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Thursday, December 15, 2011

Amazon Faces Backlash Over Price Check Offer

If Amazon wasn’t already at war with brick and mortar stores, it may now be.

Amazon made a special offer for last Saturday to customers with mobile phones: Go to a brick and mortar shop, use Amazon’s Price Check app to scan products and give that information to Amazon to get 5 percent off three items scanned in stores.

The offer angered small businesses, who say it turned their stores into show rooms for Amazon. Maine Senator Olympia Snow called it “anti-competitive” and “an attack on Main Street businesses that employ workers in our communities.”

The Harvard Book Store in Cambridge, Massachusetts now has a sign, “If you see it here, buy it here, keep us here.” They’ve also created a video drama, with the message for customers not to be “an iPhoney.”

http://www.youtube.com/watch?feature=player_embedded&v=xTklTJprnTA

Amazon defends its practices and the price comparison app, saying it helps consumers. But writer Richard Russo says Amazon is guilty of “jungle logic.”

“This is just a new phase in terms of Amazon’s predatory impulses,” Russo told Here & Now‘s Robin Young.

Amazon And Sales Tax

Many local businesses argue that Amazon is able to offer such low prices because it doesn’t have to charge state sales tax in most cases, unless customers are shipping merchandise to states where Amazon has a physical presence.

There is currently a bill in Congress that would give states the option to collect sales tax from out-of-state businesses rather than rely on customers to voluntarily pay the tax.

“I have a feeling that a lot of this is going to end up in the courts,” Russo said.

“It’s this idea that you can save two bucks by buying something online, but the savings aren’t real. If you don’t buy locally, then you erode the tax base. If you do buy locally, you’re funding your local schools, filling local potholes.”

The Case Against Local Bookstores

Fellow writer Dennis Lehane calls Amazon’s price check app “scorched-earth capitalism.”

But writing in Slate, Farhad Manjoo disagrees with Russo, saying that buying books on Amazon is better for authors and the economy.

“No company in recent years has done more than Amazon to ignite a national passion for buying, reading, and even writing new books,” he writes. Manjoo says that local bookstores, which he refers to as “cultish, moldering institutions,” are economically inefficient, they don’t have customer reviews, good selection or a reliable way of finding what you’re looking for.

To which writer Judy Berman responds on the culture website FlavorWire:

“I find it sad, actually, that Manjoo … finds clicking around on Amazon to be more fun than browsing the shelves of a real-life bookstore where (gasp!) one might actually interact with other book lovers.”

Where do you buy books? Do you value local book stores and if so, why?


Clarification about our radio interview with Richard Russo: Russo says that patrons at Ann Patchett’s bookstore in Tennessee are not prohibited from making lists of books they want to buy online, they are merely discouraged from doing so. Russo writes that Patchett and her staff do not stop people from making a list while in the store, they just explain why they feel it hurts their business and the community.

Guest:

  • Richard Russo, novelist and screenwriter

Please follow our community rules when engaging in comment discussion on this site.
  • Another perspective

    Listening to this story right now – just wanted to make the point that the reason I use, and LOVE, Amazon is that it makes shopping easy. I have two young kids and going to bookstores ain’t that easy. Also I don’t like having to schelp across town and through traffic in a car. I’m happy to pay taxes if that’s a real argument against Amazon (how hard can it be to apply taxes to where the billing address is located?)

  • http://twitter.com/mem_somerville mem_somerville

    I like to use my local stores, knowing fully that I might pay more. I do support them because they will go away if I don’t.

    That said, I don’t understand the drama around this. How is it different from surfing and learning some pricing, and then visiting the store to see theirs? Do we have to stop printing pricing or something?

    I’m finding it funny that the information-is-free crowd is just now realizing that there are consequences to that.

    • reuben dermyer

      I think the difference is looking up what you want before you go versus not knowing what you want, having the employees help you, and then leaving to buy online.

  • comparison shopper

    This is no different than comparison shopping by going from one store to another. Textbooks especially are a racket that force students to purchase new editions that are barely changed from the previous edition.

