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Amazon’s $23,698,655.93 book about flies

michaeleisen.org

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Re: Amazon’s $23,698,655.93 book about flies

#91

Post by ig1 »

mdda wrote: post #43
ChuckMcM wrote: post #37

Earlier quoted context omitted.

If you play World of Warcraft this is a solid Auction House technique. I find it humorous to see it applied to the 'real' world (not that WoW economics aren't just as 'real'). The ability to push the price down gives informed actors some pricing control on the market, and the subtext is that it allows for folks to push around pricing to understand the elasticity for any product. Now if you can get them to buy a 'put'…

And (from what I understand) this is just the kind of thing that High Frequency Trading algorithms are doing.

Offering to sell stocks at a below-market price without an intention to complete the deal is market manipulation and illegal in most countries.

Re: Amazon’s $23,698,655.93 book about flies

#92

Post by AretNCarlsen »

sesqu wrote: post #70
AretNCarlsen wrote: post #31

Earlier quoted context omitted.

bordeebook was effectively increasing their price by a factor of 1.2684/day, and as of Apr 8 priced the new book at $2,198,177.95. I'll guess that the used price ($35.54) implies that the initial pricing of the new book was about $50. Log base 1.2684 of the ratio of the Apr 8 price to the estimated original price = log($2198177.95/$50)/log(1.2684) = 45 [days]. Ergo looks like the two algorithms started competing arou…

The original price candidate, derived from the logarithm, that is second closest to integer cents is 62.91998, with 162.85966 coming in 6th and the other positions filled by implausibly large numbers. Neither number has integer cents, since the actual series rounded or truncated values between iterations. For that reason, a simple logarithm won't tell us what the original price was - you'd need a simulation of the ro…

Good idea! Here it is in C: http://pastie.org/1824968 (You have to manually add the 'f' after the constants if you want to do the whole thing in floating-point, as well as uncommenting the correct Dollars_t definition.)

For the range $20.00 to $200.00, no exact matches to an integer original price (in cents) for the algorithms ceiling, floor, or round, in float or double. This was on a 32-bit Xeon server (EC2).

Re: Amazon’s $23,698,655.93 book about flies

#94

Post by atakan_gurkan »

Pricing something high can actually increase sales. There is an example in Cialdini's book "Influence", near the beginning of chapter 1. A jewelry store owner was trying to get rid of some items, instead of marking the price down, she marked them up (by a factor of 2), and they were rapidly gone.

It is a nice book to read, and will probably make you feel uneasy when you realize the abundance of manipulation tactics around us.

Re: Amazon’s $23,698,655.93 book about flies

#95

Post by scorpion032 »

geekfactor wrote: post #36

Hmmm. I wonder if this would work in reverse? Suppose I want to buy a book that has several new copies for sale on the Amazon Marketplace for say $60. If I post a new copy for sale for $10, perhaps one of these algorithms would kick in to reduce the price?

In the meanwhile what would you do if you get placed an order for several of those?

Re: Amazon’s $23,698,655.93 book about flies

#96

Post by maayank »

jaysonelliot wrote: post #39

I can't begin to describe how much this pleases me. It's straight out of a William Gibson novel, but happening right now . God, I love living in The Future.

Indeed, I was also reminded of WG.

Alas, while it seems that information technology-wise we delve more and more into a cyberpunk world, health-wise and body modification-wise we are still not there. Where are my grafted muscles and commodity eye-balls?

Re: Amazon’s $23,698,655.93 book about flies

#97

Post by mjw »

lsc wrote: post #14

oh man. reminds me of the days when I sold books on amazon and half.com. I wrote a script that took the 'nickel less than the other guy' approach. These things are /wonderful/ when it comes to making the market more efficient. Really, though, the shipping costs eat up most of the efficiency. Amazon needs an easy way to say "I want these 10 books, used. Find me the lowest price (including shipping)" - the idea is that…

Interestingly I was reading a paper about this the other day:

http://faculty.cs.tamu.edu/ioerger/ICAI04-linli1.pdf

It uses textbooks as its example too :)

There seems to be a reasonable amount of literature on algorithms for this kind of combinatorial optimisation, including reasonably fast but well-performing heuristics like the above. Maybe amazon should pull their finger out.

Re: Amazon’s $23,698,655.93 book about flies

#98

Post by ig1 »

ig1 wrote: post #91
mdda wrote: post #43

Earlier quoted context omitted.

And (from what I understand) this is just the kind of thing that High Frequency Trading algorithms are doing.

Offering to sell stocks at a below-market price without an intention to complete the deal is market manipulation and illegal in most countries.

Er...why was this downvoted ?

I'm not a lawyer, but I've worked in the financial sector and undergone FSA mandated training courses on what you can and can't legally do with equity pricing. What the OP was suggesting is an illegal practice in most equity markets.

Re: Amazon’s $23,698,655.93 book about flies

#99

Post by rapind »

siegler wrote: post #21

A similar thing happened to me as a seller. I saw that one of my old textbooks was selling for a nice price, so I listed it along with two other used copies. I priced it $1 cheaper than the lowest price offered, but within an hour both sellers had changed their prices to $.01 and $.02 cheaper than mine. I reduced it two times more by $1, and each time they beat my price by a cent or two. So what I did was reduce my p…

This is possible because the algorithms running are still immature and the creators either didn't setup any sanity limits because they are inexperienced or maybe lazy.

I wouldn't expect this to last very long, but you could potentially take advantage of it while it does by simply identifying seller's who lack limits and posting products within their categories at super low prices then buying them out and re-listing.

Eventually all of these scripts will have guards in them for upper and lower and probably limits on the percentage change over time.

Re: Amazon’s $23,698,655.93 book about flies

#100

Post by Jd »

crocowhile wrote: post #89
gcb wrote: post #86

Earlier quoted context omitted.

How is that so? ...always like there's always people willing to buy books at amazon?

not quite. What OP described would not work in automated finance, where once the book approaches $5 an army of computers would try to buy it before him.

I'd imagine that's only so if some human has intervened and told the "actual value" of something.

However, I'd imagine that in just as many cases, if not more, there is no real "actual value" -- only computers playing with each other.

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