Good morning,
Just purchased some Paizo products this morning, namely the adventure path Rise of the runelords, the flip mats townsquare that match the adventure path and campaign setting: inner sea. What I'm writing about is that all the above were less expensive at Amazon than here. I'm aware of purchasing in large quantities, getting a discount and then reselling for a discount, but Paizo has the largest quantity and thus can sell for the lowest.
I am an adventure path subscriber and thus get the 15% discount and all, but the flip mats, were still cheaper at Amazon. I'd have prefered to make my purchase here, but when I added in a large gaming mat into the mix I was well over $100 even at Amazon so I had to buy at the lower price. :(
Not complaining, just letting you know so you can adjust your prices. I can't be the only person who has noticed this. Sure Paizo still make money as you sold these books to Amazon in the first place, but simply matching their price would increase sales and placing your price somewhere between what you sell to them at and what they sell at would get you even more sales.
Just a thought, enjoying the game and want you to keep making moola so you keep cranking out the creativity! :)
Amazon has a setup that allows them to sell at a very low price. As I understand it, Paizo's own prices are as low as Paizo can tolerate and still make a profit.
Interestingly enough, this year's price increase for Paizo's Adventure Path line was the first since Burnt Offerings. That's pretty impressive considering the increase of costs associated with the production of the books in the years since the line was launched.
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Fun Fact: Amazon sells RPG books at a near-loss (or a loss, even). They can afford that, because they're making money elsewhere (eg. on % from affiliated stores, on Kindles, on shipping fees etc. etc.). If Paizo was to set the prices of their core product at the same level, they'd be dead quite quickly.
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Paizo sets the retail price for their own products, and tries hard not to drastically undercut that so that local gaming stores can still compete. Paizo is in an unusual situation as both a producer and a store- they want to set a price that people will pay, without also alienating every other retail outlet.
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Paizo sets the retail price for their own products, and tries hard not to drastically undercut that so that local gaming stores can still compete. Paizo is in an unusual situation as both a producer and a store- they want to set a price that people will pay, without also alienating every other retail outlet.
This. Even with this good will gesture, some gaming stores have refused to sell PFRPG stuff in the past due to the fact that you can get PDFs for cheaper prices here than the MSRP book prices
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Sure Paizo still make money as you sold these books to Amazon in the first place, but simply matching their price would increase sales and placing your price somewhere between what you sell to them at and what they sell at would get you even more sales.
And all the lost revenue from the books that they didn't sell to Amazon in the first place?
It does not follow that because Paizo sells some inventory at wholesale prices, they can afford to sell all inventory at wholesale prices.
Most local retail stores are not competitive in the first place. The only thing that keeps most of them in business is that they are glorified comic book shops. They have been going by the wayside for 10 years now as unprofitable. With internet sales quickly surpassing retail in this business, Paizo and other manufacturers need to look at the internet retailors as their competitors for their stores and not worry about mom and pops that are dinosaurs in this business.
OK, I see what you all are saying, but as I am not independently wealthy, I and the rest of the 99% must buy where the prices are the lowest.
If that is the plan, as it certainly appears to be, than Paizo would be better off selling thru Amazon vs. maintaining a store themselves. Advertise here, discuss here, but sell there. Once again saving money.
Though I guess by having this outlet Amazon is forced to keep it's prices at near or losing levels which is good for us. Kind of backwards logic, but works out for the gaming community in the end.
OK, I see what you all are saying, but as I am not independently wealthy, I and the rest of the 99% must buy where the prices are the lowest.
If that is the plan, as it certainly appears to be, than Paizo would be better off selling thru Amazon vs. maintaining a store themselves. Advertise here, discuss here, but sell there. Once again saving money.
Though I guess by having this outlet Amazon is forced to keep it's prices at near or losing levels which is good for us. Kind of backwards logic, but works out for the gaming community in the end.
Believe me, I understand your pain. I get most of my print stuff from the FLGS, but I have broken down and purchased from Amazon on a few occasions. I expect now that we're on a single income, I'll be doing so more often.
At the end of the day, do what you can afford and be content -- you are still supporting the industry, after all.
