Fascinating to watch how Amazon (Nasdaq: AMZN) is trying to experiment with new business ideas within the context of its online store, even if most of their corporate efforts (according to BusinessWeek, at least) are focused on offering up their technological backend capabilities to everyone in the industry, even direct competitors.
For the Christmas shopping season, Amazon’s taken a leaf from its online auction service [am I the only person who remembers that they’re still kinda-sorta trying to compete with eBay (Nasdaq:EBAY), for that matter?] and are experimenting with customers voting on the best of a set of possible promotions.
Here are a couple of the offers up for the next vote:
Problem is, what happens in your customer community when things break down?
Amazon’s learning this the hard way with its most recent promotion, a rudimentary but functional Axion portable DVD player for the splendid price of $25. Hey, at $25 how can you go wrong, even if it lasts about one episode of Sex and the City before the battery is kaput?
The problem isn’t the $25 portable DVD player, it’s what happened when they ran out and people started leaving feedback:
“Complain to Better Business Bureau About Bait & Switch”
“Stop the winners auction”
“If you keep complaining, they won’t do it again next year.”
“you are going to ruin this promotion”
“All Christians Assemble”
“Now it’s a lottery?”
“Why are people so whiny?”
“Too many bad new rules”
These are just the pleasant discussions associated with this promotion, there are some additional threads that are, well, certainly not reflecting well on the company or its customers.
Within the threads there are additional interesting interchange, like this:
“I just logged in and tried to get the dvd player and it is already sold out. Totally ridiculous on amazons part to advertise having something and selling out already. This is a classic case of selling something without the supply necessary to satisfy the customer base.” Followed by this response: “it’s false advertising on a number of levels. suck it up.”
Is that the kind of publicity and visibility you’d want to be gaining for your business?
The problem here isn’t that Amazon’s trying to innovate and try something new (really something kinda like Woot, if you ask me) but as with so many experiments, it certainly appears to me that Amazon forgot to consider the law of unintended consequences.
In this case they didn’t ask what happens when we run out?
Imagine you had just a few hundred units reflecting some fabulous deal and you knew that your thousands of customers were going to be crazy about the opportunity. How do you run the program? First come, first served, knowing that you are inevitably going to disappoint lots of customers because of the simple logistics of Internet accessibility, or would you have a specific amount of time when people could register for the offer and then let them bid up the price again, or, finally, would you have a registration time and then randomly pick a subset of people to make happy?
Amazon’s still chewing on this one, and each time they’ve run this promotion they’ve changed the rules, which is darn confusing to their Amazon customers too, as you would imagine.
Now what, though? What’s Amazon’s next step?