Amazon raises prices on Cyber Monday

By George Anderson

NOVEMBER 14, 2014

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The popular perception is that retailers bring out the big deals for Black Friday and Cyber Monday, but that has not been the case in recent years, according to research conducted by Upstream Commerce.

Last year, for example, Upstream looked at pricing on the top 20 athletic shoe brands sold on Amazon, Macy's and Zappos. It found that Amazon offered the biggest discounts on Black Friday but raised prices on Cyber Monday.

"There was no consistent strategy or head-on competition among the retailers," said Amos Peleg, CEO/Co-founder of Upstream Commerce, in a statement. "The average discount rate attained at both Amazon and Zappos (at different times in the scale), was 2.8 percent, but was only 0.5 percent for Macy's."

In 2011, the company did price checks on televisions and toys sold by Amazon, Best Buy and Walmart. As with athletic shoes, Amazon offered the biggest discounts on Black Friday and then pulled back on Cyber Monday.

Best Buy was more selective with its discounts. The chain offered deals on TVs, but raised prices on games and toys for the 2011 holidays.

Walmart's average prices for Black Friday and Cyber Monday, were actually higher on items studied than they were on Nov. 15 of that year. According to a Dec. 8, 2011 post on Upstream's blog, "This surprised us, so we analyzed further and found that average prices went up on Black Friday and Cyber Monday because many of Walmart's less expensive products were out of stock (and had not been restocked). This of course makes you wonder — did Walmart prepare properly for these two critical days of the year? It seems that they might have left money on the table, or, conversely left consumers unable to buy goods at the usual, expected low Walmart prices."

In both the example from last year and 2011, there was no clear pricing strategy from the various retailers based on the competitive marketplace. Price matching has become the answer in recent years as retailers have become concerned about consumers' perceptions about prices (and that they may not have the best ones).

"Retailers should stop chasing each other around," said Mr. Peleg. "Employing predictive pricing strategies based on competitive analytics is the only way retailers can price optimally to sell the maximum number of products most profitably."