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Which Price is Right?

michael posted more than 11 years ago | from the cent-of-profits-in-the-air dept.

The Almighty Buck 474

slashdotNum2Big2Register writes "An interesting article at fastcompany about how things are being priced nowadays. The only drawback that concerns me is how each item and price can be connected to an individual. Amazon was already found to be doing this with their prices."

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474 comments

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Mine is always right. (-1)

Anonymous Coward | more than 11 years ago | (#5441324)

Haha.

Might is not right (-1, Offtopic)

Anonymous Coward | more than 11 years ago | (#5441430)

"What kind of peace do I mean? What kind of peace do we seek? Not a Pax Americana enforced on the world by American weapons of war. Not the peace of the grave or the security of the slave. I am talking about genuine peace, the kind of peace that makes life on earth worth living, the kind that enables men and nations to grow and to hope and to build a better life for their children--not merely peace for Americans but peace for all men and women, not merely peace in our time but peace for all time."

-JFK, June 10, 1963.

3rd post! (-1)

thr0d ps1t (641973) | more than 11 years ago | (#5441325)

This thr0d ps1t is brought to you by the Sirius Cybernetics Corporation's Model Thr00 Thr0d Ps1t Generator.

Share and enjoy!

YOU FAIL IT ! (-1, Troll)

Anonymous Coward | more than 11 years ago | (#5441332)

Neither forst nor thord porst.

Re:YOU FAIL IT ! (0, Offtopic)

dead_sell (653640) | more than 11 years ago | (#5441409)

Neither forst nor thord porst.
I wonder of they can modify these boards to reject posts that have a mispell rate of more than 50%

Anyway, more on the subject. If you want to see an interesting way items are priced, check out the grand opening of a new Wal-Mart. A new Super-Center opened up in the next town over from where I live (which also has a Super-Center). This store is only 25 miles away yet has prices 10% more than the older Super-Center. Not only that, you can't price match between two Wal-Marts, so they gouge the prices when the store opens to get the most money.

Re:YOU FAIL IT ! (0)

Anonymous Coward | more than 11 years ago | (#5441433)

I wonder of they can modify these boards to reject posts that have a mispell rate of more than 50%

This would have the side effect of preventing most of the editors from ever submitting stories again.

On the other hand, there would probably be fewer dupes.

Re:3rd post! (-1, Offtopic)

Anonymous Coward | more than 11 years ago | (#5441423)

Shit and enjoy. When I was in the third grade there was this kid named Brandon Tompkins. He was a very strange kid indeed. I always used to make fun of his weird little whiny, uneven voice and the strange semi-southern accent he had. Whenever he would count, I would burst out laughing when he said "Tihn" instead of "Ten".

Well... we were at a catholic school together so we had mass to go to every Wednesday morning. One particular day I remember, he started telling me the most bizarre and disgusting thing I'd ever hear. He said he loved the feeling of taking a shit because he liked the pressure in his asshole. Of course, he didn't put it that way. But he told me that he liked sticking pencils in his butt and taking a crap. I was mortified.

I haven't seen the kid in about 20 years, but I am almost positive that he's got to be a bone smoker by now.

Tout

Re:3rd post! (-1, Redundant)

Anonymous Coward | more than 11 years ago | (#5441461)

but I am almost positive that he's got to be a bone smoker by now

Well, a lot of men like anal play. If I had a girlfriend I'd ask her to fuck me hard in the ass with a rubber dildo.

word! (-1, Offtopic)

Anonymous Coward | more than 11 years ago | (#5441497)

There's nothing like getting boned hard by a chick.

I think women dig it, too. They get to fuck someone instead of being fucked. There's nothing cooler than a chick who's really into it banging the shit out of your pooper.

Shouts to all you women fucking your men proper!

Re:3rd post! (-1, Offtopic)

Anonymous Coward | more than 11 years ago | (#5441509)

No wonder you don't have a girlfriend, you fecal freak.

Do think there's a woman in the world that would actually like to go spelunking in your filthy shit encrusted male ass?

FP (-1, Offtopic)

Anonymous Coward | more than 11 years ago | (#5441326)

This had better be a fucking first post or I'll nbe Pissed! [xbo.cx]

once you know (2, Insightful)

geekoid (135745) | more than 11 years ago | (#5441327)

how they determine who gets the lowest price, adjust your profile to match.

Amazon shops for me? (-1, Funny)

Anonymous Coward | more than 11 years ago | (#5441336)

So Amazon is figuring out what I want and how much I am going to pay for it?

So if I purchase a lot of items for my girlfriend, Is Amazon going to think that I'm gay?

Re:Amazon shops for me? (1, Insightful)

Anonymous Coward | more than 11 years ago | (#5441493)

They're more likely to think you're a woman.

gay != female

Airline Pricing..and others (5, Interesting)

RaboKrabekian (461040) | more than 11 years ago | (#5441339)

The idea of pricing products is to charge every consumer the maximum amount they're willing to pay. The trick is that it's usually very hard to have a purshasing system that allows such price variance. Airline pricing is one example - the closer you are to the date you wish to fly, the higher the price. (This is a vast oversimplification, but you get the idea). This is because business travelers, who need to fly at a moment's notice, are willig to pay much more than a recreational traveler, who's planning vacations 6 months in advance and shopping for the best deal. Businesses like Amazone are going to try and use every edge they can to increase their margins. From their point of view it's a great idea to use the technology they already have.

Re:Airline Pricing..and others (5, Interesting)

callipygian-showsyst (631222) | more than 11 years ago | (#5441482)

The idea of pricing products is to charge every consumer the maximum amount they're willing to pay.

This turns the conventional (American) model of retailing on its head! Typically, the POORER you are, the MORE you pay for things.