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Most local retail stores are not competitive in the first place. The only thing that keeps most of them in business is that they are glorified comic book shops. They have been going by the wayside for 10 years now as unprofitable. With internet sales quickly surpassing retail in this business, Paizo and other manufacturers need to look at the internet retailors as their competitors for their stores and not worry about mom and pops that are dinosaurs in this business.
This is short-sighted.
First, this has been true for more than a decade. Yet, there still exist some FLGSes. As such, they can't be only an appendix left over from an earlier era of commerce that hasn't died yet. They must provide some value. Myself, the value is the ability to browse, plus the occasional used book, plus serendipity. It's just fun to go into a game store. For whatever reason, they are still surviving even though Amazon.com has been around and undercutting them for a decade and a half.
However, FLGSes serve another important function: they're meeting spots for gamers. It's one way to bring new people into the hobby. It's a way to keep people in the hobby who might otherwise move on if they can't find a community. Whether it's PFS games, or other games (card games, pick-up games, etc), game stores tend to be a nucleation point for these.
The FLGS still serves an important role in today's ecosystem, even though by the "rational cold-blooded consumer" model nobody should be buying things from them any more, only from Amazon. As such, it's in Paizo's interest to support the FLGS, and not to overmuch undercut the FLGS.
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I buy most of my Pathfinder through Paizo as a subscription because I get a PDF copy (which you can only get through Paizo).
Miniatures I buy through MiniatureMarket.com because their price+shipping is usually better than I can get a Paizo.
For the RPG line, I usually buy a hardcopy through Amazon and buy the PDF from Paizo because doing it that way has always been cheaper than the Paizo subscription. However, Anazon has the Mythic book on preorder for something like ~$35 (MSRP is ~$40) so I don't know what's going on there.
Flipmats and such (when I buy them), I usually get at my local BAM.
-Skeld
On the FLGS front I see both sides and miss the ones that have faded away in my area. There's one left in my area and it's a major meeting spot. I hope it survives a long while yet. Though it's sister store that was very conviently located near my work closed with virtually zero warning. They cited low profits as the store did not get the level of business the other one did even though it was right across the street from a very popular mall and had housing close by.
As for buying from Paizo for the pdf, that is only of use to me if the product is small. A 100+ page document is a pain to access in pdf form compared to flipping thru a book. Saying that, I have purchased pdf's of smaller things, such as modules, because I can read them while on my lunch hour or print out maps or other handouts for my players.
The reason I started the thread was because I went to purchase a few items and saw more than just a small difference in price and wondered at it. I honestly did not think of brick and mortar stores at all. In my opinion a B&M store has the advantage of immediate gratification on it's side. So it can be a bit higher due to both lack of shipping costs and the "get it now" factor. I know that's just me because if it were really true B&M stores would be doing much better. Internet wins due to the laziness factor, aka have it delivered to my door.
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Having multiple places to sell our product is very, very important, as it allows customers to see our product in multiple locations. We *want* customers to be able to buy their product where it makes the most sense for them and their budget, whether it's Amazon, their FLGS, or Paizo.com.
Good 'nuff. I cannot argue with that. But that may mean fewer cookies for the Gninja if too much gets purchased elsewhere ;)
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I buy most of my Pathfinder through Paizo as a subscription because I get a PDF copy (which you can only get through Paizo).
Miniatures I buy through MiniatureMarket.com because their price+shipping is usually better than I can get a Paizo.
For the RPG line, I usually buy a hardcopy through Amazon and buy the PDF from Paizo because doing it that way has always been cheaper than the Paizo subscription. However, Anazon has the Mythic book on preorder for something like ~$35 (MSRP is ~$40) so I don't know what's going on there.
Flipmats and such (when I buy them), I usually get at my local BAM.
-Skeld
I follow this model exactly. The further out you order from Amazon the cheaper the book and they will drop your price if they offer it any lower between when you order and when it ships. I ordered in May and got it for 27.23$
Good 'nuff. I cannot argue with that. But that may mean fewer cookies for the Gninja if too much gets purchased elsewhere ;)
Not really. More outlets for purchase means more opportunities to customers to get our products—including people who may just be getting into the hobby. Win-win for everybody, and I get more cookies in the end. :D
LOL OK, you win. I know better than to argue with a Gninja. :p
Thanks for all the input people. I don't feel as if I'm betraying Paizo by purchasing elsewhere. There's still plenty of things I will buy here, but will listen to my wallet and buy certain things elsewhere. :)
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I follow this model exactly. The further out you order from Amazon the cheaper the book and they will drop your price if they offer it any lower between when you order and when it ships. I ordered in May and got it for 27.23$I buy most of my Pathfinder through Paizo as a subscription because I get a PDF copy (which you can only get through Paizo).
