E-commerce, What does the price mean?

The NYTimes  wrote an expose on e-commerce sites exploiting customers looking for a “deal”.

What the sites do?

  • Websites (e.g. Overstock, etc.) show expensive prices to portray expensive merchandise
  • Websites show discounts to convince customers that they are getting a deal.
  • Some websites (e.g. Amazon, eBay) have timed-deal to create urgency.

Are there problems with these tactics? 

There is no problem if the prices the e-commerce sites are showing have some honest basis to them. Instead these listing prices are intentionally boosted beyond the suggested manufacture’s price.

Consider the following:

“If you’re selling $15 pens for $7.50, but just about everybody else is also selling the pens for $7.50, then saying the list price is $15 is a lie,” said David C. Vladeck, the former director of the F.T.C.’s Bureau of Consumer Protection. “And if you’re doing this frequently, it’s a serious problem.”

You can’t say you’re selling pens 50% off for $7.50 so that customers think the pens are more valuable. That is deceitful.

We pray that apps like Uber, Lyft etc. will also behave and not increase ‘surge’ pricing.

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