Does it really matter if Amazon eliminates list prices?
There have been several recent articles focused on the death of list pricing and/or on how list pricing is so deceptive that it’s useless anyway. Here is my take…
1 – This sounds like an overreaction to lawsuits where sellers are manufacturing list pricing that is specifically intended to allow for discounting so the offers look like a great deal. Who would not agree that sellers need to be both ethical and follow the law…? The best reaction to legal action may not be the complete elimination of the practice in question.
2 – No company can eliminate list prices. What is really being proposed is moving to every day value pricing – perhaps with some elements of optimized or dynamic pricing included so that the price offered is based on competitive market forces or other relevant data attributes. Maybe I’m being unfair, but this sounds like what JC Penny did several years ago now, with truly terrible results. Not sure Amazon wants to head down this path.
3 – Discounting is actually a powerful tool for the pricing, sales, and marketing team when used correctly. Discounting can and does help a company to dispose of larger than required inventories, out of date inventory, and can accomplish short-term sales gains. There are many, many good reasons to use discounting so long as you’re not relying on it as your sole sales strategy and not creating long-term damage. Don’t remove discounting as a pricing tool; just improve the strategic use of this tool.
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