MONEY online shopping

7 Things You Probably Had No Idea Amazon Sold

repairman arriving at front door
Peter Dazeley—Getty Images

What do autographed vintage Air Jordans, environmentally friendly baby wipes, cheap wine, and plumber recommendations have in common? You can find them all at Amazon.com.

On Monday, Amazon announced the official launch of Amazon Home Services, a marketplace and recommendation tool to help people find, schedule, and pay for services like home cleaning, lawn care, and handyman jobs. The new service is obviously competing in the same space as user review tools like Angie’s List, Yelp, and Porch, and customers with verified purchases made through Amazon will be able to review services as well. Amazon also says all of its professionals are handpicked and fully insured, and if anything goes wrong with a job it promises to “work with customers and the pro to ensure the job gets done right or provide a refund.”

Amazon’s entrance into the sphere of contractors and professional home services may seem a little out of left field. But the move makes total sense in light of the company’s overarching mission—to become the destination for anyone wanting to find and purchase pretty much anything.

Here are a few other seemingly odd retail categories that Amazon has ventured into recently. They haven’t all been successful. In fact, some have basically been flops. But when you’re trying to take control of the marketplace for selling everything under the sun, a few misfires and false starts should be expected.

Fine Art
Amazon Art launched in the summer of 2013 as a marketplace selling tens of thousands of paintings, sculptures, photographs, and other works—including some originals from masters like Monet and Norman Rockwell, with list prices into the millions of dollars. Perhaps unsurprisingly, some in the highbrow art world have been skeptical about the idea of one-click ordering, say, a Rembrandt.

Renowned economist Tyler Cowen pointed out the absurdity of being asked to pay $4.99 for shipping for a “mediocre Mary Cassatt lithograph” listed at $185,000, and wrote that he hoped Amazon Art was “a doomed venture.” The New Yorker noted that actually selling and profiting from high-end art may not be the point for Amazon: “Regardless of whether Amazon Art revolutionizes the art world, it will contribute to the perception that Amazon is working to create: whatever it is you’re looking for, you only need to remember one U.R.L.”

Fresh Flowers
About the same time Amazon was getting into fine art, it quietly launched The Amazon Curated Flowers Collection, in which the e-retail giant would be selling and shipping flowers directly to customers. Apparently, the venture didn’t work out. Recode reported that the Collection was kaput within a few months, and now the only flower bouquets that can be ordered through the site come from third-party vendors.

Diapers & Baby Wipes
Another venture that seems to have not worked out as well as Amazon wished was its recent entrance into the diaper business. Last December, the company began selling Amazon Elements, its own brand of high-end, environmentally friendly diapers and wipes. Less than two months later, bad feedback from customers pushed Amazon to discontinue the diapers and take them off the market, at least until design improvements could be made. Amazon Elements Baby Wipes, meanwhile, are still listed for sale at the site, where they get a 4.5-star rating.

Collectible Coins
Amazon’s Collectible Coins marketplace hit the site last May, allowing shoppers to search, browse, and buy thousands of rare and historical authenticated coins from dozens of dealers. Like Amazon Art, the coins purchased via Amazon can be priced into the millions, and Amazon gets a cut of every sale—reportedly 5% to 20%.

Sports Memorabilia
Among the wide selection of autographed sports collectibles currently up for sale on Amazon is a pair of 1985 Air Jordan sneakers ($48,788 + $4.49 shipping) and a baseball featuring Lou Gehrig’s signature ($71,264.99, with free shipping!). Amazon got into sports memorabilia in 2012, and it has a section for entertainment collectibles as well.

Wine
The Amazon Wine marketplace was introduced in 2012 in about a dozen states, with shipping on up to six bottles priced at a flat $9.99. The service has since expanded for delivery to more than a dozen other states, and the site—no stranger to price wars—has been competing aggressively on wine promotions, notably with 1¢ shipping on many orders.

MONEY online shopping

FAA Gives Amazon Permission to Test Delivery Drones

Amazon's ambitious Prime Air drone delivery service took another step forward Thursday, after the FAA gave the company permission to test its drones.

