Small and large retailers are upset lately due to the fact that folks are coming into their stores not to buy anything but rather to look at the products, get a price, and then go home online and buy it from Amazon. Target stores issued a memorandum to suppliers that they wanted unique products which were only sold to Target, and not available anywhere else to prevent this tactic.
There was an interesting article recently in Terra Daily titled; “Amazon slammed for price reporting deal,” by Staff Writers – Washington (AFP) Dec 10, 2011. The article stated;
“Amazon accused of being “anti-competitive” for a promotion encouraging consumers to enter stores and leave empty-handed, after reporting back the prices they find there. “Price Check” is where customers find & share in-store prices and get a 5% discount up to $5 from Amazon purchases, but now the US Senate is investigating and the Retail Industry Leaders Association (RILA) said the promotion is a “central to this tactic is Amazon’s continued practice of using a pre-Internet loophole to avoid state sales tax collection, and wants lawmakers to rein in what it called the company’s “exploitative” practices.”
Okay so, let’s talk about this shall we? First, it isn’t anti-competitive, “it is very competitive,” next, we see that Barnes and Noble has just announced that they will not sell any books, which are also for sale on Amazon as a way to fight this problem. Now, from my point of view, that is very anti-competitive, and it could be seen as an anti-trust issue because Barnes and Noble is telling its publishers and their authors that they plan to control the distribution supply chain, something that the FTC went after Microsoft for, remember and Jon Leibowitz is now running the FTC.
There was an interesting article on this in the New York Times on January 31, 2012 titled; “Barnes & Noble Won’t Sell Books From Amazon Publishing,” by Julie Bosman. Now then, personally, I believe it is Barnes and Noble’s right to do this, although I think it is a really bad business move, as it says to consumers; “we can’t compete with Amazon, therefore, we won’t” and it gives Jeff Bezos the third round, and I bet the fourth round will be a knock-out either in the courtroom or at the hand of the consumer and continued quarterly losses from the big box bookseller.
Indeed, for a small business retailer, there is no way they can compete with the big box stores, or the online venue, and Amazon is taking this to a higher level by leveraging their market position and competing on price, which is what the consumer wants after all. Please consider all this and think on it.