Think of the services that we offer to poor people:

  • Rent-to-own furniture stores
  • Check-cashing stores
  • Payday loans
  • Car loans
  • 19% Credit Card interest (on secured cards!)

Conversely, better-off people never pay for anything! For example I can't remember the last time I paid for an airline ticket! My company flys me around a couple of times a month, and that keeps me well-stocked in frequent flyer miles. I get samples of new computers, software, etc, because companies think I'll influence developers and purchasers.

The super-rich get even more freebies. For example, I know a bunch of folks here who got free electric cars from GM because GM wanted people in affluent neighborhoods to see others driving them.

Now, I'm not implying something's wrong here--I think many people are poor because they make bad financial choices (like payday loans!) and not because the "system" is against them. But it's true that the RICHER you are, the LESS you pay for things. If Amazon (or whoever) manages to reverse this by charging more to people who won't notice, it'll turn American marketing on its head!

Re:Airline Pricing..and others (1, Interesting)

Ed Avis (5917) | more than 11 years ago | (#5441531)

If you get frequent-flyer miles from flights paid for by your company, don't those extra miles also belong to the company? If you use them for personal travel you should at least get explicit permission for this.

There was a company making a business model out of helping other firms work around the incentive structures of airlines (which were thought to corrupt employees, making them choose the flight with the best perks, rather than the cheapest). So firms would accumulate the extra miles for themselves. I can't remember the company's name now, however.

Re:Airline Pricing..and others (1)

no soup for you (607826) | more than 11 years ago | (#5441572)

It's pretty standard for employees to rack up the frequent-flyer miles. I've actually never heard of a case where the employee had to give them back.

Re:Airline Pricing..and others (0)

Anonymous Coward | more than 11 years ago | (#5441615)

You could just order the tickets on your personal credit card (and frequent flier account), then have the company reimburse you. My dad flew halfway across the country twice a week for a couple of years on the company's dime and racked up a HUGE number of miles. We could go just about anywhere in first class for nothing until they ran out.

I'm sure the IRS probably has something to say about it, so enjoy it while you can.

No. (1)

sulli (195030) | more than 11 years ago | (#5441621)

No miles, no business travel. Miles are a very appropriate perk for sitting in an O'Hare departure lounge when one could be at Ocean Beach (for example).

Re:Airline Pricing..and others (2, Insightful)

goodviking (71533) | more than 11 years ago | (#5441662)

If you get frequent-flyer miles from flights paid for by your company, don't those extra miles also belong to the company?

No. Frequent flier miles are tied to the name on the ticket and not to a corporate entity. If the airlines allowed corporations to accrue miles as opposed to individual employees, then the corp would purchas far less tickets with actual money, and far more with mile, hurting the bottom line.

Re:Airline Pricing..and others (0)

Anonymous Coward | more than 11 years ago | (#5441555)

Plus the rich don't have to pay rent, they just buy a house then resell it when they want to move. Bastards.

Fleecing the poor (5, Insightful)

SpikeSpiff (598510) | more than 11 years ago | (#5441583)

At first I read this as a troll. But I think the issue here is that the poster does not recognize that risk costs money.

Financial services to the poor have, all else equal, much higher default risk. And default costs swamp everything else. Consider that the margin over cost of funds for most consumer credit is 2-3%. A default rate of 1% destroys the profitability.

And the proof of this is in the market. Credit companies are neither bashful nor shy. If there was money to make, your friends and Cap One and First USA would divert some of 1 billion or so peices of mail then send. Alliance capital tried and went bankrupt. Cap One tried, but was punished in the stock market for the risk.

The other minor effect is transaction costs. There is a smaller denominator to spread costs across. 1% of an $800 paycheck is different than 1% of a $200,000 mutual fund purchase.

This reminds of the myth about women being paid around 70% of what men are. If true, there must be someone out there hiring only women and killing their competitors with wildly lower labor costs. Ought to be easy, women are around 40% of the labor pool.

Oops. Doesn't seem to be happening. I know I'm willing to try it.

Re:Airline Pricing..and others (3, Interesting)

joedoe (12577) | more than 11 years ago | (#5441627)

While you're right about predatory practices that American businesses often engage in, this is a different issue altogether. Those practices mostly hinge on the scarcity of money among the poor, and hence their greater tendency to utilize expensive credit.

Think of the automobile market, which was one of the first examples of someone creating divisions within the market (at GM) to capture more of the money that consumers were willing to spend. The (relatively) poor can buy cheap K-cars, while those with more money settle on better-equipped models, and those with more go for Merecedes, and so on. Without differentiation of products, everyone would have bought a car, sure, but they wouldn't have paid nearly as much for the cars, and the automakers wouldn't have made anywhere near as much money.

In a way, this is an extension of the product-differentiation model, with the idea being that differentiating by individual rather than by class can get them even more of the consumers' money. Inherent in all this, of course, is that they want their tactics to remain (at least relatively) hidden from consumers, fearing the backlash.

I doubt the legality of that, so we're perhaps more likely to see all businesses in a given area settle on similar practices, and then it doesn't matter if they're open about them.

Ever heard of Safeway? (0)

Anonymous Coward | more than 11 years ago | (#5441489)

This is no different thant real-world shopping. What do you think your grocery store membership card gets you? In my experience, mostly higher prices on regular items and regular prices on "sale" items.

hahaha (-1, Offtopic)

Anonymous Coward | more than 11 years ago | (#5441341)

it depends. i like it that way ;-)

POOP!!! (-1, Troll)

Anonymous Coward | more than 11 years ago | (#5441343)

poop

Old Hat (5, Interesting)

RazzleFrog (537054) | more than 11 years ago | (#5441347)

Catalogs have been doing this for years. Why do you think they ask you for that catalog code when you call up to order? B&M stores do this by region also. I was in the Gap in Mt. Kisco New York the other day and jeans were $10 more than the same thing in Danbury, CT.

