Amazon.com gets undercut
marketwatch.com
By Bambi Francisco, CBS.MarketWatch.com
Last Update: 11:29 AM ET June 25, 2002
SAN FRANCISCO (CBS.MW) - Shares of Amazon.com fell 8 percent Tuesday on concerns the company's core book-selling business will be undercut by a rival's price-slashing plan.
As reported in this column last week, Buy.com said it's offering 10 percent off book prices listed on Amazon.com (AMZN: news, chart, profile). Amazon.com lost $1.17 to $16.34.
Last Wednesday, Aliso Viejo, Calif.-based Buy.com said it would offer free shipping with no minimum purchase on certain items. The move came a day after Amazon lowered the threshold for free shipping, waiving charges on any order over $49.
"It's the only way these companies can compete because the shipping was killing them before when consumers wouldn't pay for shipping," said Geri Spieler, an analyst at Gartner.
On Monday, Amazon.com and Virgin Entertainment Group inked a deal to co-brand Virginmega.com -- Virgin Megastores' second attempt to have an online presence. The idea behind this partnership is to maintain the 30 million customers that walk into the 22 Virgin Megastores in North America by having an online presence, according to Dave Alder, senior vice president of product and marketing at Virgin Entertainment Group, North America. |
