Amazon.com Inc., known for its 30 percent discount on books over $15, made life even tougher for rival Barnes & Noble Inc. and its online sibling yesterday by halving its minimum for free shipping to orders worth $25.
Part of a new three- to six-month test, the move results from consumer response to Amazon's Free Super Saver Shipping option, the Seattle online retailer claimed. The latest test comes just two months after Amazon dropped the threshold for its free-shipping offer from $99 to $49.
“We're driving efficiencies and cutting costs, particularly in our fulfillment operations, and so we continue on that path and are able to find more ways to pass on savings to our customers,” said Kristin Schaefer, an Amazon spokeswoman.
The company will decide at the test's end whether to make the $25 ordering qualifier a permanent feature.
“This is an investment, so in the short term, when we make these investments it does cost us money,” Schaefer said. “But over the long term what we see is that it drives incremental demand and unit growth, and because we're able to keep our fixed costs fixed, there are rewards in the long term.”
The Free Super Saver Shipping typically is three to five days slower than the standard shipping option on Amazon.
Barnes & Noble.com, New York, offers free shipping on two or more orders shipped to a single U.S. address. Shipping on two or more orders also is free if the items are shipped together to a single U.S. address or if the domestic standard ground shipping option is used.
Barnes & Noble's bn.com offers 30 percent off more than 50,000 new book titles. The retailer likely will be forced to match Amazon's offer not only to retain its customers, but also to attract new buyers.
The Aug. 26 announcement is Amazon's fifth price drop in 13 months. It is also the second time a threshold was lowered since the Free Super Saver Shipping option was introduced in January.
“There may be reasons to shop in the physical world, but price is not one of them,” Amazon CEO Jeff Bezos said in a prepared statement.