Re:Old Hat (4, Insightful)

corbettw (214229) | more than 11 years ago | (#5441475)

"I was in the Gap in Mt. Kisco New York the other day and jeans were $10 more than the same thing in Danbury, CT."

Don't forget that state taxes are higher in NY than CT. Sure, the sales tax won't show up on the price tag, but all the other "incidental" taxes (road taxes and tolls, for instance) will. Also, if one store has a higher rent or CMA (Common Area Maintenance), expect higher prices. So the $10 might not be all bilking the customers, there could be higher costs in one area (most likely it's a combination of all of the above).

Re:Old Hat (1)

RazzleFrog (537054) | more than 11 years ago | (#5441526)

I used Danbury as an example but that Gap had higher prices than any other I have ever been in. Men's jeans were like $49. Rent is part of it I am sure but Mt. Kisco is very affluent. There are homes there that would fit ten of mine.

Re:Old Hat (0)

Anonymous Coward | more than 11 years ago | (#5441658)

Except Danbury is in Fairfield County, the richest county of the richest state (per capita).

Re:Old Hat (3, Insightful)

Kevin Stevens (227724) | more than 11 years ago | (#5441533)

Well store prices are also affected by costs- labor, rent, proximity to warehouses, etc- since they are also driven by profit margins. Im not really sure where Mt. Kisco is, but I will assume it is right next to the sticks, or a few miles down the road from bumblef*ck. Danbury, CT has a higher cost of living, and as such, has higher prices. Most of CT is pretty well off, so the laws of supply and demand come into play too. My point is- It is not quite as shady for a retailer to do this as a catalog... who other than shipping costs (which they already clip you for anyway) should have a fixed cost of doing business for a given region.

Not surprising that no one will talk... (5, Insightful)

sphealey (2855) | more than 11 years ago | (#5441352)

Finally, she pleaded, "If I talk about prices, I could go to jail." The spokeswoman for a telecom company said, "We're not going to talk about prices, and the fact that we're not going to talk about it is off the record. You can't use the fact that we won't talk about prices in a story."

But it was not until I traveled to Chicago, to a Professional Pricing Society conference, that I got a full picture of how sensitive the subject is. On my first day, I was asked to leave the trade-show exhibits -- the place where vendors beg for attention. A guard was posted at the door, in case I tried to slip in. On the second day, Eric Mitchell, president of the PPS, spotted me standing in the lobby outside the meeting rooms and scowled.

Given that most of the practices that the author describes are gross violations of the Robinson-Patman [businesslaws.com] and Sherman Anti-Trust Acts, I am not surprised that no one wants to talk about them on the record! Per-person pricing for indistinguishable goods was made illegal in the US in the 1920s, and as far as I know has never been made legal since. The real question is how businesses get away with such behaviour today.

sPh

Re:Not surprising that no one will talk... (5, Interesting)

mugnyte (203225) | more than 11 years ago | (#5441507)


He states this later in the article: It's not per-person, it per market state. Airline prices are reactive to the market 17 replications a week. Also, the ability to offer incentives are legal, whereby a frequent customer, a collaborative discount with a hotel (in this example) changes price.

When it reads that prices are all over the map, you can be sure that booking a flight with a friend will result in similar prices at similar times if you sit int he same purchaser demographic. That is not per-person.

mug

Re:Not surprising that no one will talk... (4, Interesting)

sphealey (2855) | more than 11 years ago | (#5441571)

He states this later in the article: It's not per-person, it per market state. Airline prices are reactive to the market 17 replications a week. Also, the ability to offer incentives are legal, whereby a frequent customer, a collaborative discount with a hotel (in this example) changes price.
I hear you. Problem is, if there are 300 million residents of the USA, how do I distinguish between "market pricing based on 300 million market states" and per-person pricing?

sPh

The answer is simple. (1)

Angry White Guy (521337) | more than 11 years ago | (#5441514)

You don't make per-person prices. You make prices based on a metric assload of seemingly indistinguishible criteria which take so long to figure out that you can't be convicted of per-person pricing. If there is a method to the madness which nobody can understand but you, and you are making an increased profit, then you've done something right.

Re:Not surprising that no one will talk... (0, Troll)

BigBir3d (454486) | more than 11 years ago | (#5441522)

The real question is how businesses get away with such behaviour today.

$

Re:Not surprising that no one will talk... (2, Funny)

CrazyDuke (529195) | more than 11 years ago | (#5441536)

"The real question is how businesses get away with such behaviour today."

bool getAwayWithIt(opinion& publicopinion, law& thelaw, gains potential, polititian congresscritter) {
bool permission=false;
while (!PRMess(publicopinion, thelaw, potential) && permission!=true) permission=congresscritter.lobby.addmoney();
if (permission==true) thelaw.setEffect(NULL);
return permission;
}

Re:Not surprising that no one will talk... (2, Informative)

SpikeSpiff (598510) | more than 11 years ago | (#5441603)

IANAL, but in business school they taught us that the law protects B2B transactions, not B2C.

Re:Not surprising that no one will talk... (1)

og_sh0x (520297) | more than 11 years ago | (#5441650)

Illegally tiered pricing is just as big of a problem for B2B as B2C. After all, Qwest was recently convicted of illegally extending special pricing to certain VARs, on the condition that they did not discuss the special pricing.