Miniatures I buy through MiniatureMarket.com because their price+shipping is usually better than I can get a Paizo.
For the RPG line, I usually buy a hardcopy through Amazon and buy the PDF from Paizo because doing it that way has always been cheaper than the Paizo subscription. However, Anazon has the Mythic book on preorder for something like ~$35 (MSRP is ~$40) so I don't know what's going on there.
Flipmats and such (when I buy them), I usually get at my local BAM.
-Skeld
It's strange to me because I ordered Ultimate Campaign about a month before it was released and it was ~$28. I don't know why the preorder price for Mythic is so much higher, but I hope it drops some before it ships to me.
-Skeld
Chief Technical Officer
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Paizo sets the retail price for their own products, and tries hard not to drastically undercut that so that local gaming stores can still compete. Paizo is in an unusual situation as both a producer and a store- they want to set a price that people will pay, without also alienating every other retail outlet.
And if we sold at lower-than-retail-price on our own site, we'd be undercutting the price that we're asking retailers to charge, and that would be unfair.
Ah, but you could match Amazon and then have members who are subscribers be below Amazon without being unfair to anyone as those members are paying for that privilege. Amazon's shipping is significantly faster than what Paizo can comfortably match and thus they would still have a certain advantage in that field.
Amazon is the biggest retailer and thus their price is the benchmark for retail, at least for online purchases. Walmart would likely be the brick & mortar benchmark.
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And the last piece of puzzle the OP is missing - Amazon doesn't buy directly from such small companies as Paizo. They take stuff from distributors, in this case Diamond/Alliance. So Paizo has actually not even any control over Amazon prices, because that's what Amazon sets against wholesale prices they're getting from D/A.
Ah but both of you are missing that other retailers are already dealing with Amazon and thus what Paizo does has zero effect on them as Amazon is way bigger.
Plus D/A's wholesale prices are based on what price they pay Paizo. They are still making a profit on the price they sell to Amazon. While Amazon may sell at little or no profit and make money on shipping charges it's still higher than the price that Paizo sold to D/A.
As for the subscribers getting things first that is not the items I'm discussing. You are completely correct, but I'm buying things that have been out awhile. I mentioned subscribers as we get discounts on many items we purchase here and thus we would actually get a price below the Amazon price, but that would not hurt retailers as subscribers do not make up the vast majority of buyers.
By the way both very good points brought up by you 2
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karkon wrote:
The Amazon price reflects their cost plus profit...
There is where everyone makes the same mistake. They assume that Amazon is making a profit selling our books. They don't. They lose money on every sale they make. Sounds ridiculous you say? Well, they make all their money from taking a percentage from third party sellers on the website. And now e-books, which surpassed print book sales recently.
Not exactly a business model that Paizo wishes to emulate. :)
-Lisa
It is a fool's errand to try to compete on price with Amazon. Instead, we try to compete on quality and customer service. If you want the cheapest prices, go to Amazon. If you want a friendly company with great customer service who gets you your product packaged nicely, then paizo.com is the place for you. Plus, if you want to help Paizo stay in business, support us by buying here. But if price is someone's only motivating factor, we just can't compete and stay in business. Now, if somebody wants to give me a billion dollars that I can put in the bank and use to cover overhead when we are selling things at less than it costs us to get them, I might reconsider my stance. :)
-Lisa
I think these quotes from the CEO of Paizo complement this threat just nicely.
You say you purchased them this morning.
With new products, you will absolutely see the value of buying direct from Paizo as you wait up to several weeks for the new product to be shipped from Amazon.
So if time is a factor at all, I'd order from Paizo.
Interesting and thanks Feytharn. Good find.
My problem is the prices aren't even close. Just one of the 4 items I just bought at Amazon was $25 vs. $40+ here even after my 15% discount. Big difference, especially when you are buying 4 items and only 1 of which is not a book.
Next shipping becomes free at Amazon once you get over a certain order total. That doesn't happen here, least not regularly.
