Is the loss leader a thing of the past? An opinion piece in this week’s issue argues that, in the wake of the CMA’s report into the Which? super-complaint, a new internet-inspired transparency will render the deliberate obfuscation of retailer-led pricing promotions redundant.
So will the imminent arrival of Amazon Fresh deliver this internet-inspired transparency?
As usual Amazon won’t say a thing about the rumoured launch. But even if its initial trials are expected to be low key, no-one should doubt its intent. The only question is: what will be the measure of its success? Online grocery retailers in the UK are regularly beaten up by the City for their failure to make a profit. But Amazon never make any money. On anything.
They also fail a lot. They pulled out of DVD rental. Made a pig’s ear of France. They can’t do fashion. Amazon phones bombed. Yet Amazon is feared precisely because profit is not the measure of its success. It is only growth. That makes Amazon the biggest loss leader of all. And it’s a loss leader that definitely won’t go away either.