Internet Retailer Price Points – Internet Marketing Research Paper (300 Level Course)

A study was conducted by the Annenberg Public Policy Center of the University of Pennsylvania; found that 87% of people strongly objected to internet retailers charging different consumers different prices based on information collected by the retailer about the consumers shopping habits. The internet allows consumers to price check and find the lowest price for the item they want to purchase. It also allows retailers to gather information about a consumers shopping habits and preferences and set prices for that consumer accordingly.

An example of this was found on a retail photography site that charged different prices to different consumers based on whether or not the consumer had visited a price comparison site or not.

If the consumer had been to a price comparison shop the web site offered lower prices. Amazon was caught doing this in September of 2000 when a consumer deleted their coding information off his computer and was then charged a higher price for an item. Amazon claimed it was a random price test and offered to refund customers who paid the higher prices. The price fixing by internet retailers is not well known to many internet consumers.

The question the article raises is what consumers are going to do with the information that they are being tracked by internet retailers and possible charged different prices based on their shopping preferences.

CNN. 1 June 2005. Washington (AP). 1 June 2005