Should you be able to charge higher prices on the different channels on which you sell? And if it costs you more to sell on some platforms than others, should you be able to charge higher prices than on less costly platforms?
A seller raised the long-debated issue on the Amazon seller Announcement Board last week. They said that despite higher costs of selling through Amazon - including higher return rates - Amazon didn't let them charge higher prices than through other platforms.
Ironically, it appears Amazon itself allows a two-tiered pricing strategy on its own platform.
The seller was responding to a post by Amazon encouraging sellers to explore offering a "business price" that "could be lower than your standard consumer price or include a quantity discount."
"Business customers tend to buy more and return less products, and in return they expect lower prices,"
Amazon stated in its announcement post.
The seller replied in part, "This would seem to be an admission that Amazon retail customers return more product, and as a result, our prices should be higher. Yet, we can't price higher on the platform,..."
Legislators have waded into the debate for years, and in 2019, Amazon eliminated its controversial "price parity" clause in its terms of use - but some say the marketplace uses other ways to ensure sellers don't offer lower prices on other channels. Last month, California's
Attorney General filed a lawsuit alleging that Amazon stifled competition and caused increased prices through "anticompetitive contracting practices."
The Attorney General claimed Amazon uses its market power to raise its fees to sellers but prohibits them from offering lower prices on lower-fee platforms.
Amazon responded to the lawsuit writing in a statement:
"Sellers in Amazon's store set their own prices for the products they offer. Amazon makes no effort to prevent them from offering lower prices elsewhere. But Amazon knows customers expect to find low, competitive prices in the Amazon store. Amazon, like any store, reserves the right not to highlight prices that are uncompetitive compared to other major retailers. When sellers set prices that are uncompetitive compared to these retailers, those offerings are still available to customers in Amazon's store, but Amazon does not highlight them."
Is Amazon a costlier platform on which to sell? And should you be able to offer your items for sale at different price points depending on the channel you sell?