1197 Rockefeller’s Trick
Maybe he didn’t invent the idea, but John D. Rockefeller showed us the way to kill the competition.
His Standard Oil Company would sell its crude cheaper than anyone else, willingly taking losses even early on when they couldn’t afford to.
After awhile, the competition went broke and went away.
The biggest of the big box stores operate a modified version of the game. Wal-Mart, Lowe’s and Home Depots aren’t quite as direct as Rockefeller, but their squeeze-’em pricing has emptied many an American downtown. Try to find a real hardware store anywhere. Sure they exist. But not in great numbers.
The latest merchant to climb aboard this train is Amazon.com. Admit it; you have a personal relationship with this faceless online giant. You feel it serves you personally, just like they used to at Bob’s Books down the corner.
People who use the Amazon website think of it as someone who knows them well (it does) and who can anticipate their needs (it can) and who likes them; welcomes them.
Amazon is more than just another shopping site, it’s a gathering place where people exchange views, freely express unpopular opinions or support popular ones.
Touchy-feely 21st Centurions as they play on the web, Amazon has started using a decidedly 19th century approach to its few remaining competitors.
As the New York Times reported the other day, Amazon is raising prices and diminishing the discounts that put it on the map.
They’re not doing it in a big way. Not yet. But discounts on best sellers often shrink before your very eyes. And some cases, according to the report, there are no discounts at all.
Amazon owns the e-reader market. No one else even comes close. So it has complete control over the price of much of the content.
And it’s getting so that it is dominating the physical book trade, too.
The cited report says there’s no way to track the price changes with the same certainty you can track temperature readings or how much fuel you use for heating. It’s wrong. There is. But you have to fight computers with computers and somewhere, there’s someone writing a program that will give you Bloomberg Terminal-style fluctuation reports in real time.
Shrapnel:
--That price cutting trick doesn’t work for blogs. No matter how free this one is, it’s not gaining the kind of circulation you’d expect. But over time, we have crept into the top five million for reader attention.
--With the menus spread open before us, the waiter asked if we had any questions. Yes, we do... like “which side should we be on in the Egypt conflict?” “where is Eddie Looselips?” and “why are hummingbirds so small?” Probably, though, she meant questions about the food.
--Little stirs the anger of the word police like finding “waiter” applied to a restaurant worker who is female, as in the above shrapnel entry. But calling her “waitress” is old fashioned and possibly sexist. And calling anyone server is demeaning.
I’m Wes Richards. My opinions are my own but you’re welcome to them. ®
© WJR 2013
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