The e-commerce pioneer is constantly trying new ways to tempt us to
buy more online.
A few weeks ago I wrote about some of the interesting experiments
that Google is conducting as it tries to find new ways to exploit
its vast holdings. In this respect it is following in the footsteps
of the e-commerce pioneer, Amazon.com.
Very early on, Amazon recognised that it could not simply sell
books cheaply over the Internet, since anyone else could do
precisely the same thing, leading to a price war that no one could
win. Its response to this threat was twofold.
On the one hand, it tried to build on and consolidate the
Amazon.com brand by expanding the range of items it sold. Here,
Amazon seems to have over-reached itself: it expanded too fast into
too many areas, and ended up with enormous cumulative start-up
losses.
The second strand of its strategy has been much more successful.
This has involved inventive schemes to create an increasingly rich
Amazon.com culture around the business of online selling.
For example, alongside obvious devices such as combination
purchases and featured products, Amazon hit on the idea of
suggesting further items of interest on the basis of other
customers' buying patterns.
This idea has been so successful - and emulated - that we tend to
take it for granted, but Amazon deserves credit for homing in on
one of the key benefits of e-commerce: the ability to analyse and
exploit large-scale buying patterns.
Similarly, another Amazon feature that most of us barely notice is
customer reviews.
This kind of direct feedback has become a classic feature of online
commerce, but it was Amazon that developed the idea to the point
where its customer reviews are some of the most useful and
entertaining parts of its site.
Nor has the company finished experimenting in this area. Recently,
Amazon introduced a What's Your Advice feature that solicited
users' suggestions for alternatives or additions to the purchase
under consideration. Unfortunately, Amazon had to pull this scheme
in its original form because it found that "commercial abuse" was
starting to creep in.
Other novel ideas that it is currently trying out include
restaurant menus and various mail order catalogues, for
example for
industrial supplies. Catalogues can be viewed online or
ordered by telephone. Since this is a free service for the
catalogue companies, Amazon is presumably using this to enrich its
culture generally. But another area where it has been experimenting
promises to help its bottom line too.
This involves the sale of used goods. There are two main kinds,
fixed-price and
auction
sales. Fixed-price used goods have been integrated into the
main selling pages through
Amazon's
marketplace for some time. It is possible that Amazon may
extend this feature to allow used goods to be sold even if it does
not offer them new - the current restriction. This would bring
Amazon into greater competition with its arch rival in the
e-commerce sphere,
eBay ,
notably through eBay's fixed-price subsidiary
Half.com.
The big problem with the fixed-price sales of Amazon's Marketplace
is that they lack the excitement of the auction process. It is
partly this adrenaline buzz, which many people seem to derive from
auctions, that makes eBay so successful. Undeterred, Amazon has
come up with a new idea that it hopes may tap into the same
psychology.
Called a
"Gold Box", this is a series of five special offers that
are available each day. Once you have seen the offer, you must
decide within 60 minutes whether to buy or pass on to the next.
There are extra discounts to tempt you into the fateful click,
though so far I have found the array of ear hair clippers and
bread-making machines on offer eminently resistible.