Re:Not surprising that no one will talk... (4, Informative)

nelsonal (549144) | more than 11 years ago | (#5441628)

Those acts deal with predatory pricing, which is pricing to eliminate other businesses. It is usually defined as pricing below marginal cost, or as a proxy pricing below average variable costs, since there is no sense in a one term price below variable cost. Company's occasionally will sell at a loss, if the loss of production is less than the loss that could be had if the plant were shut down and fixed costs were eaten. In a simple case, imagine if firing someone costs $30,000, but employing them for $40,000 only brings in $20,000 in profit. You would keep them assuming you planed business to pick up in less than 1.5 years.
Pricing below average variable costs means that you are paying an employee more per hour than you bill, as one example. Obviously in that case, you would be better off eating your fixed costs, since you aren't covering them anyway. That act only applies to price discrimination that impairs competition. You have to do it in such a way to close down mom & pops with the goal of monopolizing an industry. Per person pricing for indistinguisable goods are legal, if he is making a profit on all his sales. Rebates would be a good example of this, by using a rebate to catch the highly price sensitive, the retailer can capture both price sensitive sales (at the lower margin), while charging more to those who are less price sensitive. Also the section on functional discounts gives most companies plenty of room to avoid breaking the law.

to be expected (3, Interesting)

flynt (248848) | more than 11 years ago | (#5441355)

this is only an extension of regional pricing. take a trip around town and look at gas pricing in different areas, it differs dramatically. now, each individual is becoming his/her own region.

Re:to be expected (1)

k3v0 (592611) | more than 11 years ago | (#5441540)

gas is slightly different though, since different gas stations pay different amounts based on property values for their stopres, different local taxes, etc. . amazon does not. also, since it is the world wide web, they are operating in one region, the world.

Stupid Pricing (1, Flamebait)

Tisha_AH (600987) | more than 11 years ago | (#5441358)

This takes the idea of "what the market can bear" to an extreme. What's next, charging higher interest rates to people who like in bad neighborhoods? If you went into a store and bought a bag of doughnuts it wouldn't be right if they charged you more for being of a certain ethnic persuasion. It seems that it is going to be an acceptable practice if you use Nutscrape over I-Exploder. I like my cookies with milk. Not higher prices!

Re:Stupid Pricing (4, Interesting)

sphealey (2855) | more than 11 years ago | (#5441402)

This takes the idea of "what the market can bear" to an extreme. What's next, charging higher interest rates to people who like in bad neighborhoods?
Actually, that was not only common practice from the invention of the home mortgage (1880?) through the civil rights era (1975), it was actually required by the (US) Federal Government. Crabgrass Frontier (ISBN: 0195049837) has a good description of how the Department of Housing and Urban Development systematically went through their files around 1970 and shredded all references to the "Mortgage Quality Maps", but some documents survived. Banks were not allowed to write their best loans in areas with more than a certain percentage of "undesirable" residents.

sPh

Re:Stupid Pricing (1)

Unregistered (584479) | more than 11 years ago | (#5441517)

I like cookies too

Re:Stupid Pricing (1)

AngusH (611073) | more than 11 years ago | (#5441641)

Charging higher interest rates to people in bad areas already happens (kind of). Sub-prime lending companies target their products and services at poorer areas. The products on offer carry worse terms than products aimed at better areas and better off people. While theoretically there is nothing to stop the people who are the target customers of the sub-prime lenders going elsewhere in practice there are various barriers. Also many of these companies are owned by larger banks and financial institutions. (HSBC recently bought Household International.) So in essence these companies have more attractive products available to people who are better off.

Re:Stupid Pricing (1)

meowmonster (444185) | more than 11 years ago | (#5441666)

At some school (can't remember which one, sorry maybe someone can jog my memory) they did a bake sale or something and charged people based on their ethnic persuasion different prices. It was to demonstrate what is wrong with affirmative action. White people were charged more for items than blacks, etc... Actually worked really well.

In loans they have a better gauge than what neighborhood you live it to determine your credit risk, it's called you credit report. Now, it wouldn't surprise me that you won't find a bank in "poor" neighborhoods giving out as many low interest loans as you would in a high income suburban area. I am sure that if you look at the statistics you will find that there average credit report in those neighborhoods will be in much worse shape (I've seen this, 4 years ago I lived in a trailer court where almost everyone was related to each other). Now I am sure that if someone who is very careful with their spending and had a good credit report went in there they could get a good loan.

Regardless, when you buy something you are making a contract with the seller. You are telling him that that price is good enough for you and you are willing to pay that much. If not, then you wouldn't buy it (or you're ignorant). If amazon's (or anyone's) pricing practices are suspect and you are not comfortable with what they are offering then noone is forcing you to purchase from them. Sooner or later as that spreads they either have to changes their practices or go out of business.

Now I don't like what they are doing and as word of this kind of stuff gets out I will make my decisions on who I am going to do business with. But if I shop around and find the "best price" and am willing to pay for it, that has nothing to do with the next guy paying more or less than me. Obvoiusly I am going to go for the best price I can but once I hand over my money I am saying it is good enough for me.

I don't get why this is such a big deal... (4, Insightful)

Akardam (186995) | more than 11 years ago | (#5441359)

Different prices for different people or companies for the same product is not a new thing. Anybody who's purchased a car knows this. Based upon things like your credit rating, how much you put down, how badly the salesman wants to get rid of it, etc, you're going to probably pay a different amount than the guy right next to you, even if it's off by only a couple pennies. The same goes for my company. We custom build PC's. Our corporate customers, who for example buy in bulk, are going to pay less per unit than Joe Schmoe who walks off the street.

Call me old fashion, but I've always seen this as normal. Not necessarily fair, but at least something not entirely unusual, or dangerous, or something to get up in arms about.

Re:I don't get why this is such a big deal... (4, Insightful)

secolactico (519805) | more than 11 years ago | (#5441431)

Anybody who's purchased a car knows this.

