Blog Post

Stop Freaking Out About Amazon's Price Check App

This Saturday, Amazon (NSDQ: AMZN) is running a promotion that is making a lot of people very mad: Use the company’s Price Check mobile app to compare prices in bricks-and-mortar stores to those on Amazon, and you’ll get a 5 percent discount–up to $5–off Amazon’s price on “up to three qualifying products in eligible categories, including electronics, toys, music, sporting goods and DVDs.” Judging by the reaction to this, you would think that Amazon representatives are walking into independent bookstores and ripping books out of shoppers’ hands.

Amazon does a lot of things I don’t like (like this), but the Price Check app promotion isn’t really one of them. Here’s why.

Amazon’s Price Check App Isn’t New, And Neither Are Price-Check Apps In General. Amazon’s Price Check app has been available for iOS since November 2010. Another barcode-scanning price-check app, Red Laser, has been available since May 2009, and was bought by eBay (NSDQ: EBAY) last year. It has been downloaded over 12 million times.

Books Aren’t Included In This Promotion, But Even If They Were, It Wouldn’t Change Anything. Much of the anger about this promotion is coming from some members of the publishing and bookselling community who mistakenly believe that books are included in this promotion. “Amazon offers people $15 to walk out of bookstores,” writes Dennis Johnson at Moby Lives. Publishers Weekly writes, “While books aren’t specifically included, a number of sidelines typically found in bookstores are” and quotes one bookseller who calls the Price Check app “the virtual equivalent of John D. Rockefeller’s Standard Oil gas station strategy.”

These sentiments have intensified this week after the New York Times (NYSE: NYT) called attention to new research from the Codex Group that shows an increasing number of book shoppers using bricks-and-mortar bookstores as “showrooms” to discover new titles, then buying online. That is certainly unfortunate for the bricks-and-mortar bookstores. But the practice has nothing to do with this particular Amazon promotion, which doesn’t include books. And even if it did include books, everybody already knows that books are cheaper on Amazon. Nobody goes into an independent bookstore expecting to find really cheap books there. People visit independent bookstores for other reasons, and those who do place a high priority on supporting their local indie weren’t going to march in and start scanning book barcodes anyway.

Only Big-Box Shoppers Or Jerks Are Going To Take Advantage Of This Promotion. Most of the Amazon Price Check app usage that goes on this Saturday is going to take place in big-box stores like Best Buy and Wal-Mart (NYSE: WMT). Sales tax issues aside (and yes, Amazon’s avoidance of paying sales tax in most states is an issue, but it’s no more of an issue in this particular instance than it is at any other time), can you really say in your heart that you are upset that someone might buy their Blu-Ray player on Amazon instead of at Best Buy? (Unless you are a Best Buy employee, that is.)

Are some, maybe, a few people going to walk into their local–well, it can’t be a bookstore, but, okay, their mom-and-pop sporting-goods store–and scan stuff and then march out and buy it on Amazon? Probably, but those people are precisely the ones who didn’t support buy-local anyway.

Amazon Is Already Collecting A Ton Of Competitors’ Pricing Data. That, we know. That is what this app has been doing since its release a year ago, and it is also what Amazon does all the time. Whatever additional data the company gleans from the use of this app on Saturday is a drop in the bucket.

The Publishing Community Must Pick Its Battles Against Amazon. It is a waste of time to get mad about everything that Amazon does. And–I speak to the bookselling and publishing community here–not everything Amazon does is about books. There are plenty of other businesses for it to cut into, too! So let’s save the outrage for the stuff that is worth it, because there’s guaranteed to be plenty.

5 Responses to “Stop Freaking Out About Amazon's Price Check App”

  1. I read your article on the new Amazon “Price Check” app and I
    totally agree that this is making it even harder for small
    businesses to compete in today’s market. Our app is designed to
    help small businesses stand out and drive traffic to their stores.
    In order to compete with Amazon and help small businesses get over
    this burden we are launching a campaign that will help counter the
    effect this app is having on small businesses. “Amazon is not so Amaz-ing. Small businesses are
    important to us #occupyamazon #10bucksoff”. 

  2. mamamando

    You obviously do not work in a physical store. You have not watched you fellow employees get laid off with management saying it is due to Kindle like products and the online marketplace for lack of in store sales. They also use that as a reason to eliminate full timers and only hire part time staff to save on health insurance. You could have a deeper sympathy towards the people who fear for their livelihoods on a daily basis. Watching potential customers ask for a book, you get it for them, they like it, buy it on their phone in front of you and leave, is as damaging as it gets. So while this app  may not directly affect books,the psychological damage which has already been done is only intensified. Amazon is teaching a culture to undermine itself with the idea of saving money by losing tradition.

    • tradition?  Like covered wagons and cassette tapes and blood-letting?

      Capitalism is what it is.  I don’t like to watch people “suffer” any more than the next guy but really, what is everyone supposed to do?  Show me the rule book, please.  Seriously, if anyone has a rule book on free market economy, I would absolutely love to read it.

  3. Speaking as a publishing professional, perhaps some of the outrage from the book community stems from the fact that we’ve seen what Amazon has done to our industry and we just don’t want to see the same thing happen to others. I don’t think that’s a bad thing. There’s honor in that.
    But since this is business and speaking from a more self-interested perspective, every dollar that Amazon makes in profit comes from products other than books…meaning every dollar Amazon makes off promotions like these is one more in Amazon’s arsenal….meaning one more that can go toward poaching authors, developing Kindle-lending-like programs, and so on and so forth.

  4. TheBrett

    I agree that it’s pretty silly to get outraged over this. Places like Wal-Mart already price-match if you bring in proof, so Amazon’s price-matching is just a faster and easier way of doing that for a number of products.

    The “predatory pricing” claim bothers me as well. Lots of businesses deliberately take either no profit or even loss on products in order to sell something else (it’s called “loss leading”, or in other areas “cross-subsidization”). Apple, for example, doesn’t make a lot of money off of iTunes, but iTunes is just a tool to sell devices that can use it. Movie theaters don’t make much money off of ticket sales (in fact, I doubt they cover their expenses), but the movies are a means through which they can sell concessions (where they make their real money).

    Most whining about “predatory pricing” usually amounts to people complaining that the Big Bad Retailer is driving businesses they feel nostalgic about (such as independent bookstores) out of business.