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Amazon used to be happy to price match themselves within a month or so of a purchase, or do things like let keep a cheap item you wanted to return. My guess is

Amazon used to be happy to price match themselves within a month or so of a purchase, or do things like let keep a cheap item you wanted to return. My guess is that they did some A/B testing and found that the "irrational" behavior actually saves them money. In your example, if 50% of people don't bother going through the return process they still come out ahead.

kube-system 4y ago
I bet this is actually it. I totally would ask for a price difference refund for a few bucks. But I’m not bothering with a return/repurchase for a couple dollars.
wikfwikf 4y ago
My guess is that they also might do market segmentation analysis to understand what type of customer you are, and this affects the return policy. For example, you consistently buy small ticket household items and rarely return anything: when you do return something they will be helpful and generous to keep you happy. You buy large amounts of fairly expensive clothes and shoes but return around 50% after trying on. They will accept the returns without issues but won't let you keep anything. You're a bargain hunter who buys expensive laptops or hard drives whenever the discounts look really good. They will make returning stuff a little harder for you since they know you don't have loyalty, and they don't want to facilitate arbitrage. Doing this is computationally no more sophisticated than the work they are already doing to detect professional scammers. They aren't supposed to show different customers different prices, but they can freely use things like this to do stealth price differentiation, since many details of how the return policy is implemented are at their discretion.
- hotpotamus 4y ago
  Somewhat famously, Best Buy did this and differentiated customers into "Angels and Devils"[0]. I've always assumed there's some sort of credit score system built into every retailer account, and am somewhat conscious to try to keep it positive. [0]https://www.hbs.edu/faculty/Pages/item.aspx?num=32709 https://www.hbs.edu/faculty/Pages/item.aspx?num=32709

kube-system 4y ago

I bet this is actually it. I totally would ask for a price difference refund for a few bucks. But I’m not bothering with a return/repurchase for a couple dollars.

wikfwikf 4y ago

My guess is that they also might do market segmentation analysis to understand what type of customer you are, and this affects the return policy. For example, you consistently buy small ticket household items and rarely return anything: when you do return something they will be helpful and generous to keep you happy. You buy large amounts of fairly expensive clothes and shoes but return around 50% after trying on. They will accept the returns without issues but won't let you keep anything. You're a bargain hunter who buys expensive laptops or hard drives whenever the discounts look really good. They will make returning stuff a little harder for you since they know you don't have loyalty, and they don't want to facilitate arbitrage. Doing this is computationally no more sophisticated than the work they are already doing to detect professional scammers. They aren't supposed to show different customers different prices, but they can freely use things like this to do stealth price differentiation, since many details of how the return policy is implemented are at their discretion.

hotpotamus 4y ago
Somewhat famously, Best Buy did this and differentiated customers into "Angels and Devils"[0]. I've always assumed there's some sort of credit score system built into every retailer account, and am somewhat conscious to try to keep it positive. [0]https://www.hbs.edu/faculty/Pages/item.aspx?num=32709 https://www.hbs.edu/faculty/Pages/item.aspx?num=32709