Well... no. That's bargaining, and I believe it is a different subject.
Usually, a car has a starting price. This is the official price. Everybody starts off the same price and then negotiates a lower one. If you walk into a car dealership and the salesman changes the price after taking a look at your clothes, then yes, it's the same.

Where I live, car dealerships have a "ticket price" on each car displayed. I don't know if they are required by law to do it, tho.

Well, maybe not the best analogy... (1)

Akardam (186995) | more than 11 years ago | (#5441515)

Having purchased a car recently might have been why :)

Anyway, AFAIK the sticker price is what the manufacturer thinks the car should be sold for, in other words, the MSRP. But even this will vary from region to region! The bargaining aside, you will pay a different price based upon, as I said, things like your credit history (determines what kind of rate you get on any financing). This is still profiling, which is exactly what Amazon did and others do from time to time.

Re:I don't get why this is such a big deal... (2, Interesting)

corbettw (214229) | more than 11 years ago | (#5441548)

Someone else has already addressed haggling over car prices, I'll address bulk buying. There's a huge difference in having break points on bulk items than in charging two different people the same price for the same amount of the same object(s).

For instance, you and I go into Kinko's and order business cards. We each order three color cards, on the same stock, with the same ship-by date. If we both order 100 cards, we should pay the same amount. If I order 1000 cards, I'll pay more overall, it'll just be cheaper per card (Kinko's wants to encourage you to buy more cards, and the highest cost to them is in the initial setup, anyway, so it's pretty much all profit after that gets paid). BUT, if we both order 100 cards and I pay more because I'm richer than you (or perceived to be), that's wrong.

Another reason not to use IE (5, Funny)

molarmass192 (608071) | more than 11 years ago | (#5441361)

using a Netscape Web browser turned up a quoted price of $64.99 -- 35% off the original price of $99.98, according to the online retailer. But several seconds later, a similar search performed with Microsoft Corp.'s Internet Explorer browser resulted in a price of $74.99 for the same product.

As if folks needed more reasons to use Mozilla!

Use Mozilla... (3, Funny)

ryanvm (247662) | more than 11 years ago | (#5441366)

From the ComputerWorld article:
a search for the Planet of the Apes DVD on the Amazon site using a Netscape Web browser turned up a quoted price of $64.99 [...] several seconds later, a similar search performed with Microsoft Corp.'s Internet Explorer browser resulted in a price of $74.99 for the same product
Damn, if that's not a reason to use Mozilla, I don't know what is.

Re:Use Mozilla... (1)

Masem (1171) | more than 11 years ago | (#5441449)

Uh, I'm more curious as to that $65 or $75 price tag for a DVD, much less the Planet of the Apes DVD!

(most likely, they're talking about the DVD set of the classic Ape movies, rather than the poorly done remake of the last few years...)

Re:Use Mozilla... (1)

phorm (591458) | more than 11 years ago | (#5441455)

Yes, but doesn't it sound like an imminent lawsuit by Microsoft and others once they find out that users of their browser are having to pay more?

Re:Use Mozilla... (3, Informative)

dissy (172727) | more than 11 years ago | (#5441629)

I dont think its so much due to the fact its IE vs Netscape, the reason they pointed this out was because its a totally different browser with different cache/history/cookies/etc so the server had no way to know it wasnt the same person.

Re:Use Mozilla... (0)

Anonymous Coward | more than 11 years ago | (#5441659)

Don't they allready pay more, f. e. for their OS?

P2P pricing system? (3, Interesting)

cmburns69 (169686) | more than 11 years ago | (#5441368)

"The only drawback that concerns me is how each item and price can be connected to an individual."

Should this come to pass on a widespread basis, it could be counteracted by some sort of open pricing network, similar to P2P.

Somehow the system knows what prices I can get for an item, and what prices anybody else logged in can get, and routes the purchase through that person...

Similar to pricewatch, but more community based rather than retailer based... .. Anyway, its just an idea! ..

An online Starcraft RPG? Only at [netnexus.com]

Airline Prices!? (1, Redundant)

lavalyn (649886) | more than 11 years ago | (#5441377)

If that's not the best example of when people don't know what to price at, I don't know what is. Go to (say) expedia, travelocity, or destina.ca and price out a round-trip flight to some interesting place (I suggest Osaka). Prices range from $1400 to $6000 (CDN) on what is basically the same flight, with the same restrictions, at even the same timing conditions. And the expensive flights often include more stopovers and transfers too!

Perhaps with a $4 difference we may think differently, but I'd choose the cheap option any day when the difference is $300.

More power to them (2, Insightful)

BillFarber (641417) | more than 11 years ago | (#5441385)

This is capitalism. They aren't permitted to collude with other businesses, manipulate the market, or discriminate. Other than that, they have the right to set prices anyway they see fit. They can use the information they glean from you to adjust prices. However, the consumer must keep in mind that they need to get as much information about the product and competing sources as well.

Re:More power to them (1)

phorm (591458) | more than 11 years ago | (#5441476)

Yet the gas companies seem to get away with it. It's not as simple as "look out the window see what the guy next door is doing." Sometimes in the case of price ways it might be... but I remember hearding of a "gas guy" who used to ask various companies what the price should be, and passing the info on so they could all hit the same highs.

Re:More power to them (1)

CrazyDuke (529195) | more than 11 years ago | (#5441578)

That is not discrimination? If I charged a rich black person more than a poor white person, I would have a lawsuit so big over my head I might as well just put a bullet in it.