  • Anonymous

    I haven’t used the Amazon app… but I love the concept.  Especially where Amazon.com hosts product reviews online that are generally very good and no physical store can or does offer access to instant reviews in their store.  I doubt I would buy products by way of this app, but I would want to read product reviews and if the app would get me to them quicker, then I say Amen to that!  Of course they don’t offer an app for my phone so screw them!
     
    And to your poor guest…  I buy a lot of books from Amazon…  USED.  I can’t ever remember buying  a brand new book from them and I almost never buy new books at a store.  Though I am not a staunch environmentalist, I hate killing trees and I don’t ever need a brand new book.  I simply do not value books so much that I am going to pay any more than I absolutely have to in order to get what I want.  I’m sure your guest would want to choke me for saying that but it’s the truth.

  • http://www.lesliebrunetta.com Leslie Brunetta

    Here’s the pro-bricks-and-mortar view from a local writer (me):
    http://portersquarebooksblog.blogspot.com/2011/07/buying-in.html

  • Jemimadiva

    I love the sight, the scent, the feel of a real book;  the excitement and mystery of not knowing what will call to me until it does, but being sure that when it does it will take me to a new place and time, share with me someone else’s life.  I ALWAYS  get that from a library or a real bookstore.  I’ve NEVER experienced it on the web.  EVER.

  • J Frog

    Interesting new Amazon initiative….

    http://studios.amazon.com/

    ….or new to me because I had never heard about it until the other day.  Gotta hand it to Amazon, they certainly are thinking out of the box.

  • Anonymous

    where were  you when the Buggy Whip makers were going out of business?
    the world changes
    next thing you’ll want to ban e-readers because book binders are going out of business

    • http://www.facebook.com/profile.php?id=1580073413 Katherine Westfall Thomas

      You are missing the point of how online shopping erodes local economies as a whole.  So buggy whips are no longer a need but what about air filters? Buy it in town at an independent and 68% of that stay s in your community, buy it at a big box 36%, buy it online, ZERO. There is a bigger picture.

      • Marc Lamphier

        This argument never quite added up to me. Buy it online at a cheaper price and that price difference also stays in the local economy. More fundamentally, buy local only works if your town is the only one doing it. If  other towns are also buying local, that means they won’t buy from you either. Kind of just depends if your local economy is all small retail (which is a weak basis for an economy) or if you are making things that are purchased by others — perhaps even purchased by others online.

    • Jasoturner

      You can buy a nice buggy whip at Amazon.  Though I believe they are more formally known as carriage whips.

  • Vsherida

    You can price match at wal-mart and many other stores. Why is it different then Amazon offering price matching?

  • Confused

    I have always tried to do my price comparisons online and find out which store has the best price, then go and buy locally.  I ran into a problem yesterday while searching for a PC projector. I did my research and found exactly what I wanted at an exceptional price online. I then proceeded to go to Office Depot to make my purchase only to discover that the same item offered through Office Depot online was $100 more if I purchased it in their store.  The clerk told me to get the reduced price, I would have to order it online.  There was no option of making the purchase online and picking up at the store and they were offering free next day delivery.  It seems as though they are in competition with themselves.

  • http://www.facebook.com/profile.php?id=1580073413 Katherine Westfall Thomas

    Why not use Amazon to read reviews then go to your local bookstore and make your purchase?

  • Michael

    I try to support our local businesses whenever possible, but sometimes the buying power of the big online sellers makes their prices too attractive to ignore.  I can live with $18.99 for a book downtown vs. $16.99 for a book online, but the price difference on larger purchases is harder to swallow.  For instance, the tires for my car cost about $100 less shipped to my door from out of state than they do when purchased locally.  That’s real money when you live on a budget. 

  • Blake Still

    Amazon is a GIANT. As complicated as the tax laws are, there needs to be a tax rule in place for all fairness to “brick & mortar stores”! 

  • Anonymous

    This is not a binary decision.   I love and frequent my local bookstore and have made many purchases there (shout out to Tatnuck in Westborough, MA!) but sometimes, like the holidays, it is simply too expensive to buy hardcover books near or at full price when Amazon offers a significant discount. 