MONEY We Try It

The Easiest Way to Deal With Annoying Online Shopping Returns

Shyp
Jamie Grill—Getty Images

Pay somebody else to deal with them. That's the premise of an app called Shyp. MONEY tested it out

These days you can outsource even the most mundane chores—at a price point that isn’t out of reach for the average Joe. And a host of new web-enabled services have made the process a snap. MONEY asked freelance writer and busy working mom Cybele Weisser to try out some of them to see if the time they bought her was worth the price she paid. This post is part of a series recording her results. In future posts she’ll try out online personal assistants, grocery delivery, meal planning kits, and more.

The Chore: Shipping Packages

My love for Internet shopping is greatly eroded by my hatred for its inevitable byproduct: having to pack up returns and take them to UPS, the post office, and FedEx. Sending toys my kids outgrow to their cousins results is the same time suck and then some, since we never have the right size box.

→ Outsourcing options: Shipping and delivery apps, such as Shyp, Postmates, and Shipster, have proliferated in urban centers like New York City and San Francisco. Those outside metro areas can use all-purpose outsourcing site Taskrabbit but will pay more.

→ What I tried: Shyp

→ What it cost: $5 fee to pick up, pack up, and ship 10 pounds of toys to the cousins, plus a $13 charge from the U.S. Postal Service.

→ Time saved: 45 minutes total—15 to find and pack a box, 15 trekking back and forth to USPS, 15-plus minutes waiting in line.

→ How it worked: I pressed “add shipment” on the app, gave my address and delivery info, and uploaded a photo of what I wanted to send. Within 30 minutes a bike courier arrived at my door with a big white bag, placed my goods inside, and left for a central van where Shyp packs up the goods and finds the best price among shippers (the company gets bulk discounts, then marks up to allow for a profit margin).

Another half-hour later, I got a text with a link to a USPS tracking number and a receipt.

→ The verdict: Totally worth it.

I might have been able to send the package a bit cheaper if I’d gone to USPS on my own ($10 according to an estimate I got), but I didn’t have to buy a box and I saved a lot of time. Shyp says it guarantees shipments up to $1,000, but I might still hesitate if my items were precious or personal.

 

MONEY Odd Spending

Snuggie Maker to Pay $8 Million Over Customer Complaints

The makers of popular “as seen on TV” items like the Snuggie have agreed to an $8 million settlement over deceptive business practices.

MONEY Shopping

5 Ways Department Stores Are Fighting For Your Business

Sears store in the mall
Keith Beaty

Macy's, Target, J.C. Penney, and other stores are getting creative in their quest to boost sales, or at least stay alive and relevant, in an increasingly crowded and complicated marketplace.

The all-purpose American department store is “dying.” We’ve heard this for years, to the point that the retail category is not unlike the old man in the classic Monty Python scene who is loaded up on a cart of corpses despite his protest, “I’m not dead!”

Yet while we’ve witnessed the collapse of Radio Shack and various teen fashion retailers, as well as the larger struggles of malls as a whole, the old-fashioned department store is, well, not dead yet. In fact, this week, a round of earnings reports revealed generally good sales performances in the fourth quarter—and during the all-important holiday period in particular—from Dillard’s, Target, and Kohl’s, among others. Sears sales were down for the 11th quarter in a row, but even its report was viewed as decent because the company lost significantly less than it did in the same period a year prior. J.C. Penney surprisingly posted a loss for the quarter as well, though comparable store sales were actually up 4.4%.

Even with the mostly positive earnings reports, Target’s failed expansion in Canada, as well as the trend to shutter more and more Target, Sears, Macy’s, and J.C. Penney stores in the U.S., demonstrates that while department stores are alive, they’re hardly kicking butt.

To avoid being written off for dead alongside Radio Shack, here are a handful of strategies you’re going to see more of from department stores:

Trying out new store models. This week Macy’s announced intentions to create a new off-price retail brand that would compete with discounters like TJ Maxx and highly successful “fast fashion” chains such as H&M and Forever 21. Meanwhile, Kmart is testing out a smaller store format, and Target is expanding its “Express” small-store model to more markets. Walmart has been going small too, with more non-supercenter “market” locations. Overall, the strategies show that the large department stores and discounters acknowledge that the one-size-fits-all approach is flawed, especially when the size in question is a hulking big box store.