Ad (0, Troll)

mgs1000 (583340) | more than 11 years ago | (#5441392)

All this article seems to be is an advertisement for this pricing software.

catalogs (3, Interesting)

mgkimsal2 (200677) | more than 11 years ago | (#5441394)

Not quite individual level, but we get many catalogs for previous occupants of our current office space. Dell, in particular, sends multiple catalogs here. What I found very interesting is that 2 Dell catalogs - indentical in products offered - often have different pricing based on the recipient. The even more interesting thing is that both recipients worked for the same company at the same time, but one was male and one was female, and they were being offered at different prices. The 'product code' was the same, but the 'catalog code' (or something like it) was different. I can not remember if the prices were higher for the male or the female - sorry...

nowadays = September of 2000? (5, Informative)

patmfitz (517089) | more than 11 years ago | (#5441396)

how things are being priced nowadays ... Amazon was already found to be doing this with their prices
The article about Amazon was from September of 2000 - after which they stopped doing it.

gold box (0)

Anonymous Coward | more than 11 years ago | (#5441504)

actually they they are doing it more than ever - see their gold box feature?

Re:nowadays = September of 2000? (4, Insightful)

luzrek (570886) | more than 11 years ago | (#5441570)

The article about Amazon was from September of 2000 - after which they stopped doing it.

Not true, in December 2002 we wanted to buy the Band of Brothers video collection for my grandfather-in-law. When my wife and I looked at it (we are frequent amazon.com customers) it was $80. When my mother-in-law (doesn't shop online) looked at it it was $100. Ergo, Amazon.com still does the individualized pricing thing.

The individualized price thing was commonly done in retail until Sears and Roebuck introduced the single price concept near the beginning of the 20th century, allowing them to have more poorly trained sales staff therefore allowing them to make lots of stores very quickly. Very high end and very small volume stores have never stopped doing it since the salesmen/owners at these stores ussually have a good idea what prices their customers can tollerate. Large stores couldn't get to know the customers well enough to do this. Looks like large stores track you well enough to do this now.

Hows this for double-talk (3, Informative)

sdjunky (586961) | more than 11 years ago | (#5441404)

"We've learned that certain aspects of our site resonate with customers in different ways, and we are continually fine-tuning our site presentation to see how these variables affect customers' purchasing decisions"

Last I checked... If you want to determine if "site changes" cause increase in purchasing etc you leave the price of a product static. This way you can determine if the increase came from better navigation. The price would be your static variable.

I bet that most people who read this ( not those of slashdot but of the world at large ) would fall for this simple and elegant lie.

The science of pricing, Microsoft Style (0)

burgburgburg (574866) | more than 11 years ago | (#5441412)

When the licensee stops bleeding, check his/her relatives. They're still moving, and softly groaning in the corner.

what a waste (0)

Anonymous Coward | more than 11 years ago | (#5441418)

i NEVER buy anything online, i rather buy at a local brick & morter store where i can see, touch, and have a good in person gander at what i am thinking about buying...

Special Offer!! (2, Funny)

mcd7756 (628070) | more than 11 years ago | (#5441419)

We're offering this post for $5.00. Shortly we will raise the price by 11.2%. Eventually you may read it for free, but only if you have the coupon.

::sniff sniff:: (5, Funny)

Ayandia (630042) | more than 11 years ago | (#5441421)

Hey, is that a discrimination lawsuit I smell?

Amazon Exec 1: "This customer buys Precious Moments figurines."
Amazon Exec 2: "They must be some middle-aged soccer mom. Charge them double for new releases, and half price for Disney."
Amazon Exec 1: "What about customers who buy How to Make a Million Dollars a Second?
Amazon Exec 2: "Charge double for everything. They'll be able to afford it eventually..."

pricing discussions (5, Interesting)

mgkimsal2 (200677) | more than 11 years ago | (#5441427)

There are a few forums I used to frequent, one for webmasters. It was mostly freelancers or one-man shops, from what I could tell, but the forum moderators were strict to the point of being stupid over 'pricing discussions'. "We can be sued for supporting price fixing" is the standard response.

One person asked what it was customary to charge for a certain type of service. I replied back that I've seen people charge anywhere from $50 to $1500. *THAT* was considered 'potential price fixing'. How a number with a variation of hundreds of percents could be 'fixed' is well beyond my comprehension.

You'd think then that magazines or websites which have pricing on them (like, for example, ecommerce sites) would be collaborating in price fixing, as they can see info from other companies, and those companies can see their info, and adjust things accordingly.

There's a difference between knowing what someone else charges and actively engaging numerous people to all sell at a particular price, but people don't seem to see the difference.

Re:pricing discussions (4, Interesting)

MacJedi (173) | more than 11 years ago | (#5441466)

I'll tell you why they didn't want you to talk about it: asymmetric information [nobel.se] benefits the supplier.

Re:pricing discussions (1)

NineNine (235196) | more than 11 years ago | (#5441645)

It sounds like we were on the same forum ;)

Amazons pricing (5, Interesting)

Foofoobar (318279) | more than 11 years ago | (#5441438)

I was a buyer at Amazon from 95-97 and helped build their buying dept and I can tell you that it is even more insidious than that. They buy straight from publishers/manufacturer when they can on almost all of the most popular items so they can get a 55-60% discount.

And thanks to me, they get a killer deal on shipping due to a little known program known as consignment shipping via UPS so they pay less than half of what they normally would pay; though they charge you for the full price of shipping, nearly all of this money goes straight into their pocket. They now claim it is for the manpower to ship your book but I have an Uncle that works for the warehouse down in Nevada and gets paid minimum and the time it takes to fill an order is less than 3 minutes ($10/hr x 3 seconds = approx 0.75).

Now, they then charge full price and have items that they overstocked pull up higher in searches with edited customer reviews to make them appear better than they are. True fact. They started editing reviews back when I was there.

