Amazon's Loyalty Tax: IE users pay more

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By Andrew Orlowski in San Francisco, 8th September 2000

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Jeff McNeal, editor and publisher of the The Big Picture DVD site, says Amazon.com's recent random pricing has prompted him re-examine his relationship with the Seattle e-tailer.

DVD shoppers have discovered that Amazon's prices can vary wildly, with loyal registered users paying up to 16 per cent more for the same items than first-time purchasers. It's also emerged that Netscape users can gain discounts over Internet Explorer users when shopping at Amazon.

"We don't want to be precipitous, but we were not best pleased to discover our readers were not receiving the same discount when accessing Amazon through our site," McNeal tells us. "While we respect their right to test market prices, the same item should have the one price," he says.

Which pretty much hits the nail on the head. If Amazon had been upfront about offering newcomers a first-time user discount - in addition to giving regular registered users gift certficates - there wouldn't have been such an outcry from its users.

What Amazon.com has been doing in effect, is the e-commerce equivalent of having a store assistant follow you around the store, changing the price tags behind your back. It's really that simple.

Charging different prices for the same goods is illegal in the United Kingdom, which lags behind the United States in consumer protection legislation, and we suspect that in the time it takes you to say "class action", someone somewhere will be filing for redress.

We wanted to ask Amazon whether it plans to continue this "experiment", and if and how it intends to reimburse customers who have paid more for DVDs than they needed to. We also wondered if Amazon knew it was in breach of consumer protection legislation.

The company missed two deadlines to respond by press time, but as soon as they do, we'll post an update.

Amazon's pricing structure went even more wibbly-wobbly yesterday as for several hours steep discounts could be found on DVDs, including Planet of the Apes and Reservoir Dogs. Some of these still apply. (Hint: try the one with Roddy McDowall in a monkey suit). Cynics in DVD forums suggested this "accident" was Amazon's way of diverting attention from its discriminatory random pricing.

There's also a salutary lesson here for e-tailing whizz kids who have invested in the latest CRM (customer relationship management) software. With an arsenal of data mining technology, it's possible to analyse buying patterns in great depth - and set pricing schemes accordingly. But it's easy to forget that there's a customer relationship there - and that basic legal requirements cannot be ignored.

"I think their intentions were probably OK," says McNeal generously. "But it was not particularly tactful." ®

Register Trivia No.00F01H

Kim Hunter, Dr Zira in Planet of the Apes, played the role of David Niven's love interest, June, in Michael Powell's great A Matter of Life and Death.