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Andy Atkinson

"First, people are loathe to create yet another online account. Second, they would like to deal with a known entity where possible. Third, they have probably had some positive experiences with Amazon in the past"

1) there is a small typo in the first sentence around loathe, but I agree with this point. Many resellers are now offering the ability to "check out" without creating an account, which I think is great (the account should really be optional anyway--you don't create an account at Wal-Mart when you are buying toothpaste)

2) Amazon is a known entity, yes brand recognition is a big deal. I just tried to order a computer part from Page Computers, cheaper than NewEgg and Amazon, they are burning me on shipping (taking forever!) where I know what to expect from Amazon (fast UPS shipping) plus have returned products with return shipping paid for by Amazon (good!).

3) See the end of #2

Marc Mezzacca

Good points Andy. Brand recognition is a big deal. It is a trade-off of price for service. Consumers, whether they are online or traditional brick-and-mortar shoppers, have a specific comfort zone. When they become accustom to shopping somewhere, they tend to stick with it. A significant offer must be made to sway them to take the time to try to another vendor. There is an opportunity cost for the consumer that must be associated with him/her trying out a new vendor. The savings must be (far) greater than the opportunity cost for that particular consumer or he/she will surely not take the time.

We have seen a great deal of loyal Amazon consumers. I myself didn't realize how even the biggest bargain hunters will pay a bit for a brand they can trust, such as Amazon in this case.

Glad it's all cleared up with my name ;)

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