Pushing web sales hard. Target offered free, no-minimum-purchase shipping for all online purchases throughout the 2014 winter holiday period. The move helped long-struggling “Tarjhay” increase digital sales by 30% for the year as a whole. Now it looks like Target is doubling down on its e-retail offensive, with this week’s decision to cut the minimum-purchase threshold for free standard shipping from $50 to $25—a change that undercuts Amazon, Best Buy, and Walmart, among others.

For its part, the world’s largest retailer is well aware that more shoppers are “omniconsumers” who make purchases via all channels, and it’s trying to win their sales at every turn. “No doubt business is going increasingly mobile and increasingly online,” Walmart CEO Doug McMillon told the Associated Press recently. “We don’t really care how the customers want to shop. We want to be in the position to serve them in any of those ways.”

Going old school with marketing. While virtually all retailers are seeking to juice web sales to compete with the likes of Amazon, J.C. Penney is trying to achieve this goal in an old-fashioned, seemingly unorthodox way. Starting in March, the department store that’s undergone several (mostly unsuccessful) makeovers in recent years will start mailing its oversized catalog to customers yet again. And one reason why they’re using this tool is that consumers are more likely to order merchandise online with a catalog in front of them.

Going invasively new school with sales pitches. Macy’s, Neiman Marcus, and Lord & Taylor are among the major retail chains that have taken the potentially creepy step of deploying wireless beacons that detect shoppers’ precise locations inside stores and send them info via smartphone about discounts, promotions, and special events.

Discounting in ways old and new. Discount-heavy Kohl’s, where you can “save” $2,136 on a $242 shopping excursion, and where no one in their right mind pays full price for anything, had an especially strong holiday quarter with 3.7% growth in sales, beating expectations of 2% to 3%. One thing this tells us is that the age-old sales tactic of “price anchoring,” in which “regular,” “original,” “suggested,” and “compare to” list prices are inflated so that the inevitable discounts seem all the more impressive, remains a surefire way to sucker shoppers into buying.

On the new frontier of discounting, Target is testing out a strategy from the playbooks of supermarkets and drugstore chains, quietly launched a rewards program mobile app in beta. Members get 10 points for every $1 they spend at Target, and 5,000 points can be traded in for 5% off your next total purchase at the store. For now, the program, called REDperks, is available on an invitation-only basis, and only in select markets.

MONEY online shopping

Target Undercuts Amazon and Walmart With Easier Free Shipping

Target sign
Mike Blake—Reuters

Target just cut its minimum purchase requirement to receive free shipping in half, from $50 to $25. That's $10 less than what you have to spend at Amazon or Best Buy for free shipping.

Target has a long history of being in the crosshairs of Amazon, what with the world’s largest e-retailer routinely undercutting Target’s prices, combined with a wide range of strategies to woo moms in particular away from “Tarjhay” with speedy one-click shopping. Perhaps Amazon’s most deadly weapon—causing trouble not only to Target, but nearly all brick-and-mortar retailers—is Amazon Prime, the subscription program that provides free two-day shipping, among other perks, in exchange for a $99 annual fee. Above all, what Prime membership does is dramatically increase one’s spending at Amazon.com because nearly all purchases made on the site will ship for free. And the purchases made at Amazon.com are purchases that are no longer taking place at Target, or via another retailer.

On Monday, Target went on the offensive by tweaking its own free shipping policy, with the hopes of stealing some business back from Amazon, among others. The new shipping policy, Target boldly claims, “Will Change Your Life,” presumably in ways not unlike how Amazon Prime is known to dramatically change one’s spending habits and errand schedule.

The new policy grants free standard shipping (3 to 5 business days) on all Target.com orders of $25 or more. Previously, the purchase threshold for free standard shipping was $50. The minimum purchase requirement for free shipping at Walmart.com, for instance, is set at $50, while Amazon and Best Buy offer free shipping on most orders if the total is $35 or more.

Clearly, the move gives Target a little leg up on the competition, and it could very well start a free shipping pricing war among retailers—a war that would obviously benefit shoppers. But how big of a deal is Target’s policy change really? And is there a prayer it could actually change your life?

