Amazon’s Diminishing Discounts

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The changing price of a book of Octavio Paz writings demonstrates the mysteries of Amazon.Credit

Is it just my imagination, or is the price of physical books on Amazon going up? I have no evidence beyond what I see as I browse through the retailer’s virtual shelves, where I have routinely been noticing books selling for the same price they cost in the rest of the world. Selling at full price is not the sort of value proposition that propelled Amazon to its current perch as one of the country’s biggest and most feared retailers.

A few examples of books published in the last year or two that Amazon is offering at zero discount from list price: “Liebling’s War: World War II Dispatches of A.J. Liebling.” Brian Boyd, “Stalking Nabokov.” Gerald Suttles, “Front Page Economics.” Deborah Kohn, “The Latin American Literary Boom and U.S. Nationalism During the Cold War.” Sandra Messinger Cypess, “Uncivil Wars: Elena Garro, Octavio Paz and the Battle for Cultural Memory.” Others are only marginally discounted: Ira Wood’s “You’re Married to Her,” published by Leapfrog in August, is available at a whopping 4 percent discount. I could get the book $2 cheaper directly from Leapfrog. Juan Rulfo’s “The Plain in Flames” is off 3 percent.

(Here are some caveats: These are all new books sold by Amazon itself, not by third parties that may have damaged or used or other copies for cheaper. Books published by university presses are often available at a smaller discount than books from trade publishers. And yes, there are doubtless many popular books on Amazon at big discounts. But like many readers, I go to Amazon for the long tail — little-known books that are unavailable in even the best-stocked bookshop.)

The issue of pricing on Amazon matters for more than my pocketbook. The central question about the company has always been: How will it choose to make money? It has invested for the future for 18 years now, in the process demolishing much of the competition while giving it one of the priciest stocks on Wall Street. But at some point, somehow, it will have to become a normal business, which means selling things for more than it paid. One way to do that: erase discounts on books that readers cannot easily get anywhere else.

Another possibility: Amazon is intentionally pricing its books higher so buyers will instead purchase from the cheaper third-party sellers, which are more profitable for Amazon. In other words, Amazon would rather run a mall or bazaar than try and be Wal-Mart.

In response to a query, Amazon said, rather generally, that it wasn’t raising prices.

Amazon executives say the price of a book falls as it sells faster, but the site has always seemed more mysterious than that. Here’s one example of a book dropping so fast it seemed to be falling out of the sky, but I doubt it was because people were gobbling up copies. In July, Arcade published an omnibus of the works of the Nobel laureate Octavio Paz. List price: $40. Over the rest of the summer and into the fall, the price tumbled. By Nov. 12, it was down to $1.32 — a 97 percent drop. Mr. Paz is dead and out of fashion, so it seemed as if he was on a rather quick trip to the recycling bin. I finally took pity on the book and bought it. As a Prime member, I got it shipped for free.

The book arrived promptly but was damaged. So I complained, and Amazon of course said it would send another and refund my postage. Now presumably Amazon is still paying the standard rate to Arcade for the book — about $18. (Arcade didn’t get back to me.) Amazon’s total revenue from me on this deal was $1.32. It had to send me the book twice and refund my return $3.99 shipping. Overall I’d guess that Amazon lost about $30 on this transaction.

Perhaps because I bought a copy, the book didn’t last at $1.32. It is now back up to $11.34. Who ever thought that buying a physical book would have all the mystery and excitement of buying a plane ticket?