Amazon is rolling out a new feature in which shoppers can make offers on a selected set of products sold through its site. Called “Make an Offer,” at first shoppers will mostly only be able to make offers on collectables and art. At face value, that seems like a good idea. It is not uncommon for shoppers to haggle with shop owners on the value of items in a store, so why not try to duplicate it online? After all, this online haggling will be done privately via email.
To be fair, this is a pretty good idea – for this small group of goods. However, what happens if shoppers start demanding it open this up to more categories? Does Amazon try this in clothing, electronics or toys?
Does this become a slippery slope of sorts in which Amazon becomes half eBay and half online marketplace? Further, do commercial retailers who sell on on the site want this to happen? Or does Amazon think that it doesn’t matter. Does it think that it is so much of a retailing behemoth that retailers have to sell on Amazon regardless of how much margin is squeezed? Walmart has succeeded with this approach, but its target customer is quite different than Amazon’s.
Regardless of how big Amazon thinks it is, it is still beholden to two customers, the retailer and the shopper. In today’s marketplace, shopping online is easy and there are always other outlets from both the retailer and shopper’s perspective. It must be careful how it utilizes this feature in order to give customers what they want (a deal) and what retailers need (margin).