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Ebay will match Amazon’s, Walmart’s and others’ prices on over 50K items

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Re: Ebay will match Amazon’s, Walmart’s and others’ prices on over 50K items

#4

Here's what I don't get. Why do a price match guarantee? Why not just price your items lower? Or do a "match" where you guarantee every item for 10 cents cheaper than your competitors?

Because not only can advertise your price matching feature and get more customers, but you charge your normal prices to the 90% of people who don't bother to price match.

Basically you can have your cake and eat it too. (To some extent)

Re: Ebay will match Amazon’s, Walmart’s and others’ prices on over 50K items

#5

Here's what I don't get. Why do a price match guarantee? Why not just price your items lower? Or do a "match" where you guarantee every item for 10 cents cheaper than your competitors?

I agree with you. Many of my racing friends get prices online and then have Discount Tire price match. I think that's stupid. I'd rather support the vendor that prices things "right" in the first place.

Re: Ebay will match Amazon’s, Walmart’s and others’ prices on over 50K items

#8

Here's what I don't get. Why do a price match guarantee? Why not just price your items lower? Or do a "match" where you guarantee every item for 10 cents cheaper than your competitors?

> Why do a price match guarantee? Why not just price your items lower?

MAD [1]. Price-match guarantees are meant to deter price competition. If you cut your price below a price-matching competitor's, the time you have the best price will be short. After that, less profit for everyone (assuming similar cost structures). If, on the other hand, you match, everyone keeps their market share and margins.

Price competition in a price-matching market happens when someone has lower costs. It also happens when someone uses cheap capital to buy market share, intending to make up for lower margins with volume, e.g. to cover fixed costs.

[1] https://en.wikipedia.org/wiki/Mutual_assured_destruction

Re: Ebay will match Amazon’s, Walmart’s and others’ prices on over 50K items

#9

Here's what I don't get. Why do a price match guarantee? Why not just price your items lower? Or do a "match" where you guarantee every item for 10 cents cheaper than your competitors?

Because not only can advertise your price matching feature and get more customers, but you charge your normal prices to the 90% of people who don't bother to price match. Basically you can have your cake and eat it too. (To some extent)

Doesn't that seem like some form of tacit collusion though? In this case it seems the price match flips the competitive environment so that competitors raise prices instead of lowering them.

Re: Ebay will match Amazon’s, Walmart’s and others’ prices on over 50K items

#10

Here's what I don't get. Why do a price match guarantee? Why not just price your items lower? Or do a "match" where you guarantee every item for 10 cents cheaper than your competitors?

Agreed. Prices being equal, why would I go with eBay? Their customer service and return policies are awful. It's 10x worse if you pay through PayPal. Amazon is basically no questions asked.
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