Headline Feeds
In a move likely to start an online price war, Amazon.com Monday slashed prices 50 percent on all New York Times bestsellers.
Amazon.com's biggest markdowns yet come amid fierce competition from arch-rival barnesandnoble.com, as well as lesser-known Net shopping sites offering deep discounts on books.
Amazon's discount will apply to all bestsellers on The New York Times hardcover and paperback lists -- roughly 70 titles each week. Thus, for example, the No. 1 We'll Meet Again by Mary Higgins Clark, with a $25 list price, sells for $12.50, before shipping and handling.
"This is not a sale; this is not a promotion. This is everyday low pricing," said Jeff Bezos, founder and CEO of Amazon (Nasdaq: AMZN). "At Amazon.com, we've never asked customers to choose between low prices and great service. We give them both."
Amazon and barnesandnoble.com, the No. 2 online bookseller stung by Amazon's overnight success, have been competing fiercely for market share. Both routinely offer 20 percent to 30 percent discounts -- and as much as 40 percent on selected titles. But neither has emerged as a clear winner judging by price alone.
The competition, then, has focused mainly on building brand recognition through marketing and advertising; improving site design for easier use; tailoring content to individual tastes; offering e-mail updates on book categories specified by readers; and delivering better reviews. Amazon also has branched out into music and videos. Barnes and Noble says it will soon follow suit.
Through acquisitions and deals with big names such as Yahoo! and Dell, Amazon has expanded rapidly. It now offers online auctions, electronic greeting cards, even the Ultimate Star Wars Store, among numerous new ventures. But its chief revenue source remains book sales, and Monday volley clearly represents an attempt to shift the customer focus -- and the online retail competition -- to price.
Amazon touted the new discounts at the top of its home page Monday. Under the headline, "The Price is Right," Amazon said: "Starting today, Amazon.com adds the very latest in deep-dish discounts! You can now buy any book on The New York Times bestseller list."
By late morning, New York-based barnesandnoble.com, which is half-owned by Barnes & Noble Inc., has not responded with its own discount offers. But industry-watchers -- not to mention some customers -- will eagerly await the online booksellers' countermove.
Amazon sales have skyrocketed, to $610 million for the 1998 fiscal year, a 313 percent increase, and the company is on a pace to easily eclipse $1 billion in annual sales. Amazon continues losing money, however. For the first quarter, it reported a $61.7 million loss, but had more than $1.4 billion in cash. Its stock, which catapulted to $221 a share last month, was trading at about $126 Monday morning.
Amazon now boasts more than 4.7 million books, CDs, videos and DVDs and, in addition to its flagship U.S. site, operates international sites in the UK and Germany.
