Pricing Strategies, was directories

llevitt@idcresearch.com
Tue, 6 Dec 1994 10:31:06 -0800

Fred writes:
> A third edge is that net commerce can offer much lower prices
> than physical stores and even stores selling through catalogs,
> because the core marketing and transaction costs are so much
> less.

Well, here's an interesting question. Take a look at prices of stuff online
today, through any online medium, and you'll find parity between store/catalog
prices and online. IE - LL Bean sells the same stuff at the same price through
retail, catalog and online.

Why is this? Consumers *know* that it's cheaper to sell online, why don't prices
reflect this accordingly? Shouldn't *we* provide an incentive to shift
procurement patterns to the low-cost channel?

Lee Levitt
Director
Distribution Channels Research
International Data Corporation
llevitt@idcresearch.com