Just in time for Christmas shopping, the online giant Amazon.com launched, and heavily promoted, a new comparison-shopping app.
Sounds good, right?
Using their mobile phones and Amazons software, shoppers can instantly compare a price with Amazons and all of Amazons third-party sellers.
Heres what Amazon says: The goal of the Price Check app is to make itas easy as possible for customers to access product information, pricing information and customer reviews, just as they would on the Web, while shopping in a major retail chain store.
That sounds good too, because information is power.
But heres what Amazon does: The online retailer offers a 5 percent discount to induce shoppers to buy the item from Amazon instead of from the store where theyre currently standing.
Amazon says the app is not aimed at small businesses but at big-box stores. However, those small businesses already have a hard time competing with the prices at large chains with much greater buying power, and they already have trouble competing with the prices at Amazon.
Amazon has several advantages. It doesnt have to maintain brick-and-mortar stores, those places where customers go to try on clothes, heft appliances and otherwise collect information that helps them make decisions based on more than just price. When customers shop at home but then buy from Amazon, local merchants essentially have just provided free advertising for a big competitor.
Those local businesses are also the places where students ask for contributions to fund extracurricular activities, where civic groups sell raffle tickets, where helping agencies ask for the money that allows them to help more needy locals. Amazon is absent from that arena.
Amazon also doesnt have to collect sales tax or pay local taxes on the buildings it doesnt have and the income it doesnt have to report, which means that it doesnt help fund local schools, hospitals, streets and law enforcement. It argues that it doesnt utilize those services, but its customers do, and the money they spend with Amazon does make a difference to the budgets of the agencies providing them.
From now on, consumers will be able to compare prices with great ease. That horse is out of the barn, and if Amazon hadnt flung open the door, someone else would have. But wow, the timing was poor. The Christmas-shopping season is make-or-break time for retailers, and the price competition this year seemed fiercer than ever before. Amazon also picked a time when everyone seemed to be short of cash, and a season when they werent likely to slow down and weigh the benefits of shopping locally vs. saving money.
Corporations (whether or not theyre legally people) have no responsibility to be kind. They exist to make money. But local businesses earn more when they consider how their actions will affect the community, while large chains and online businesses thrive by undercutting competitors, not by being responsible citizens of local communities.
When you shop, remember that. By all means, compare prices. But then try to assign a percentage of the small-business price to local preference, the amount youre willing to pay for a healthy business community of neighbors and friends. Cheaper isnt always better, and sometimes the cost of saving a few bucks can be awfully high.