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Pricing for Prime is totally disconnected from costs. They will price at whatever maximizes p*q.
by brookst 2y ago
Pricing for Prime is totally disconnected from costs. They will price at whatever maximizes p*q.
- Exoristos 2y agoWhich is impacted by perceived value:cost by customers.
- brookst 2y agoYep — if consumers see AI as added value they’ll pay more. But practically nobody will base their willingness to pay on guesses about Amazon’s COGS. The new AI feature could be pure excess capacity and cost Amazon nothing, or it could cost Amazon $1000/user/month, and nobody will know or care.