Consumer Watchdog: Amazon Prime Day More Like ‘Slime Day’
While you’re busy making your shopping list for Amazon Prime Day, Consumer Watchdog is warning against the Amazon’s pricing practices.
“While Amazon celebrates its Prime Day, their pricing scams may make it more like Slime Day,” said John M. Simpson, Consumer Watchdog Privacy Project director.
Last week, Consumer Watchdog asked the Federal Trade Commission to prevent Amazon’s purchase of high-end grocery chain Whole Foods until it stops using pricing practices it alleges are deceptive and may violate the commission’s rules.
Consumer Watchdog conducted two studies this year. The first, in March, looked into market prices. The group says it found the “list” price Amazon showed alongside the site’s current price made customers think they were getting a deal.
The organization says those list prices were much higher than prices typically available from other retailers and created a straw man reference price that was basically fake.
Amazon refuted the report, claiming it used list prices when it had compelling info and the “was” price to show a discount off its own pricing.
In June 2017, Consumer Watchdog used independent price-comparison tool Nextag to conduct a second study of 1,000 products on Amazon’s site to evaluate the new pricing scheme.
The organization says it found that 61% of “was” prices were higher than any price observed on the site in the previous 90 days. It also claims that 38% of reference prices were higher than any price Amazon had charged for the product.
“In other words, in nearly four in ten cases, Amazon never appeared to charge the previous price from which it claimed to be discounting,” John Simpson, the organization’s privacy project director, wrote in a letter to the Federal Trade Commission and the Department of Justice last week. “The ‘price’ was entirely fictitious.”
The bright spot in the latest report: “Strikethrough prices were found to be highly reliable,” the letter noted. “All prices with just a line through them (and no words suggesting what they referenced) corresponded to actual prices charged by Amazon in the recent past.”
Meanwhile… How to Shop Smart
Consumers looking for deals on Amazon shouldn’t take pricing at face value, Simpson said in a press conference today.
“Look online. If you see something you want and it’s convenient, you can make your own independent judgement about whether you should buy it or not,” he said. “Don’t believe the notion that these are great deals. You should be comparing the prices elsewhere yourself.”
Lisa Rowan is a writer and producer at The Penny Hoarder.
The Penny Hoarder Promise: We provide accurate, reliable information. Here’s why you can trust us and how we make money.