Pixel Envy

Written by Nick Heer.

The Hidden Price of Convenience

Victor Luckerson writing for the Ringer on the hidden fees within Uber-style apps and services:

[…] A growing number of apps that fulfill an ohhhh, I really want rather than a basic I guess I need are masking their pricing structure in hopes that users will mash “I accept higher fare” on their phones ever faster, regardless of the price tag’s details. Postmates, for example, connects consumers to couriers who will hand-deliver everything from a panini to an Xbox. You just have to pay tax, a 9 percent service fee that goes to the company, and a delivery fee that varies based on distance to pay the courier (who is a contract worker, not an employee). And you’re supposed to tip. And, sometimes, there’s Uber-style surge pricing. Add it all up and you get a nightmare known as a $26 Chipotle burrito.

David Streitfeld writing for the New York Times on Amazon’s deceptive pricing practices:

With a majority of Amazon products, the presentation of a bargain used to be front and center. Take, for example, the Breville Infuser Espresso Machine. A few months ago, Amazon said this was an $800 machine that it was offering for $500, a discount of 38 percent.

[…]

The problem with list prices or, as they are sometimes called, manufacturers’ suggested retail prices, is that they are regularly more of a marketing concept than what anyone is actually charging. When Amazon was saying the list price of the Breville Infuser was $800, Breville itself was selling the machine for $500 — about the same as Amazon. Other retailers sell it for $500, too. Breville confirmed the price was $500.

We are, of course, willing to pay for convenience and efficiency. But both of these authors raise a good point: this pricing should be transparent and known to consumers.

Uber’s recent decision to bury the amount by which they’re increasing the fare during “high demand” makes it hard for users to know whether it’s a reasonable deal. Of course, we may well choose to take the Uber instead of a cab, even if it costs far more, but we should be fully aware of how the rate is calculated. Similarly, Amazon’s displayed list price should be reflective of the actual list price for the item in stores, not a hypothetical number.