Amazon's 'Make an Offer' platform offers more price control

Amazon (NASDAQ:AMZN) continued to expand its sales platform into niche categories with the announcement of the new "Make an Offer" feature. The option will allow customers to haggle for better deals while giving vendors more control over pricing.

At the moment, shoppers will only be able to make offers on sports and entertainment collectibles, collectible coins, and the fine art division the retailer launched last year. That encompasses 150,000 items, according to Amazon, but the retailer plans to expand the feature to other categories next year.

"The 'Make an Offer' experience gives customers more control and better deals than they may have received prior to this program," Steven Costello, executive VP of Steiner Sports Memorabilia said in an Amazon statement. "The negotiation experience will hopefully get more communication between us and our customers to help us better gauge the price for certain items. We love the 'Make an Offer' program, and it is only going to get bigger. Once customers know this is an available feature more offers will come, leading to more sales."

Control is also a benefit for sellers on the marketplace. Amazon's dominance in the e-commerce landscape is uncontested, but it has found itself at odds with some merchants over pricing control, most noticeably the recent spat with Hachette Book Group. The new feature, while optional for all vendors, should allow for more flexibility and make it easier for sellers to move items that may not have been competitively priced initially. And as Costello mentions, both Amazon and its vendors should be able to mine valuable data on how shoppers react to varying prices.

While the system takes some cues from eBay (NASDAQ:EBAY), the "Make an Offer" option isn't an outright auction platform. Amazon emphasized that it will consist of one-to-one private negotiations between customers and sellers, and buyers will never pay more than the listed price.

Still, there are some concerns that vendors may be able to game the feature. Merchants could simply raise their listed prices and put the onus on shoppers to bring them down, or ignore an offer until a more suitable buyer comes along. And despite Amazon distancing itself from the auction house comparisons, it's yet to be seen whether vendors will find ways to play competing customers off each other.

For more:
-See this FierceRetail story
-See this Amazon press release
-See this TechCrunch story

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