Add to Cart to View Price

Question

On e-commerce sites (such as Amazon and Newegg.com) pricing in some products will be hidden until you click a link to display the price in a modal/popup, or you are required to add the item to your cart to view its pricing.

I'm curious about what the reasoning behind this is and what impact this could have on customers and users of the site?

I've read that sometimes this is due to the seller's pricing not being in line with the Manufacturer's recommended pricing and therefore can't publicly display their price, is this always the case? Is this pattern for other purposes, and if so what would those be?

Answer 1

It's explained in Amazon's website, in this page Why don't we show the price?:

Retailers like Amazon have the legal right to set their own prices independently, but some manufacturers place restrictions on how those prices may be communicated. Because our price on this item is lower than the manufacturer's "minimum advertised price," the manufacturer does not allow us to show you our price until you take further action, such as placing the item in your shopping cart, or in some cases, proceeding to the final checkout stage. The steps required depend on the details of the manufacturer's minimum advertised price policy. Taking these steps allows Amazon to show you our price consistent with our goal of always offering you the lowest possible prices on the widest selection of products.

This won't require you to purchase the product. You can easily remove it from your cart if you decide not to buy it.

We realize that this is an inconvenience and are regularly working to educate manufacturers on how their policies impact our customers. We welcome your comments and suggestions in our forum on this topic.

This is certainly a not user-centered design decision, and as such, is bad for the overall user experience, there are two disadvantages that stem form this decision:

1. The price information (which is probably the most important piece of information after the product name) is hidden two-three clicks away
2. You loose the ability to do price comparisons for product categories that include these type of products, either in the same site or through other comparison sites.

Answer 2

I worked for a certain large online retailer for several years. I can tell you there's a continual back-and-forth going on between retailers and manufacturers on the issue of Minimum Advertised Price (or MAP). It's literally discussed at almost every meeting with a manufacturer. A few years ago, letting customers click to see the price instead of adding to the cart was quite a controversial idea among manufacturers, let me tell you.

Retailers want to show the price to consumers as early and often as possible, and they want the flexibility to aggressively discount when it serves their purposes, even though this cuts into their margins. The main motivations: matching a competitor's price or needing to reduce inventory.

Manufacturers, on the other hand, believe that advertising their product below a certain (totally arbitrary) price threshold will degrade the perceived value of their products and ultimately degrade their entire brand. They're quite superstitious about this. They constantly talk about Price Erosion - more on that later. In essence, manufacturers try their best to maintain artificially high prices on their products for as long as possible, and one way to do this - they think - is to keep perceived value as high as possible by hiding prices. Convoluted logic for sure.

Retailers are not legally required to hide the price, but as you might imagine, continually defying manufacturers' wishes does lead to repercussions. Amazon, Newegg, and the rest know that hidden prices are a bad customer experience so they try to strike the best balance they can. Lately, that's taken the form of click here or add to cart to see the price.

SIDE NOTE:

Price erosion is a natural phenomenon during the lifetime of many consumer products, unless supply is constrained or demand stays high. Some companies have built such strong brands that they rarely need to worry about soft demand. This makes their products virtually immune to price erosion, and as a result they don't need to hassle retailers about MAP. Apple is a prime example. Retailers rarely need to cut prices on an Apple product in order to get it moving off the shelves. Why? Apple has a reputation for high quality and better overall user experience compared to the competition. It turns out people are willing to pay more for this. Shocking, I know ;-)

EDIT: Hiding Price to Increase Demand

There are actually times when this will work for a little while. Usually on products that have a lot of price volatility. The theory is that we've gradually acculturated to think hidden prices imply higher value. But it's the exception to the rule. As a manufacturer, you're much better off building a good product than trying to play little games with the price.

Answer 3

I would imagine it is an important repercussion of allowing stores to set their own prices, as users here mentioned, that provide a way for online sellers to avoid crawlers like Google shopping or Bing's discount finder. While of course most sellers would want to advertise their lowest price (like Walmart or Target do) other smaller stores that sell at their own price (possibly borderline illegally) want to avoid any hassle and therefore prefer to hide their pricing. Like Marcos says above, its certainly not a user-centered design decision and seems highly unlikely to drive up sales rather than hurt it.

Answer 4

Websites do this for multiple reasons, but I assure you none of them do it from a usability point of view.

I have friend on one of the websites that does that (none of which you mentioned) and he says that sales drop on some items if they display the price for certain items.

However, other prices are not displayed because of the "minimum advertised price". Basically sellers prohibit amazon and others to display a price under a certain threshold for a particular item. The workaround is not to advertise it and show it once you add it to the basket. This also prevents search engines to catch them when they crawl the web.

Answer 5

There are two aspects of this pricing practice.

1) as discussed in the page, there would some legal bindings which will hold ecommerce stores displaying reduced price upfront.

2) There are few stores using this feature to improve their conversion even. When a price is hidden or striked out buyer might have a curiosity if he is really interested in knowing price. And after adding the product to cart they may feel a sense of urgency to buy the product at given price. There are various options we have developed for our customers like showing price after adding the product to cart, call for price, show price after login, show price after entering may be a specific voucher value etc. Depending on the products and target customer, every of these might have its own impact.