It’s a big week for on-line shopping so I thought I would discuss an Amazon program I stumbled across this weekend. My goal was to order a simple kitchen brush. A quick search showed that Amazon carried the product and that it was in stock. But there was a catch. Check out that little tag in the picture below stating that this is an “Add-on Item.”
So just what does that mean? Here is how Amazon explains it:
The new Add-on program allows Amazon to offer thousands of items at a low price point that would be cost-prohibitive to ship on their own. We’ve kicked off the Add-on program with thousands of new Add-on Items, and we’re adding more each day. Add-on Items ship with orders that include $25 or more of items shipped by Amazon, and you can get them delivered to your doorstep with free shipping. …
If you have an Add-on Item in your cart but less than $25 of items shipped by Amazon you can still check out with the rest of your items. When you proceed to checkout we’ll give you the choice either to keep shopping or to check out with the rest of your items and save your Add-on Items for later. We’ll keep your Add-on Items in the “Saved for Later” section of your cart so that you can easily add them to a future order.
Or to put it in a straightforward fashion: Amazon won’t sell me a kitchen brush unless I buy something else.
Note that it doesn’t matter here whether you are an Amazon Prime customer or not. You still need to get to $25 in order to buy the item. They won’t even quote you price with shipping if you were willing to pay a premium to get it without bundling it with something else.
According to All Things D, Bezos and Co. rolled this out back in May and it mostly hits on the “household goods, beauty or grocery categories.” For example, a search on toast tongs shows that there are many tongs that are impossible to buy some as a stand along item. Not to surprisingly, a quick web search shows that many customers are none to please with this exciting new program.
I wonder if this is a case where operational thinking trumps customer service. I completely get that the cost of chasing down and packing up one pair of four-dollar toast tongs is high relative to the margin on the product. That argues for dissuading customers from asking for just the toast tongs. Amazon’s Super Saver Shipping is one way of accomplishing this. The Super Saver program offers free standard shipping when orders top $25. Thus a bargain hunter looking for a sweet set of toast tongs is largely unaffected by the Add-on program.
So who is taking the hit? Prime members such as me who have already paid for “free” shipping but now do not have the convenience of getting just a kitchen brush. Stated another way, Add ons reduce the usefulness of the Prime program for customers while cutting Amazon’s cost. But just how abusive are Prime members? The program has been praised for locking customers in to shopping at Amazon. Eroding the benefits of being in the program may over time cost Amazon customers. Does Amazon really save enough on handling toast tongs to justify losing loyal customers?
A final point. I sent Amazon an email when I was trying to figure out just why I couldn’t buy my kitchen brush. Amazon customer support must live in an irony-free zone. The email response explaining that I was just out of luck on buying the brush without bundling it with something else closed with the following:
Your feedback is helping us build Earth’s Most Customer-Centric Company.
Customer-Centric, indeed!
It seems as if Amazon is caught in the standard costing model trap of operations logistics. Sure they make low margin on kitchen brushes but are they firing people when they sell fewer kitchen brushes? I doubt it. Their fixed cost of personnel does not translate directly to more profit when less kitchen brushes are sold. As you point out though, their overall cash flow may decrease if they start losing customers who are peeved about paying for Prime privileges but still get thrown into coach class with the Add-ons.
Interestingly, part of the problem may be in the message. Your interpretation of their policy was, “Amazon won’t sell me a kitchen brush unless I buy something else.” What they have said is “We can only add these new products under certain conditions.” I wonder if they are really going to generate more revenue and profit with the add-ons.
A potential outcome is that even if Prime customers are not driven away because of pique over the new policy, very few people will plan their purchases so they can get an add-on when they buy, for instance, a new Kindle.
Another strategy is just to remind people, when a purchase greater than $25 is being made, that add-ons are available. It’d be like placing the gum and candy next to the check out lines–add-ons marketed as impulse buys.
Ed Pound
[…] brief follow up to Tuesday’s post on Amazon’s Add-on Items. Recall that was the program that keeps Amazon’s Prime […]
That is not true. You can buy the kitchen brush if you pay shipping to another seller. Click where it says “16 new from $$” then it lists multiple sellers. The ones that are not amazon or fulfilled by amazon don’t have the add-on limitation.
I am really annoyed with this ADD ON on orders over $25. I have had some items I really want sitting in my cart for far too long. I can’t seem to meet the right conditions in my cart to get the item sent. I’m frustrated now too. I tried to check out with my super saver shipping and the new amazon prime ad is basically forcing me to try it free. I don’t want to try it. I’m already shopping and getting super saver shipping why would I want to pay $79 more a year for what I now get for free? Amazon is quickly becoming too profit-oriented and all the reasons I shop at amazon are quickly disappearring. I think I’ll start spending more time at Zappo’s where I pay more for an item but I get impeccable service and free shipping every time.
Just had the same experience today – I wanted to buy a kitchen strainer. I was happy to pay the shipping. Today I wanted to buy 2 more in different sizes, learned I could not, and I happily bought them outside Amazon! Yay! Thank you Amazon for no longer incentivizing me to buy from you. Keep up the good work.
Things have changed a bit its now $35 for qualifying and the list of Add-on items have grown, they are so annoying to find if you don’t know how to actually find them when using them for free shipping directly.
I was also surprised that Prime members were held to a similar standard as regular customers where these items were concerned. Seems Amazon uses the program to sell items that customers would not normally buy and with this it boosts the sales of these small but useful items, who knows.
I don’t normally purchase household items at Amazon so I just ran into this. Talk about frustrating! There is simply no way to purchase the item I want – whether I want to pay for shipping or not, I cannot order the item unless I buy a bunch of other things I don’t need.
Supposedly you can uncheck the little checkbox and add it to your order as paid shipping but it won’t actually do so. I finally gave up and cancelled my whole order. I know I am microscopically small to Amazon but I will never order another add on item again from them – there are too many others out there for Amazon to be dictating to me what I will and will not do.