Amazon Won't Profit From 'Harry Potter'

Amazon.com Incorporated has taken more than a million pre-orders for the final Harry Potter book due out in July, but according to Chief Executive Jeff Bezos, the world's largest Web retailer won't make a profit. Amazon's handling of the "Harry Potter and the Deathly Hallows" release comes down to a $17 discount off cover price, a free shipping offer and guaranteed on-time delivery. The company is once again demonstrating that it is willing to take a hit to cement customer loyalty.

Amazon sacrifices $600 million in shipping revenue each year, thanks to the $79-a-year Amazon Prime free shipping membership available in the U.S. and Japan, and other shipping offers. "We are very focused on the long term, but we also believe that the long term has to eventually come," Bezos said. He noted that in the past, periods of intense investment started to pay off in five to seven years.

News source: Physorg

Report a problem with article
Previous Story

Sony CEO Howard Stringer Studying, Refining PS3 Price

Next Story

New Nintendo game gives beauty tips

18 Comments

Commenting is disabled on this article.

I wish that Amazon had a more all-inclusive gift certificate scheme. I think last time I checked, all those little dealers who use Amazon's front end, not all would take an Amazon gift certificate, thus reducing their utility.

Im in Switzerland, and I order every DVD, HD DVD from Amazon.com in the US...

but I have to pay for every shipping: $ 10.48

but it is the best Service I get the DVD in less then 7 Days..!!

if you're ordering DVD's and HD-DVD's why aren't you ordering from play.com they send form the c hannel islands so it's cheaper, they send with free shipping, and you generally have it about 2 days after it's shipped. They even pack every dvd orered separately so those of us living in countrys with crappy taxes on imports above a certain amount don't have to pay

I pay £1.24 for all cd's I buy P&P.

The Swiss government I think are taking a huge cut.

I purchased a Frank Sinatra cd brand spanking new for 1 pence, so total cost to me was £1.25.

$10.48 is robbery.

Amazon is great until you have a problem/dispute They suck at fixing stuff (at least did for two different occasions for me)

Thats unfortunate, I've only dealt with amazon.com once I never had a hitch. I ALWAYS buy my books though from Amazon.ca and had a dispute once and it was smooth sailing, different management teams?

I ordered the last Harry Potter book from Amazon when it was released under this same promotion, and when I still didn't get it by Monday, I reported it and they overnighted me a copy for free and refunded me the entire purchase.

I don't know why people think things like this are some sort of rare business practice. Its very commonplace in fact. Many retailers make no or actually loose profit on new release items to get people to their sites and stores. Once they are there, you try to attach other, more profitable items, or just to get them interested with your business.

They aren't trying to be nice, or doing anything special. They are just being a smart business.

I think Amazon is one of the very few retailers who thinks about their first and then about their profit... You don't often see a company like that! Keep up the great work

I don't know if that is really the case.. after all, it says right in the article:

We are very focused on the long term
Small retailers though may have a problem with this as they would probably not afford to keep up with such discounts

Does not matter if they do or they don't due to they send you £150 worth of money off vouchers on purchases.

Amazon rocks as an etailer.

i love amazon too.
SOME things are really low priced and i love the free shipping...
i use it often for pre-ordering games, books, etc...
pre-orders usually get you really great deals on amazon :)

Glassed Silver:mac

Amazon is great, they are my first stop when looking for items. Ill take the Seller shops in Amazon over ebay anyday for games and music.

The only problem is that I want some e-coupons for other stuff instead of durgstore.com