Schlagwort-Archive: pricing

How Amazon Tricks You Into Thinking It Always Has the Lowest Prices


Amazon is known for having low prices. But a study conducted by a startup called Boomerang Commerce reveals that Amazon’s pricing strategy is much more nuanced than simply undercutting the competition.

Boomerang, founded by Amazon veteran Guru Hariharan, makes software that tracks prices on shopping sites that compete with its clients, then recommends price changes dynamically. Those changes are based on rules its clients set about which products to match prices on and which to boost higher or drop lower than a competitor’s to boost profits or sales, respectively.

The study of Amazon’s pricing uncovered some interesting tactics. First, Amazon doesn’t have the lowest prices across the board, which may not surprise industry insiders but might surprise Amazon shoppers.

Instead, according to Boomerang’s analysis, Amazon identifies the most popular products on its site and consistently prices them under the competition. In one example, Boomerang observed Amazon testing price reductions on a $350 Samsung TV — one of the most popular TVs on Amazon — over the six months leading up to Black Friday. Then, on Black Friday, it dropped the price to $250, coming in well below competitors’ prices.

But when it comes to the HD cables that customers often buy with a new TV, Amazon actually pushed up the price by 33 percent ahead of the holidays. One reason is that the cables weren’t among the most popular in their category, meaning that they have little impact on price perception among shoppers. Secondly, Amazon most likely figures (or knows) it can make a profit on these cables because customers won’t price-compare on them as carefully as they would on more expensive products.

In another example, Amazon priced one of the most popular routers on its site about 20 percent below Walmart’s price. But when it came to a much less popular router, Amazon priced it almost 30 percent higher than Walmart did. Again, Amazon knows which products will drive price perception among shoppers.

“Amazon may not actually be the lowest-priced seller of a particular product in any given season,” the report reads, “but its consistently low prices on the highest-viewed and best-selling items drive a perception among consumers that Amazon has the best prices overall — even better than Walmart.”

The study was part of a white paper Boomerang released on Tuesday to bring attention to the idea of price perception in e-commerce. The startup has created a “price perception index,” which it described as “a numerical pricing model that captures customer psychology of price perception. It does so by providing a tangible statistic of how a company’s products … are priced, relative to the competition, weighted by customer interest.”

The goal of the index is to highlight how a nuanced approach to pricing — such as Amazon’s — can be a smarter, more cost-effective option over simply price-matching across the board. This is where Boomerang enters the conversation: The startup wants to help Amazon competitors think about pricing in as sophisticated a way as Amazon does.

“Amazon is doing it at scale, with what is estimated to be 10 billion pricing changes across the holidays,” CEO Hariharan said. “Some retailers are doing it every three months.”


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Audi RS7 Is as Fast as a Ferrari 458 at Half the Price

Wrong world America?

Whereas Europeans in well saturated markets like Germany and Austria pay easily more than double the price Americas customers pay for the same brands like Tommy Hilfiger, Audi, Ferrari only a friction.
Wrong world? Globalisation?
Wrong. The answer is. International brands try to globally subsidise their Americas Sales in order to keep the motor running and Americas Washing machine spinning.

Ferrari 358: America: 230.000 USD, Germany Austria: 390.000 USD (+70 %)
Hilfiger Watch: America 10 USD, Germany Austria 75 USD (+750 %)
Michael Kors Sunglasses: America 44 USD, Germany Austria 150 USD (+340 %)
Audi RS7: America super pricey 122.000 USD, Germany Austria: 182.000 USD (+50 %)


The new Audi RS7 is a conflicted car. It’s a five-door hatchback that can run neck and neck with a Ferrari 458 in the quarter mile. It marries straight-line performance with unexpected utility, and does it at a price that undercuts its similarly power-mad German competitors. Yet it’s not the vehicle you want to take to the track—the power overwhelms, and the Audi S7 is the better choice if you actually want to turn at high speeds.

