online Shoppers Naive About Online Prices 513
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.'"
Does this happen much? (Score:2)
Re:Does this happen much? (Score:3, Interesting)
Re:Does this happen much? (Score:2)
"just because you browse a site differently"="just because you lie to
Re:Does this happen much? (Score:2)
Re:Does this happen much? (Score:3, Insightful)
Re: (Score:2)
Price discrimination (Score:3, Insightful)
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. (with appropriate exceptions for
Re:Price discrimination (Score:2)
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 fi
Not just online (Score:5, Insightful)
Re:Price discrimination (Score:2)
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 (Score:5, Insightful)
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 (Score:4, Insightful)
If my friend can't understand that, then maybe I need to be more careful choosing friends.
Illegality and the Robinson-Patman Act (Score:4, Interesting)
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 (Score:2, Informative)
Re:Price discrimination (Score:2)
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:Negotiating prices on EVERYTHING (Score:3, Insightful)
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 y
Re:Does this happen much? (Score:2, Informative)
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
Re:Does this happen much? (Score:2)
Re:Does this happen much? (Score:2)
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: (Score:2)
Re: (Score:2)
Re:Does this happen much? (Score:2)
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
Happens within the span of about five minutes. (Score:4, Interesting)
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.
I just brought this up on /. (Score:2)
Your audience is different. I'd say instore shoppers are naive about instore products and prices. Because of the Internet you
Old School Business Practices (Score:2)
(Hides price tag)
I love the interweb (Score:2)
So people who buy with no thought to price (Score:2)
Let that be a lesson to all the brand junkies.
Be informed (Score:2)
Rage3d.com/deals
Slickdeals.net
Pricewatch.co m
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
Re:Be informed (Score:2)
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 (Score:2)
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 (Score:2)
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 (Score:2)
Oh but then I think online retailers would scream bloody murder.
Re:this practice (Score:2)
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. (Score:3, Interesting)
Somebody please provide a sample site that does this.
Don't everyone volunteer at once (Score:2)
Re:Really? I don't believe it. (Score:2)
Most online shoppers simply niave.... (Score:2)
Re:Most online shoppers simply niave.... (Score:3, Funny)
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.... (Score:2)
Re:Most online shoppers simply niave.... (Score:2)
My favorite example of this is... (Score:3, Interesting)
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 s
The Euphemism is: Price Customization (Score:2)
"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 o
Advice from InternetWeek (Score:2)
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
Bottom feeders (Score:5, Insightful)
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 (Score:2)
He left with a $40,000 pickup truck, having bought it from neither of those two.
Re:Bottom feeders (Score:2, Interesting)
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 p
Re:Bottom feeders (Score:2, Insightful)
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
Re:Bottom feeders (Score:2, Interesting)
Re:Bottom feeders (Score:2)
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 buildi
Re:Bottom feeders (Score:2)
Re:Bottom feeders (Score:2)
0 Balance Customer=Freeloader (Score:2)
"Freeloaders" Get Higher Fees [eagletribune.com]
GE Punishes "Freeloaders" [cardweb.com]
BJs Drops Customers [cardweb.com]
Re:Bottom feeders (Score:2)
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.
Yo
Re:Bottom feeders (Score:2)
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 some
Re:Bottom feeders (Score:2)
Reminds me of some wise words I learned in grade school -- never
Re: (Score:2)
Re:Bottom feeders (Score:3, Insightful)
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
Re:Luxury vs Others (Score:2)
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.
Yep (Score:4, Informative)
You can use this site to compare prices on books, cds, dvds
http://www.bestbookbuys.com/ [bestbookbuys.com]
You can also blow your cookies and see what the prices are before you sign into your account.
I really fail to see what the problem is (Score:4, Insightful)
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 (Score:2)
Re:I really fail to see what the problem is (Score:2)
Re:I really fail to see what the problem is (Score:2)
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 s
And Wal*Mart gives lowest price, so what? (Score:3, Informative)
What on earth is wrong with 'my attitude'? (Score:2)
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 s
... and they like it that way (Score:2)
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... (Score:2)
Age-old line (Score:2)
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?
Schock and out rage!!! (Score:2)
not so clever (Score:2)
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.
Ever go to a frickin' grocery store? (Score:3, Informative)
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? (Score:2)
Re:Ever go to a frickin' grocery store? (Score:3, Insightful)
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
Re:Ever go to a frickin' grocery store? (Score:2)
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
Re:Ever go to a frickin' grocery store? (Score:2)
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.
what? (Score:3, Funny)
Reserve price (Score:3, Informative)
That's not news (Score:2)
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? (Score:2, Funny)
plus or minus 2.51 percentage points
That's odd -- my screen reads "5.21 percentage points."
The grand era of the ultimate market segmentation (Score:2)
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 continu
Victoria Secrets did this (Score:3, Interesting)
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 [courttv.com] about this issue and another link [vanderbilt.edu] from a 1998 Forbes article on the issue of price discrimination.
For a more in-depth look at price discrimination, see this link [vjolt.net] which is a muli-page essay from the Virginia Journal of Law and Technology from 2001.
True offline as well (Score:2)
People are idiots (Score:3, Interesting)
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 (Score:2)
the opposite extreme (Score:2)
Discounts? (Score:2)
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? (Score:2)
Prices I understand, but availability?? (Score:2)
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/ [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 wit
Sad State of Affairs (Score:2)
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
Why fixed price retail is bad (Score:2)
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
If you read the study... (Score:2)
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 su
Ever buy airline tickets online? (Score:3, Interesting)
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.
&^%$#@! marketing droids.. (Score:4, Insightful)
No, lawyers and marketing dicks are the "bottom feeders." the rest of us are just trying to avoid getting screwed by both parties.
Re:and it goes on (Score:2, Interesting)
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 (Score:5, Funny)
Re:and it goes on (Score:2)
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 (Score:2)
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
Re:and it goes on (Score:5, Funny)
Interesting coming from someone with a free iPod ponzi scheme ad in their sig....
Re:outrage! (Score:3, Insightful)
There's a reason that this is an old practice: it works. Let
Re:It's all good--if it's profitable (Score:2)