Oh the horror stories I could tell...

"...people just like the feel of a dead tree in their hands." -Jeff Bezos

Then on top of that

Re:Amazons pricing (1)

Foofoobar (318279) | more than 11 years ago | (#5441457)

Oh forgot to mention, prior to discounting products, they would always hike the prices.

Re:Amazons pricing (1)

mugnyte (203225) | more than 11 years ago | (#5441593)


Interesting, but still not more deceptive than department store chains, for instance. Price hikes/cuts, testimonials (or "user-reviews" on Amazon), prominent display of the overstock, these are fair game in shopping.

Amazon has created a way to mimic the antics of a brick n mortar shop, but they still cannot overcome a certain level of saavy online shopper:

- Multiple, unrelated consumer review sources
- Broad, multiple price comparison lists
- The used/auction resources

Then, offline, we're talking garage sales, liquidators, etc. The more I write, the saavier the shoper, IMO, but for one willing to wait and slowly pick through the information, quality can be found at a competative (to the market at the time) price.

mug

Re:Amazons pricing (5, Funny)

The Ribena Kid (140177) | more than 11 years ago | (#5441607)

Now, they then charge full price and have items that they overstocked pull up higher in searches with edited customer reviews to make them appear better than they are. True fact. They started editing reviews back when I was there.

This can't be true, they don't mention anything about editting in their patent [uspto.gov] on discussing an item.

;-)

Journalism ethics (2, Funny)

JudgeDredd (561957) | more than 11 years ago | (#5441473)

From the article: The spokeswoman for a telecom company said, "We're not going to talk about prices, and the fact that we're not going to talk about it is off the record. You can't use the fact that we won't talk about prices in a story."

So he goes and prints it anyways? Can he do that?

Re:Journalism ethics (4, Informative)

evilpenguin (18720) | more than 11 years ago | (#5441513)

If he doesn't name the person who said it or the company for whom she works, yes. That's what "off the record" means. It doesn't mean you won't repeat it. It means you won't attribute it to the real source.

Re:Journalism ethics (1, Interesting)

sphealey (2855) | more than 11 years ago | (#5441553)

From the article: The spokeswoman for a telecom company said, "We're not going to talk about prices, and the fact that we're not going to talk about it is off the record. You can't use the fact that we won't talk about prices in a story."
So he goes and prints it anyways? Can he do that?

Until doing so is declared a violation of the USA Patriot Act, sure. At least at the moment in the US we still have a concept called the First Amendment. There is no legal concept of "off the record" - it is just a professional courtesy between people who make the news and those who report. All it means is, 'if you publish this I will only talk to your competition from now on'.

For the moment anyway. It would not surprise me a bit to see organizations trying to use laws such as USA Patriot (particularly version II) to censor reporting that they don't like. But not yet.

sPh

Re:Journalism ethics (0)

Anonymous Coward | more than 11 years ago | (#5441579)

No: if some guy tells you what you can and can't print, you have to do what they say. This is known as "freedom of the press (to do as they're told)".

Music Industry (2, Informative)

SiuanSanche (649696) | more than 11 years ago | (#5441478)

I used to work at a music store, you know, one of those places that sells one damned cd for $16-$18. Anyways, I was reading online at VH1, after some searching, I found the article. What makes me sad is that people went and supported the stores involved anyways. Not sure how to make this a link, but here's the URL for that story: http://www.vh1.com/news/articles/1457874/10012002/ id_0.jhtml

Re:Music Industry (1, Informative)

Anonymous Coward | more than 11 years ago | (#5441652)

Not sure how to make this a link, but here's the URL for that story: http://www.vh1.com/news/articles/1457874/10012002/ id_0.jhtml

to make it a link, type it as <a href="http://www.vh1.com/news/articles/1457874/100 12002/id_0.jhtml"> the text of the link</a>
and yes, there is a space between the a and href, it wasn't added by slashdot

for those to lazy to copy and paste [vh1.com]

Doesn't work for educated consumers (3, Informative)

afidel (530433) | more than 11 years ago | (#5441495)

With sites like pricewatch.com, pricescan.com, and other competitive shopping sites I know what the market price is for any goods I buy online (generally big ticket electronics items, though I have used similar methods to check large appliances), so how does anyone ever pay much more than the market price for an item that isn't unique to a single online vendor? Do people really make impulse buys online?

PPD (2, Informative)

alaric187 (633477) | more than 11 years ago | (#5441512)

Perfect price discrimination isn't new. It's just very, very hard to do. With today's technology and consumers, it's a lot easier to guess at the price that each customer will accept. For more on PPD, check any low level econ text. [amazon.com] or book on economic game theory [amazon.com] . Or check out some Mises [amazon.com] for those economically inclined poor souls who believe in the price of a good equals the amount of labor involved.

Neocapitalist Model? (1, Interesting)

Anonymous Coward | more than 11 years ago | (#5441516)

Haven't beefed up on Ricardo or Smith recently, but is this how supply and demand is supposed to work?

Sure, the ultra-rational producer is there, but my understanding was that the system was designed to ensure efficiency by forcing producers to increase the marginal value they're providing by securing efficiencies in their supply chain. So clothing chain A is not doing well because it sells "overpriced" products relative to chain B, so chain A is required to secure cheaper or superior manufacturers for their products (often through the use of technology). Cost minimization vs. price maximization. I'm somewhat at a loss to see how these technological efficiencies can be developed by price maximization. Is this the phenomenon Kenneth Galbraith was bemoaning over 30 years ago? Is this not just a formula for inflation with no discernable improvement in living standards?

