Ever wondered after snagging that deal on Amazon (45 % off!), whether it was the best possible deal? Did someone get better deal yesterday or last week? Worse still, is someone getting a better deal right now?
It is now more possible than ever before for Amazon to price a product differently to different people (based on their assessed ability to pay or desperation/need for the product) at the same time, and no one is the wiser! A brick and mortar (B&M) retail checkout counter or a mom and pop store cannot sell a product for different prices as there is always someone behind you watching the transaction. In case of B&M retailers it was the “Market of Many”, but with online retailers, it is effectively a “Market of One”, with online retailers having the ability of customizing prices for individuals without others knowing of it. Even academic research has proven that Amazon is capable of this, and for all you know, their algorithms are already doing so.
The #BuyAndTellPrice Movement
Let us quickly get a background to this whole movement called #BuyAndTellPrice that I start here.
Buying from online retailers such as Amazon/Flipkart has become a way of life for most of us. Gone are the days of us going to B&M stores, evaluate/try products, and use our wisdom alone for our buying decisions? When buying a product online (say on Amazon or any website for that matter), our decision is based on the number of positive customer reviews, product ratings, number of likes etc. provided by strangers. It is not just the convenience of buying products online that has shifted the trend (from offline-to-online), but the ratings and feedback (both on the vendor and the product side) given by good Samaritans (unknown to us), that has led to this transition.
Now we have reached a stage where B&M stores are almost dead, and there comes the possibility of individual price discrimination by online retailers. This is also called the first degree price discrimination in economics. Due to the sheer nature of their business, the platform retailers have access to all our online activities like surfing, buying and selling that leaves a digital trail. They can identify and track individual consumers, not just on their website but across different websites that helps them create individual consumer profiles and offer personalized offerings. Amazon knows you to the extent that it can price a product perfectly to the price that you are willing to pay, exploiting the information asymmetry. The concept of personalized services was always understood for social welfare such as personalized medicine. But, in this world of data and machine learning, personalization has reached new heights. This new age personalization entails using our data against us for opportunistic pricing tactics.
We are possibly getting exploited! And it is time to band together and equip us all with the same level of information that Amazon has.
So let us start a movement #BuyAndTellPrice
Many of us take out the time to rate a product on Amazon. Implicit in our rating process is the value for money aspect. But when we do rate, we provide the star rating but do not state the purchase price, which frankly is the key determiner for the rating. For instance, I gave a 3.5 star rating to a Bose Bluetooth headphones bought at Rs. 12,000, while a Qy7 which I purchased for Rs 900, was 4 star for the price. In absolute terms Bose was far superior, but it was the value for money aspect which led to a 4 star rating for the Chinese knockoff, QY5 headphones J.
Most our purchases these days are when there is a sale on, and looks like there is a sale throughout the year. So how do we know we got the best price? Only by knowing what was the discount offered to other people who purchased earlier.
So if you have taken effort for rating a product, why not also write the price paid in the feedback section. This way, we leave a trail of prices at which any product was sold that will help others know if they are really getting a deal. Let us take away the power of individual price discrimination from Amazon/and all other online retailers and give it back to the society. Let us #BuyAndTellPrice, each time we purchase a product- not just rate the product but also write the price of at which we bought it. Let’s resolve to #BuyAndTellPrice.
A snapshot #BuyAndTellPrice for a few products that I purchased on Amazon recently.