4 ms·

All great points for how this benefits Amazon, but not the consumer. It just locks up your money in their ecosystem.

• rogerbinns 14y ago
  Well for a start the system has to work this way to be practical. If there was a credit card transaction for every coin use then the minimums would have to be a lot higher in order to take into account processing fees. You can't sell something for 20c paid by credit card. Even a sale for $1 eats up a fair bit in processing fees. But converting $20 into "coins" then allows the coin based transactions to be for far smaller amounts (eg equivalent to 10c). Obviously Amazon and other virtual currency providers need to give you a good reason to get sucked in. They are largely successful. One approach that seems to work is paying to save time. eg when playing a game you can unlock various items and make progress just by playing the game for quite a while. Or you can do a transaction to accelerate that such as getting an item immediately or unlocking levels. Americans also have a tendency to prefer fixed known in advance costs over variable ones. Note for example how telephone service has been that way. If you buy $20 worth of coins then you know you can never spend more than $20. On the other hand if your credit card is on file and used in every transaction then you could end up being dinged for far more than you expected.