Telesales Insurance etc.. (1)

ItsIllak (95786) | more than 11 years ago | (#5441525)

It's been the mainstay of many telesales insurance companies, and companies like them to have x% of people answering the phone quoting price a. Then, to meet sales quantity targets you add certain numbers quoting at 5 or 10% lower, or 5 or 10% higher.

I don't really see the problem with charging people what you think they'll pay. It's been the mainstay of small business for years. You charge government fortunes, and penny pinching startups with low margins.

If amazon quote me a price, I'll be checking with their competitors anyway. If it beats them, fine, if not, bye..

I just experimented on Amazon! (-1, Flamebait)

Anonymous Coward | more than 11 years ago | (#5441549)

I just did this experiment on Amazon!

I used a web-proxy that lets me fake my User Agent. I made it say I was using a Macintosh.

When I visited Amazon with my "macintosh", it assumed I was gay, and featured ads for dildoes, and lube.

And, under music, it had Judy Garland CDs for 30% MORE than the prices if my User Agent says "Windows XP"

Pretty clever, Amazon!

insightful... (0)

mike77 (519751) | more than 11 years ago | (#5441554)

wow, customers won't buy something if it's priced to high...

Quick call the RIAA! we've found their problem!

What I do with Amazon.. (5, Informative)

antis0c (133550) | more than 11 years ago | (#5441562)

I've known this for a while now. I have a small network at home, a number of Windows workstation, a few Linux workstations and a number of OpenBSD servers. What I do is look for an item on Amazon I want to buy, then go to that item on every available browser on every computer at home. Through Netscape, Mozilla, IE, Konqueror, Opera, Phoenix and Galeon. Then I complete the purchase from the cheapest one.

It's worked very well for me. Some browsers were as much as 30 dollars more than others for larger priced items. That to me would seem like a grey area in the legal system. You aren't allowed to charge varying prices at regular stores based on the customers appearance. You'd see Walmart getting sued left and right if at the registers they charged 15% more because I was wearing a suit and tie as opposed to looking like white trash. Or charging more for black comedy DVD's if you are black, the ACLU would be all over them in a heartbeat.

Customer Collusion (2, Interesting)

travdaddy (527149) | more than 11 years ago | (#5441581)

There are a lot of posts worrying about business collusion, but what about customer collusion? A site like PriceWatch should be able to go through a website and collect prices under different profiles.

Then, as a customer, I might get a little annoyed knowing that a company is trying to sell me a book for $20 when I know Person X can get it for $15.

Shop at the dollar store (4, Insightful)

idiotnot (302133) | more than 11 years ago | (#5441596)

That way, you never have to worry about prices.

But seriously, objective pricing probably is gone. Why? Well, we've transitioned to a service-based economy, and it's difficult to stick a price label on an intangible product (intellectual property, anyone?).

What makes a copy of XP Pro worth $299? Nothing. The box and the disks themselves are probably only worth a few bucks. And people know that MS runs 85% margins on these things, but still continues to buy them. And when so much of the economy is based on sales of intangibles....

Same goes for getting work done on your car. How much money does a head gasket cost? Well, the gasket, itself, is under fifty dollars. How much does a head gasket job cost? That's a different question entirely, now isn't it?

Happy Gilmore Says: (0)

A Swing Dancing Dork (324614) | more than 11 years ago | (#5441598)

The price is wrong, bitch!

moderator sez (0)

Anonymous Coward | more than 11 years ago | (#5441625)

Gee I wish there was an "Inane" moderation that didn't change the points.

It would be a nice way of saying "don't bother wasting your points on this post, it's not worth the effort."

All of this neglects to mention one thing (4, Interesting)

Stubtify (610318) | more than 11 years ago | (#5441653)

Well the article mentions how technology is helping the businesses, but not the consumer. Yes Amazon keeps track of your past purchases, yes if I search for anything there is a list of "suggestions" on the side. Yes I may not see the same prices as you do, but all of this doesnt matter for one reason.

I can go anywhere I want to buy anything amazon has to offer me. The internet allows me to shop around with minimal effort. "Memory sticks are $52 at amazon? Well I saw them at compusa for $42"

I'm not worried about this because I don't shop and expect to get the lowest price unless I do some work. That amount of work has lessend with pricewatch and other deal sites, and this is where I think technology is hurting companies. Its too bad that neither article mentioned this, I would like to see how they plan on combatting it. Remember when "price matching" was all the rage?

I mean, amazon.com's prices are usually very flexible, they flood the market with coupon codes, free shipping, and so what if they charge more to an idiot who is willing to pay it. If they notice you're only buying the things that you see as being cheapest from them they'll realize whats up or their software isn't worth jack.

airlines created their own mess by chaning prices (4, Insightful)

bhdaly (646097) | more than 11 years ago | (#5441667)

"Collectively the airlines change prices 75,000 times a day". All airline customers have been trained to shop around because of this. There is no company or brand loyalty because the customer knows if they dont shop for price they WILL get screwed. Instead of focusing every cent on how to undercut every other supplier, try providing the customers with quality service at affordable and consistently affordable rates. Customers do not want to be in the price shopping business. That is a lot of work. They want a ticket at a reasonable price. If one airline gave consistently affordable rates and decent service, customers would come back to that airline with confidence instead of changing airlines everytime because of a price blip. That is not possible with the current environment where the same airline will charge you $1000 more depending on some whim from a competitor. And this is touted as science?

everyone does this. (2, Insightful)

sirshannon (616247) | more than 11 years ago | (#5441671)

I charge my customers depending on the size of the client. Huge medical conglomerates pay more (per hour and per project) than my next door neighbor or my favorite local band.

International businesses charge Americans more than they charge someone who makes $2 a week.

students get discounts on almost everything

ladies get in free on Thursdays.

etc, etc, etc...
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