If you are an Internet retailer, you need to be very concerned about a new sales tactic that Amazon is currently testing out. Instead of simply purchasing an item for a cost the retailer chooses, a potential customer can now essentially bid, or make an offer, for the product instead.
While this is great for potential customers, for retailers are already struggling against sites like Amazon, this makes it even more difficult to compete because not only are they trying to beat prices that Amazon is listing, but now they also have to take in consideration that people can lowball those prices too.
Right now, Amazon is currently testing this feature on approximately 150,000 items, primarily collectors items such as sports memorabilia, collectors coins and fine art. It’s completely optional by the seller and is something that must be enabled within the seller. Sellers can either accept or decline the offer.
Amazon also plans to expand this to “hundreds of thousands of items”, which means even those retailers that are outside of the market areas of the test could quickly find themselves under pressure as Amazon expanses program.
This change to the way Amazon is selling products also makes it seem a bit more like eBay, albeit with an Amazon twist. And it is definitely and something that will attract the bargain shoppers. They are definitely trying to steer users to buying it now however as when you view the original page you see the buy it at the current price option, and you have to click a radio button in order to see the make an offer box pop-up.
Here is what a make an offer page looks like after clicking the make an offer button.
And here’s what it looks like when you first view the product page on Amazon
Amazon currently has an entire section marketed as “Make an Offer” so that shoppers can find the types of products they can currently make offers on. The vast majority of the items seem to be higher ticket items, many over the $1000 price range while some exceed $100,000. There doesn’t seem to be any restrictions on the minimum price you can offer on item.
How will this impact Internet retailers? If Amazon moves into less collectible areas, where many items are one-of-a-kind are very limited, it could have us definite impact. And even if a retailer offers a lower price and Amazon, those who utilize Amazon prime or just prefer the security of Amazon could just simply make an offer to the same price as the non-Amazon retailer, simply to make it easier. It could definitely have a huge impact on retail websites.
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Ethan Glover says
The reason businesses struggle against Amazon is because they’re so good and making the customer happy. This is, of course, a net positive. For those who feel overwhelmed by it, I’d only suggest trying it out yourself now before Amazon makes it bigger. Small business have the benefit of being able to move more quickly than a large company like Amazon.