The fundamental problem of selling things was always that you had to set one price, unless it was a big-ticket thing that people haggle over. With one price, it's too high for some people, so you lose the potential profit from selling to them at a lower price, and some people buy, but would pay more, so you lose the extra profit from charging them the maximum it is worth to them.
Being willing to donate during a transaction is a valuable hint that you would pay more if you had to.
I've been avoiding Amazon for a while, but I wanted a product recently that was only on Amazon, and as I clicked through the shipping options, and refused Amazon Prime for the nth time, they jacked up the price by like $5. So I abandoned the order. But I guess their techniques work at scale.
My hope is that somehow, their algorithms to discriminate in pricing cause them to self-destruct eventually. In the meantime, I think this is a major part of the dynamic making people feel, and be, poorer - during the past decade there has just been a revolution in eliminating consumer surplus and converting it into producer surplus, and that's where all the corporate growth/wealth is coming from.
I don't get this. How does using amazon smile signal that I'm willing to pay more? The prices are the same as the regular site and the donation money is coming out of amazon's pocket.
But as far as Amazon goes, how do you determine the prices are the same? It seems to me they change from second to second, and presumably from person to person. Do you ever buy the same product at the same time using both methods?