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Re: [projectvrm] No doubt that Amazon is good to its customers?… Value-based Pricing


Chronological Thread 
  • From: Graham Hill < >
  • To: Doc Searls < >
  • Cc: ProjectVRM list < >
  • Subject: Re: [projectvrm] No doubt that Amazon is good to its customers?… Value-based Pricing
  • Date: Mon, 17 Feb 2014 16:24:29 +0000
Hi Doc

Sitting at home in Cologne.

From Amazon UK the Intention Economy is GBP 16.99 (USD 28.40) for the paper version and GBP 15.29 (USD 25.56) for the Kindle version.

From Amazon Germany the Intention Economy is EUR 17.95 (USD 24.60) for the paper version and EUR 14.41 (USD 19.75) for the Kindle version. 

From Amazon USA the Intention Economy is USD 20.15 for the paper version and USD 19.65 for the Kindle version.
I buy many technical books from Amazon. There is often considerable opportunity to pick and chose whether I have the books sent from the UK, from Germany or occasionally, from the USA, to get the lowest price.

You might like to pay attention to the following book:

Contextual Pricing: The Death of List Price and the New Reality.

Expect to see much more of 'value-based pricing' in the future.

I bought my copy from Foyles in London.

Best regards from Cologne, Graham

 

Several points here.

One is that we all have different experiences with Amazon. In some of our cases, lots of them. In my own case, I've found that, when they've screwed up (e.g. losing an order or failing to deliver), I've found people on the phone that are eager to help and do a good job. (I would say the same of Apple, fwiw, and of damn few other companies.) But I am sure that the systematic issues that T.Rob has isolated are ones worth investigating.

It is very hard to argue against success, and Amazon is very successful. Telling Jeff or anybody there that the company has systemic problems that need fixing is likely to fall on near-deaf ears. But, I could be wrong. Depends, I guess.

Amazon internally works on the 6-page-or-less memo model. If you have something to pitch in a meeting, Powerpoints are forbidden. You are to write it out in six pages or less, give it to others at the meeting, and they are required to have read it before the meeting, so they are ready to discuss it. I have also been told that this is the way to persuade Jeff or anything. So, maybe if anybody here wants to write a memo, I know people who can likely get it to him.

In my experience, Amazon's pricing is often bizarre. For some time their Kindle price for The Intention Economy was $24 or something, while their hardcover price was $16 or so. And that was on multiple browsers, including one I keep clean so there's no tracking on it. Right now the hardcover price is $20.15, and the Kindle $14.85. All browsers. And it's hardly a best-seller at this stage (nearly two years after coming out), which presumably would drive the prices up. In fact, sales are the lowest they've been in awhile. (FWIW, I know of bulk purchases made from other suppliers, at far lower prices than Amazon's.)


BTW, those other suppliers are hard to find, except through Amazon: <http://www.amazon.com/gp/offer-listing/1422158527/ref=tmm_hrd_new_olp_sr?ie=UTF8&condition=new&sr=&qid=>

Welcome to life inside the book monopoly. 


Doc

On Feb 17, 2014, at 10:20 AM, Dan Blum < "> > wrote:

But if you judge Amazon by what they actually do, I think the glass is half full, at least, and the water sweeter than that of any of their large competitors

- First big company to sell songs as MP3's for 99 cents
- Twice I had problems with a Kindle. Both times they answer the phone and one time they just sent me a new Kindle
- Once I accidentally bought two copies of the same book. I easily found the link to deal with the problem and not only did they give me a refund they didn't trouble me to mail them the second book back.
- Yesterday I got a copy of Uncle Tom's Cabin (free on the Kindle) and 99 cents for whispersync to audible.com
- I have a free linux virtual machine to play around with in AWS
- they never stalk me or bother me in any way that I've noticed

The message I'm replying to seems to question Amazon's motives and hold them up against some unstated yardstick.

I think we would do well to examine companies like Amazon from this perspective - "how could more VRM in their business model, or more focus on high-quality customer relationships, make them more money?" I'm sure they'd be interested if we gave them a well-thought out business case.

Dan


On Mon, Feb 17, 2014 at 9:58 AM, T.Rob < " target="_blank"> > wrote:

> There is no doubt that Amazon is good to its customers.

 

Seriously?  They are my go-to example of being too-big-to-care.  In my experience they are "good to customers" only so long as the customer is near the peak of the bell curve.  Do anything in the shoulder and you begin to see the customer service unravel. Get out in the long tail and there is none. 

 

I know there are Amazonians in our community and I hope they don't take this the wrong way.  What amazon does well they do extremely well. But if they are to fix the things they fall down on they must, as in the famed 12-step program, first admit there's a problem.  I'm happy to provide an extensive (but hardly exhaustive) list of issues I've personally found, all of which I guarantee to be substantive, but I do not think it is on topic for this thread.

 

> Everybody I know who works for the company, from Jeff Bezos on down, talks about how the company puts customers first.

 

Whether they do this because they believe it to be true would be an interesting discussion to have with Bezos.  He has to know there's a percentage of people like me.  If he thinks our issues are substantive and truly wants to put the customer first, you'd think he'd be reaching out to us.  However, if he thinks there is no substance to our issues and claims, then he's surprisingly clueless.  I suspect the truth is somewhere in the middle. Perhaps he doesn't know how to make VRM work in such a way as to effectively solicit our feedback.

 

> They do that, I think, mostly with low prices and efficient delivery. But one does wonder about other costs, such as the ones cited below.

 

To the extent that you pay a higher price if they believe you are price insensitive, that whole "low prices" thing is a myth.  Those who care and price shop are detected with a high degree of effectiveness and become the public voice attesting to the low prices.  Those who are less likely to notice pay more and - by definition - they don't notice.  The argument in favor of this practice is that the people paying more value other things such as service.  But I bristle over that claim because a) it's based on deception; and b) you have to deliver great service to make the claim.

 

That leaves efficient delivery. You cannot *be* an online retailer if you cannot deliver the products people buy.  Is the ability to deliver the products really the bar we set for exceptional quality of an online retailer?  I thought that would be the table stakes.  There is something to be said in minimizing exceptional cases but at the end of the day what defines great customer service is how you handle exceptions.  Amazon seems to me to be so focused on minimizing the exceptions that they figure they do not need to set a high standard when it comes to resolving them.

 

One would hope that any discussion of good companies would include their internal policies, but if we are limiting to Johannes' original criteria of companies that are good to their customers Amazon aint it.  When he posed the original question I was unable to think of a single company to nominate.  Part of the problem is that I'm old and my experience of great customer service was the indoctrination I received when I hired on at Publix.  They never aspired to be better than the competition. They aspired to be great as measured on objective criteria.  Nowadays companies seem to measure their performance relative to other companies.  Those who have become King of the Hill don't seem to notice it's a dung hill, but oh how they celebrate being on top.

 

Kind regards,

-- T.Rob

 

T.Robert Wyatt, Managing partner

IoPT Consulting, LLC

+1 704-443-TROB

https://ioptconsulting.com

https://twitter.com/tdotrob






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