Anyone care to take a stab at estimating the consumer surplus generated from the price war blowing up between Amazon, Wal-Mart, and Target?
The price war began last week when Wal-Mart announced that it would offer Walmart.com customers who preordered any of 10 of the coming holiday season’s biggest potential best sellers the chance to buy the books in hardcover editions for just $10. Typically new hardcovers sell for $25 to $35, although some discounting is common.
Amazon.com quickly matched Wal-Mart’s preorder price on the same books, which include “Ford County” by Mr. Grisham, “Under the Dome” by Mr. King and “Going Rogue,” Sarah Palin’s memoir. Wal-Mart then lowered the price to $9, and Amazon followed suit. By late Friday afternoon Wal-Mart had cut another penny off the price.
On Monday, Target entered the fray by offering six of the preorder titles on Target.com for $8.99. By Tuesday Wal-Mart had lowered the price on those titles to $8.98.
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Interestingly, independent booksellers are claiming that this price competition “is damaging to the book industry and harmful to consumers.”
Well, I don’t know how damaged consumers are by paying half price for hardcover books, but it is certainly won’t be good for independent booksellers.