Would you accept cheaper rent in exchange for a monthly Amazon purchasing quota?
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Re: Would you accept cheaper rent in exchange for a monthly Amazon purchasing quota?
#2No. And I would expect anti monopoly laws legislation to outlaw this in any halfway civilised country (altho I wouldn't hold out much hope for America).
"The toaster oven will only accept certain co-branded bread and other marked-up food products: any attempts to cook other food will throw an error message; “Unauthorized Bread.”"
Barely fiction: Keurig, Juicero.
Re: Would you accept cheaper rent in exchange for a monthly Amazon purchasing quota?
#3Thought experiment (I don't actually want to go down this road): can you out-market Amazon in this scenario? If you have a $400 committed spend for a $500 rent discount, can you find people who would buy things from Amazon anyway and offer to make purchases on their behalf at a 1% discount (which is, on paper, obviously rational for them), such that you're now getting back $396 of the $400? Now you're spending a mere $4 for the $500 rent discount.
And in turn, why would market rent for your area be N instead of N-$500 (or N plus discount matching), if that discount is generally available? If everyone gets the $500 Amazon discount, then everybody has the switching cost problem, and so landlords would want to match what the market is actually willing to pay, not what it looks like they're paying on paper. This is basically the same scenario as early termination fees - when cell phone companies decided to increase the switching cost, other cell phone companies said they'd eat that increase in switching cost just to unlock locked-in customers that they couldn't reach.
And ultimately all of these mechanisms are annoying and fiddly mental overhead, but could purchasers band together and join an organization that negotiates on their behalf, organizes boycotts, etc. for a relatively small fee?
Re: Would you accept cheaper rent in exchange for a monthly Amazon purchasing quota?
#4Thought experiment (I don't actually want to go down this road): can you out-market Amazon in this scenario? If you have a $400 committed spend for a $500 rent discount, can you find people who would buy things from Amazon anyway and offer to make purchases on their behalf at a 1% discount (which is, on paper, obviously rational for them), such that you're now getting back $396 of the $400? Now you're spending a mere…
If something like what is described in the article ever became true, then I really hope someone invents something like APR for credit cards for these kinds of arrangements.
Re: Would you accept cheaper rent in exchange for a monthly Amazon purchasing quota?
#5Privacy issues aside, all that does is rob me of the opportunity cost of spending that money optimally and it forces me to spend it at a vendor that's not always the cheapest or most convenient.
Re: Would you accept cheaper rent in exchange for a monthly Amazon purchasing quota?
#6> The thing is, moving apartments has a high switching cost. It’s really something you want to avoid being forced to do, both for economic reasons and for social & personal reasons. Now, Amazon has you trapped: however much you may be inconvenienced or disappointed by being effectively required to purchase Amazon’s stuff rather than other merchants, it’ll be less bad than the monumentally large cost of moving apartments.
Worse: in this scenario, "Amazon" competitors are unable to provide competitive pricing any more because everyone else, like you, waited a few cycles, and now they don't get enough sales volume for that. It is no longer economical for you to leave for another apartment that doesn't mandate this supply monopoly. The only way to break out of the cycle is if 1) a large proportion of people in your situation agree to move at the same time, which is particularly difficult because of individual circumstances as well as political will; and 2) all of you can afford to prop up the more expensive competing suppliers until volume discounts start rippling through the supply chain.
* I say "Amazon" because this is entirely hypothetical, as the author admits, and I think it's rather unfair to use Amazon's name like this, which the author does not.
Re: Would you accept cheaper rent in exchange for a monthly Amazon purchasing quota?
#7Interesting thought experiment, but I don't think the economics work out.
Retail has razor thin margins as it is, so I can't imagine companies paying customers enough to make a significant enough dent in their rent.
Also, the practice of buildings selling exclusive customer access to certain companies already has precedent - cable providers. And as you may imagine, profits or savings from such deals are never passed down to renters.
Re: Would you accept cheaper rent in exchange for a monthly Amazon purchasing quota?
#8Privacy issues aside, all that does is rob me of the opportunity cost of spending that money optimally and it forces me to spend it at a vendor that's not always the cheapest or most convenient.
The company store for tenants. Dystopic.
Re: Would you accept cheaper rent in exchange for a monthly Amazon purchasing quota?
#9Re: Would you accept cheaper rent in exchange for a monthly Amazon purchasing quota?
#10Privacy issues aside, all that does is rob me of the opportunity cost of spending that money optimally and it forces me to spend it at a vendor that's not always the cheapest or most convenient.
The company store for tenants. Dystopic.
That's my first thought as well. What's next? Amazon credit card with discount on Amazon and minimum spend for even cheaper rent?