    I guess we all have to consciously think about the value of local stores in maintaining a sense of community, and then decide if our budget allows us to help maintain that community at the expense of the few bucks that might be saved from ordering on line.

  • Catherine Shaw

    Amazon’s unwillingness to collect the sales tax for
    the State of California
    hurts us all. California,
    the 10th largest economy in the world, must prosper if we want our nation to
    recover and thrive in this recession. Like so many states, California is reeling under mountains of
    crushing debt. Public education, highways, state parks, public health… and thousands of
    workers depend upon the money generated through the sales tax; a sales tax that
    is paid for, not by Amazon.com but by the consumer. Further, many of California’s municipal,
    county and special districts rely upon revenues generated through the sales
    tax. Add to this the advantage that Amazon already enjoys over brick and mortar
    businesses and one must marvel and the greed of this corporation. If we
    consumers can bring NetFlix to its knees we can do the same with Amazon.

    While California
    voters go to the polls to decide this issue, let’s give Amazon.com some
    incentive to do the right thing: Take your holiday dollars and buy directly
    from businesses.

    Catherine Shaw, Ashland, Oregon

     

  • Hopefire22

    I was chuckling the entire time I heard this story.  The only time I go to the Amazon website is to read reviews or search for a good book.  Then I go to my local bookstore to order it.

  • Docentjoel

    Bingo.  So I listened to the story yesterday.  Two points.  1) I used the Internet recently to research options for my son’s Santa ask on video games.  I determined the best choice from multiple web sites, then purchased from a brick and mortar.  2) If I am in the mood for a new book on a specific topic, I use Amazon to browse choices and review the reviews.  Then I go to my local library website to reserve the best choices.  Turnabout is fair play.

  • brucejquiller

    Booksellers ought not tolerate people treating heir stores as showrooms for Amazon.

    http://brucejquiller.wordpress.com/2011/03/01/newspapers-boo…ores-and-bezos/

  • Anonymous

    “Amazon is not so Amaz-ing. Small businesses are
    important to us #occupyamazon #10bucksoff”. 

  • http://seodamian.wordpress.com/ Damian

    I was looking for a book before heading to B&N (only option in Chicago area within 40 min.) for a couple of books. They promised one price, drove over to the store only to find out that was only the online price, store price was $9 more plus tax, on  a$16 book that is quite a premium. Especially since they did not have the other book I wanted, so I still needed to order online (from B&N or other vendors). Short of it is, booksellers have already cut their instore inventory sku count and adjusted prices to continue to drive us online. 

      AddAll dot com  provides best comparison pricing I have seen. 

    So how different is it if our only option for brick and mortar within miles of Chicago suburbs is a large corporation or an online large corporation?

  • Gena

    I own a “small busines” (4,000 sq ft).  It’s a craft store.I cannot tell you the number of times that a customer has come in and asked for help and then actually asked, “Do you think that Michael’s sells that?” You are standing in my store, getting advice from me, and you PLAN to buy it elsewhere?? I have had customers ask if we have something in stock and I say, “No, but I can order it and it will be here in about a week” and they reply, “Nevermind, I’ll buy it online”.Or, they will have bought something at Costco or Michael’s and they can’t figure it out and no one at those two stores can help them, so they come into my store and ask for (free) help and also don’t buy anything else.

    It’s VERY frustrating!
    I *LOVE* the “Find it here, buy it here, keep us here” idea!!! We feel the same way!

  • jP

    I would argue that Amazon’s price check technology amounts to a form of theft. Amazon is not paying the brick and mortar stores’ rent, or the employees who work in those stores’ wages. It side steps local sales tax… Yet those stores are essentially unwittingly providing a service to Amazon. Manjoo’s argument that Amazon is better for the economy is too simplistic to possibly be true. On one hand, as the consumer, I may be able to save a few bucks at a time, maybe several, by ordering from Amazon. Yet, scale this up to several thousand people or more following the same behavior as consumers, and what you are left with are less jobs, lowered wages, and closing bookstores. The result being not only a less vibrant economy, but potentially something more insidious: the control of imformation. Whether intended or not, this dynamic will eventually contribute to the decay of our already eroding democracy. I do not and will not support Amazon to save a few bucks.

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