But, good grief is this thing fast! Full throttle, the RS7 is 4,500 pounds of luxury hurtling forward like anti-aircraft fire. Say another nouveau-riche fellow pulls up next to you at a stoplight in his 458. Fear not. You’ll match him right through a quarter-mile drag race. As the two of you speed forward to 60 mph in around three seconds, he can ponder the fact that his $233,000 (at least) two-seat sports car is holding even with a ride that holds four people and their luggage comfortably.

With the RS7, Audi tips further away from its characteristic tight-lipped restraint than with any other car it makes, including the R8 V10 Plus.

America’s Most Powerful Audi

Based on Audi’s A7 Sportback, the RS7 is the company’s top dog performance sedan, a notch above the S8 in dynamics if not price. It starts for $104,900, we tested one worth $122,545. It’s the most powerful Audi ever offered in the United States, boasting a 4.0 liter twin turbo V8 that makes 560 horsepower and 516 pound-feet of torque. The engine makes so much power that the regular A7’s 7-speed double-clutch transmission can’t handle the torque.

Instead, the RS7 gets an 8-speed ZF single clutch transmission that sends power to all four wheels via the Quattro AWD system. The resulting 11.5 second quarter mile dash is Gran Turismo easy – just plant your foot, no drama.

Driving the car, these giggle-inducing numbers feel like lowball estimates. After sprinting off the line, the RS7 pulls like a rocket sled to an electronically limited 174 mph (an optional “Dynamic” package bumps top speed to the same 189 mph ceiling you get in the European version of the car).

Audi RS 7 Sportback

A Practical Ride

Yet it’s still a practical car. There really are four habitable seats, though your head will be bowed in the back if you’re over 5’10”. The space available easily exceeds what you get in competitors like Mercedes’ CLS63 AMG, Aston Martin’s Rapide, and BMW’s M6 Gran Coupe. The rear hatch and folding rear seats yield 49.1 cubic feet of cargo space, more than a BMW X1 crossover.

The interior nods to fun, spiced up with aluminum pinstriping across black wood dash and door inlays, web stitching on the excellent seats, a perforated steering wheel wrap, and machined-out aluminum door handles. On startup, little Bang & Olufsen tweeters—ostensibly there to improve acoustics, really made for impressing friends and dates—rise from the dash in sync with the 7-inch MMI display screen.

The exterior signals aggression with 21-inch wheels enclosing 15”/14” wave-design rotors and a huge black gloss grille. Our Misano red pearl test driver had matte aluminum trim and a pattern based on the Audi quattro ring in the tail lamps. The effect is handsome, but borders on vulgar in bright red.

There are other bits of awkwardness. Small aluminum steering wheel shifter paddles indicate Audi doesn’t think you’ll paddle shift much (it’s probably right). The brake ducts on the front splitter are cosmetic only and the plastic cover over the engine keeps you from ogling the fabulous twin-turbo V8. Too bad, because beneath it you find the turbos mounted atop the intake manifold. The layout largely eliminates turbo lag, but Audi doesn’t say how it keeps the turbos cool.

The RS7 doesn’t drive perfectly. It corners and stops very well, until you push the power close to the limit. The chassis is marvelously stiff but the power out-muscles the suspension. The rear sport (electronic) differential over-speeds the outside rear wheels in hard cornering but it cannot defeat the inevitable AWD understeer. Nor can it make up for the RS7’s mass. Steering feel is vague and the air suspension doesn’t communicate what’s happening underneath.

What all that means is that when you barrel into a corner 40 mph quicker than you expected (likely at first) the car lurches, struggling mightily with front-end plow as you add more and more steering. The well heeled toffs who can afford an RS7 may not instinctively understand this.

For all its gobsmacking power, the RS7 really isn’t an emotional car in driving terms. On long highway drives, it’s nice to be isolated from noise and vibrations, but it takes something away when you want to really feel the car. Fortunately for Audi, the competition isn’t much more involving.

But at least it’s the dominant sort of isolation, the kind that allows you to look through dark sunglasses at the sucker next to you and rev the engine with confidence.