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Amazon App Turns Consumers into Price Spies

  |  December 6, 2011   |  Comments

What's good for shoppers is better for Amazon, as mobile shopping gains steam.

amazon-price-checkAs mobile devices play a larger role in shopping this holiday season, Amazon is turning consumers into its private band of secret shoppers.

According to IBM, on Cyber Monday, 10.8 percent of people used a mobile device to visit a retailer's site, up from 3.9 percent in 2010. Additionally, mobile sales grew dramatically, reaching 6.6 percent on Cyber Monday versus 2.3 percent in 2010.

And yesterday, comScore reported that 38 percent of smartphone owners have used their phone to make a purchase at least once in the course of their device ownership.

Mobile devices are not only an alternative to ecommerce on the PC; they're increasingly encouraging shoppers to use physical stores as showrooms for products they will ultimately buy online.

Amazon is pushing hard to get people to use its Price Check App. On December 10, it's offering them up to $5 off the Amazon price on up to three items in popular gift categories.

Not only does the Price Check App encourage shoppers to buy from Amazon instead of the retailer, it also gives Amazon real-time competitive intelligence. When they use the app, shoppers can choose to submit the in-store price to Amazon. In its press release, the ecommerce giant positions this as a public service, saying it's " allowing all Amazon customers to get the lowest prices year-round."

What's good for shoppers is better for Amazon and its increasing dominance of nearly every sector of ecommerce. ChannelAdvisor, an ecommerce platform that translates and distributes retailers' product feeds to hundreds of online channels including Amazon, reports that over the Thanksgiving weekend, including Black Friday, total ecommerce sales among its clients started with 17 percent growth on Thanksgiving Day, followed by 20 percent growth on Black Friday, 21 percent growth on Saturday and 27 growth on Sunday.

ChannelAdvisor clients' sales on Amazon far outstripped this growth, increasing by 30 percent on Thanksgiving Day, 50 percent on Black Friday, 49 percent on Saturday, and 59 percent on Sunday. By contrast, clients' eBay sales remained steady all weekend with approximately 15 percent growth, while their paid search sales increased by 19 percent on Thanksgiving Day, 22 percent on Black Friday, 27 percent on Saturday, and 34 percent on Sunday.

Using the Amazon Price check app, shoppers can scan a barcode, snap a photo of an item, say the product name or type in a search term to find products and prices. If they enable the geo-location feature, they'll be offered an additional 5 percent discount, worth up to $5 off Amazon's price, if they buy it from Amazon next Saturday, Dec 10 -- instead of from the store they're standing in.

Doron Simovitch, co-founder and CEO of SortPrice, a shopping search service for Facebook stores, says companies like his also aggregate price information and make it available to merchants. He sees a potential problem with Amazon's limiting its discount to December 10.

"People may not want to wait until that day just to have the chance to save a few bucks," Simovitch says. "Impulse buyers who come across an item in a brick and mortar shop may ultimately decide that they want that product right then and there, regardless of what they might save by participating."

In fact, JiWire, a location-based mobile media company, today released a study which found that, while only 22 percent of consumers prefer to shop in a physical store, 66 percent prefer shopping for a $50 dollar item at a store they visit regularly if within they're within five miles of it.

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ABOUT THE AUTHOR

Susan Kuchinskas

Susan Kuchinskas has covered interactive advertising since its invention. The former staff writer for Adweek, Business 2.0, and M-Business covers technology, business and culture from Berkeley, CA.

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