The truth is that Target’s new policy won’t affect its best customers at all. That’s because the most loyal Target shoppers are highly likely to be in possession of the Target REDcard, a debit or credit card that providers the user with 5% off on all Target purchases, as well as free, no-minimum-purchase standard shipping on all online orders. What’s more, Amazon Prime subscribers who are happy with the service aren’t likely to be wooed away by Target.com—which has fewer items for sale than Amazon (who doesn’t?), and whose free shipping is slower than that of Prime.

The consumers being targeted by Target’s policy change, then, are those who aren’t regular Target shoppers and don’t subscribe to Prime, or those who do subscribe to Prime but have been thinking that maybe the annual membership fee isn’t worth it. Also, for Target’s offer to seem truly compelling, you must be someone who would regularly want to make online purchases of $25 but not over $35. Once you’ve hit the latter price point, after all, you can get free shipping from Amazon or Best Buy alongside Target, so Target’s free shipping is a wash.

All that said, there are probably some consumers who will view Target’s new policy as an appealing alternative to Prime and Amazon.com in general. Just as Target’s decision to offer a free non-minimum-purchase shipping promotion during the recent winter holidays gave its web business a boost, the retailer will certainly juice e-retail sales by cutting its free shipping purchase threshold in half. Some tiny portion of shoppers will probably “change their lives” by placing a few more small-money orders at Target.com now that shipping is free.

It seems unlikely, however, that the policy change will move the needle much in Target’s ongoing battle against Amazon, nor will it cure Target’s larger problems, including its failed expansion in Canada and the fading of its reputation among shoppers and the industry as retail’s cheap-chic darling.

MONEY online shopping

Become a Better Bargain Shopper in 7 Minutes Flat

computer cursor over "sale" sign
Sarina Finkelstein (photo illustration)—Getty Images (1)

The right tools and apps can help you land the best price every time you shop online.

As part of our 10-day series on Total Financial Fitness, we’ve developed six quick workouts, inspired by the popular exercise plan that takes just seven minutes a day. Each will help kick your finances into shape in no time at all. Today: The 7-Minute Bargain Finder

Buying on the web is convenient—maybe a little too convenient! Using smart apps and browser add-ons will help you score deals.

0:00 Surf to getinvisiblehand.com. This browser extension scours the web for the best price on whatever item you’re looking at online.

0:33 Adding it is simple. Scroll to “Download Now,” and in two clicks InvisibleHand pops into your bookmarks bar.

1:03 Take it for a spin. Recently, by scrolling to an HDTV on BestBuy.com and clicking on the yellow InvisibleHand banner at the top of the page, you would have seen links to five other sites selling the TV for less.

3:06 Head to Tracklf.com, a site that monitors price changes on millions of products. Click “Install Tracklf.”

3:49 Skip the lengthy explanation video and try it out yourself. Use the “Tracklf” button to see a three-month pricing history of any item and request an email if the price drops.

5:58 Grab your smartphone and search for “PriceGrabber” in the app store. This app lets you scan barcodes when you’re out shopping and see comparisons on in-store and online prices.

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Next:

  • Day 7: Find Ways to Save More
  • Day 8: Boost Your Earning Power
  • Day 9: Learn How Better Health Can Help Your Finances
  • Day 10: Shore Up Your Safety Net
MONEY Shopping

The Curious Ways Brutal Snowstorms Affect How We Shop

The region is being hit once again by snow, and some businesses such as this T.J. Maxx store in North Andover, Mass., were closed, February 9, 2015.
Jim Davis—Boston Globe via Getty Images The Northeast was hit once again by snow, and some businesses such as this T.J. Maxx store in North Andover, Mass., were closed, February 9, 2015.

As the snow piles up in the Northeast, business suffers at many restaurants and stores, as you'd expect. But bad weather isn't bad news across the board for retailers.

We’ve seen the pattern repeat itself many times over. Weather forecasters predict a big winter storm, and long before the snowflakes appear, panicked shoppers hit the supermarkets to grab whatever milk, bread, eggs, and, if you’re at Whole Foods, kale, is still available.

Likewise, the arrival of a blizzard—or rather, the forecast that one could be coming—all but guarantees that there to be a run on shovels, sand, salt, and other snow-coping materials at hardware stores and home improvement centers. Gas stations and stores selling winter boots and other cold-weather gear can rely on storm forecasts to create sales spikes too.

