Amazon’s shamefully shoddy strategy


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Over the years, I’ve found much to admire about Amazon. They have generally made it easy for me to buy from them, and on the rare occasion they have messed up, they have always been quick to fix the problem. They have become my preferred place for online purchases.

amazon logo unsmile 200Amazon Prime – which for a fixed annual fee offers free delivery – has been an important part of the offer. But now a reprehensible change in their terms, made worse by a clumsy and inept attempt to justify the change as “adding value”, is causing me to rethink my relationship.

Judging by the storm it is whipping up on social media – fuelled by the BBC’s respected Rory Cellan-Jones amongst others – I’m not the only one to be surprised and offended by the actions of an organisation I had come to regard as a paragon of customer enlightenment.

When “added value” is just another word for rip-off

I’ve never been a fan of organisations that use the tactic of bundling unwanted and unasked for “added value” as a justification for imposing a substantial and unwarranted price increase. 1&1 Internet tried it on a while ago before rapidly and rightly finding reverse gear.

Judging by Amazon’s response to my complaint, however, they appear to be stuck in fast-forward and hurtling towards a customer satisfaction cliff.

Here’s the background: a day or so ago, I got a banal and bubbly email from Amazon UK Customer Services breathlessly announcing “some exciting upgrades and changes” to my Amazon Prime subscription. Apparently, I was going to be able to stream videos from shows I had never dreamt of wanting to watch via their Prime Instant Video service.

A 60%+ price increase for nothing

Initially, this useless addition would be free. But when my Amazon Prime membership next came up for renewal, I was going to have my subscription fee hiked by over 60%. For a service I have no desire to use.

But here’s the really nasty and sneaky thing: I can’t opt out, and just carry on subscribing to the original Amazon Prime service at the original rate. I either have to pay their outrageously elevated rate in full, or not use Amazon Prime at all.

Despite (you might want to detune your bullshit detectors before reading the next bit) claiming that “customer feedback such as yours helping us to continue improving the selection and service we provide”, Amazon have refused my request to stick with the current scheme.

A blatant abuse of monopoly power

It’s all or nothing apparently. Now, I’m not going to cut off my nose to spite my face and stop using Amazon immediately. But you can bet that instead of feeling positive whenever I buy from them, I’m going to be feeling negative and earnestly looking for alternatives.

This just feels like an abuse of monopoly power. Amazon are trying to rescue a patently failing peripheral service by forcing it down the throats of their mainstream customer base and making them pay for the privilege.

My guess is that they are going to take so much stick for this that they will be forced to retract. But how much damage will they have done to their brand in the meantime? And what of the career prospects of the bright spark that came up with this stupid idea in the first place?

Republished with author's permission from original post.

Bob Apollo
Bob Apollo is the CEO of UK-based Inflexion-Point Strategy Partners, the B2B sales performance improvement specialists. Following a varied corporate career, Bob now works with a rapidly expanding client base of B2B-focused growth-phase technology companies, helping them to implement systematic sales processes that drive predictable revenue growth.


  1. Before e-commerce, purchase transactions were much more deliberate. In a retail store, a customer had to lug items up to a counter. Typically, a customer was charged only for what he or she placed in front of the cashier. In a B2B transaction, a purchase order had to be generated, and there was a laborious paper trail to complete the transaction. A cumbersome process, but oddly, one that protected both the customer and the supplier.

    Now that opt-in/opt-out has blurred our concept of the moment when a “purchase” has taken place, vendors can do – and have done – some pretty squirrely things. I wonder whether Amazon designed the timing of the service bundling at the inception of Amazon Prime, or whether it was added later, when a clever marketer had an epiphany for how to ratchet up revenue without incurring much cost.

    Either way, Amazon’s behavior is cruddy. The best way to convey that opinion is by boycotting the service. I hope they get the message.


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