In these ways, at least, the storms pounding New England and much of the Mid-Atlantic region over the past few weeks have boosted retail sales in ways not seen since, well, last winter, when the polar vortex caused mad rushes on grocery stores throughout the Midwest.

And yet, bad winter weather is hardly a good thing for retail in general. In fact, for stores that aren’t selling groceries, gas, shovels, or boots, blizzards can be business killers. Jon Hurst, president of the Retailers Association of Massachusetts, told the Boston Herald that “conservatively,” retailers in the state have lost $10 million for each day they’ve been closed or had almost no business thanks to relentless snow. Restaurant owners in Rhode Island are calling this “the worst February in years” thanks to snow keeping would-be customers at home. Overall, a 2014 IHS Global Insight study found that a single-day shutdown in New York can add up to $700 million in total economic costs, including $152 million in lost retail sales.

Presumably, the bulk of those lost sales transactions would have been conducted in person. After all, snow and cold weather can only prod more consumers to stay indoors and shop online, right? Actually, the impact of big snowstorms on online shopping is a bit muddled.

On the one hand, 16% of consumers in a recent survey from Fluent said that they have shopped less this winter, while 27% said they have done more online shopping. So snow + frigid temperatures = increased online sales, right? Not so quick.

According to Adobe Digital Index data, the winter storm that hammered the Northeast in late January resulted in a $35 million decrease in online sales, largely because people were home rather than at work. “During the work week, a lot of people really do shop from their work desktop,” Adobe analyst Tamara Gaffney explained to InternetRetailer.com. “You also have power outages and people out shoveling snow. They’re not shopping, they’re doing other things. It has a negative impact on e-commerce.”

Another way that winter storms can wreak havoc on e-retail is that when roads are impassable or close to it, it’s extraordinarily difficult for goods to simply be picked up or delivered. For instance, a Federal Express Service Alert issued this week warned that in light of persistent snowy weather in the Northeast, “some service delays and disruptions can be anticipated for inbound and outbound shipments in CT, ME, MA, NH, NJ, NY, PA and VT.”

For what it’s worth, the impact of snow—even a series of storms in a particularly bad winter—is generally short-lived. Often, if snow or cold weather brings about a slow period for sales of cars or home appliances or whatever, there will be a significant, corresponding rise in sales once things warm up. In other words, the sales shift; they don’t simply disappear.

Besides, retailers really shouldn’t go blaming uncooperative weather as the reason sales have been poor. “It’s usually one of those ‘dog ate my homework’ excuses,” Forrester Research analyst Sucharita Mulpuru told Bloomberg News last fall, when some apparel stores were pointing the finger at warm weather for why winter fashions weren’t selling well. “Whenever something can’t be explained and is an anomaly — and it happens to coincide with an unusual weather pattern — that becomes the reason people supposedly didn’t shop.”

The observation calls to mind the way that Big Beer blamed unseasonably cold weather in the spring of 2013 as a prime reason macro beer brands like Budweiser, Miller Lite, and Heineken were experiencing slumping sales. Meanwhile, Bud and other major beer brands have seen sales decrease for years, and why this is so has a lot more to do with the increasing popularity of craft beer, cider, boutique spirit distilleries, and other alternatives to pale mass-produced American lagers than it does to any bad spell of weather.

MONEY online shopping

Amazon Prime Membership Should Come With a Warning

Amazon Prime packages
Justin Sullivan—Getty Images

And the warning is: After paying $99 for your subscription, you're going to spend a ton of money at Amazon.com.

Amazon rarely releases sales data to the media. Nonetheless, the idea that customers who subscribe to Amazon Prime wind up shopping and spending a lot more at Amazon is considered fact. After all, once customers are paying $99 for the service and know that express two-day shipping is available for free on nearly all purchases, it makes sense that they’ll stop shopping elsewhere and do most if not all of their online shopping at the site. It helps, of course, that Amazon has a reputation not only for selling a huge variety of merchandise, but for having low prices as well.

But what impact, exactly, does signing up an Amazon Prime membership have on the individual’s online purchasing habits? Again, it’s hard to say because Amazon is reticent to release data. What’s more, things are complicated because the people who find it most worthwhile to join Amazon Prime are those who shop often at Amazon in the first place. (When you’re a member, the more you spend, the more you “save,” at least in terms of shipping.) So it’s not simply a matter of figuring out how much Prime members versus non-Prime members spend at the site.

Still, it’s undeniable that Prime members spend a bunch more at Amazon than non-Prime members. In a recent story by a couple of my MONEY colleagues about Apple, Amazon, and Google in terms of investing opportunities, a ComScore report is mentioned revealing that “Prime members make twice as many purchases as nonmembers, and they spend 40% more per transaction.”

Read more: Why You Should Never Buy Stuff When You’re Sad

This week, a new survey was released by Consumer Intelligence Research Partners (hat tip: Huffington Post) with some precise dollar figures regarding the topic. According to a survey of consumers who made purchases at Amazon from October to December 2014, Prime members say they spend an average of about $1,500 at the site annually, versus $625 for non-members.

Owning an Amazon Kindle is also correlated with increased Amazon.com spending. Kindle owners (who may or may not also be Prime members) spend $1,450 per year at Amazon, compared to $725 per year for customers who don’t own Kindles, according to the survey. “Similar to Amazon Prime members, Amazon Kindle owners are better customers,” Mike Levin, partner and co-founder of CIRP, said in a press release about the new report. “They also shop more frequently, and also buy more expensive items on average.”

All in all, the spending data spells out plainly why Amazon pushes sales of Prime and Kindles so hard. In particular, the world’s largest retailer has been relentless in upping the Prime value pitch by adding streaming services, producing original movies, and such. Just last weekend, for instance, Amazon dropped the price of Prime to $72 and allowed everyone to stream its Golden Globe Award-winning online show “Transparent” as a way to show off one of the perks of being a Prime member.

Read more: Amazon Is Making It Easier to Publish Your Own Kindle Textbooks

It’s no mystery that Prime membership, Kindle ownership, or both are essentially gateways that welcome online shoppers into the Amazon consumershere and result in sharply increased spending at the site.

On the other hand, there’s good reason to believe that people who aren’t Prime members are more likely to shop around and make purchases at Amazon only when it’s clearly the most convenient or cheapest option. They don’t automatically defer to making purchases at Amazon, like Prime members appear to do. And based on some recent studies indicating that Amazon doesn’t have the cheapest prices across the board, it seems wise to browse a range of retailers rather than immediately head to Amazon for a one-click purchase of your latest need.

Read next: Amazon Outbid Netflix For Its Most Successful Show

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MONEY deals

Free ‘Transparent’ Streaming, Cheap Amazon Prime on Saturday

Jeffrey Tambor in Transparent
Beth Dubber—© Amazon/Courtesy Everett Colle Jeffrey Tambor in Transparent

Amazon already has tens of millions of subscribers to Amazon Prime. But Amazon wants more, and it's using a Transparent-Golden Globes-themed promotion on Saturday to win them over.

A report surfaced last autumn estimating that as many as 50 million people were members of Amazon Prime, the $99-per-year subscription service that includes two-day shipping on most purchases and unlimited streaming of video and music content. Mind you, that was before the 2014 holiday shopping season, during which Amazon reported some 10 million new members had signed up for Prime.

Previous studies have indicated that Amazon actually loses money on Prime due to all the shipping costs incurred by frequent shoppers. Yet Prime is undeniably a powerful revenue driver for the world’s largest retailer, because of the tendency of subscribers to make nearly all of their online purchases at Amazon once they’ve paid for a membership. Hence Amazon’s relentless push to boost Prime subscriptions at any and every opportunity.

And hence the latest Amazon promotion, which on Saturday grants everyone with an Internet connection free streaming of Transparent, the ground-breaking Golden Globe-winning comedy normally only available to Prime subscribers. Besides celebrating the success of Transparent and lead actor Jeffrey Tambor at the Golden Globes, the idea of airing the show for all to see is surely also a pitch to snag more Prime members. The implicit sales pitch being: Just look at the kinds of things you’d get to watch regularly if you were a Prime member!

What’s more, Amazon is giving Prime extra appeal by knocking the usual $99 price of a subscription down to $72 on Saturday, January 24. Why 72? Again, it has to do with the Golden Globes—the most recent awards were the 72nd in history.

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