Next orders ship within 24 hours from Amazon which almost never happens here. Friend of mine ordered a set of dice here June 24th and they have yet to ship and are not listed as on backorder.
Lastly, friendly service, I do get friendly service here, no question, but I've also always received good service at Amazon.
So while I and people like me would love to support Paizo and only purchase here we are like the CEO and do not have a billion dollars to spend as we wish. I do still make purchases here when I can, I am waiting on an order as I write this, "Airship Pirates: Under the lamplight".
Was chatting with a coworker during lunch about this and we both agreed if the prices were even close we'd both buy here vs. Amazon as we'd prefer to throw our support fully behind Paizo, but using my most recent purchase as an example, the final price difference for the 4 items was roughly $40. Enough to buy another book and get dinner.
So while I cannot argue with the CEO's statement that they cannot compete with Amazon, they can put their prices at a point where those of us who are not independently wealthy could buy here. I say this because a $15/book price difference is more than Amazon can make up on those percentages from third party sellers.
But I will stop this thread now as I must be the only non-wealthy Pathfinder player as not 1 person has agreed with me. :p
Thanks all for the interesting discussion!
Quick response, Evil Lincoln, I made the purchase the morning of the thread which was yesterday, but it was not new release items.
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Interesting and thanks Feytharn. Good find.
My problem is the prices aren't even close. Just one of the 4 items I just bought at Amazon was $25 vs. $40+ here even after my 15% discount. Big difference, especially when you are buying 4 items and only 1 of which is not a book.
Next shipping becomes free at Amazon once you get over a certain order total. That doesn't happen here, least not regularly.
Next orders ship within 24 hours from Amazon which almost never happens here. Friend of mine ordered a set of dice here June 24th and they have yet to ship and are not listed as on backorder.
Lastly, friendly service, I do get friendly service here, no question, but I've also always received good service at Amazon.
So while I and people like me would love to support Paizo and only purchase here we are like the CEO and do not have a billion dollars to spend as we wish. I do still make purchases here when I can, I am waiting on an order as I write this, "Airship Pirates: Under the lamplight".
Was chatting with a coworker during lunch about this and we both agreed if the prices were even close we'd both buy here vs. Amazon as we'd prefer to throw our support fully behind Paizo, but using my most recent purchase as an example, the final price difference for the 4 items was roughly $40. Enough to buy another book and get dinner.
So while I cannot argue with the CEO's statement that they cannot compete with Amazon, they can put their prices at a point where those of us who are not independently wealthy could buy here. I say this because a $15/book price difference is more than Amazon can make up on those percentages from third party sellers.
But I will stop this thread now as I must be the only non-wealthy Pathfinder player as not 1 person has agreed with me. :p
Thanks all for the interesting discussion!
Agree on what? Your Idea of how Paizo could lower their prices? I don't think you or I are able to tell if they could. On the Idea of Amazon being cheaper, pretty much everybody agrees. On the Idea of buying there? At least Liz Courts actually encouraged you to buy there if you want.
Actually: read some of the answers again. Many actually comment on their own limited budget, whether or not they get their stuffe at Amazon.
What we agreed on, my coworker and I, was exactly what I said, which was that if the prices were at least close we would make all of our Pathfinder purchases here.
Though your comments made me think of something I missed earlier, if Paizo cannot afford to match Amazon's prices, which I can understand, can they afford to be losing so many sales to Amazon as the average buyer would logically purchase there vs. here? That is a large revenue loss. So while I totally agree with Liz Courts' comment about having the product out there in many more places to be seen and thus grow the player base, I have to ask at what point does the improved player base revenue increase get off balanced by the lost sales revenue? Something I'm positive Paizo has looked at and probably continues to watch.
So, my questions, have answers which I will never be 100% privy to because I'm not a Paizo employee. :p
By the way, sorry if my above post came across a bit as bashing Paizo. Was not my intention just meant to point out areas of the CEO's statements that didn't make sense to me. Paizo has a great product and has already provided dozens of hours of entertainment and I'm sure will provide hundreds if not thousands of hours more in the future. :)
Unseelie, a mostly unrelated to the thread question, I see you're enrolled in every or darn near every subscription Paizo has, does your discounts for purchases stack? I ask, not to use towards the thread topic, but I have considered some of the other subscriptions, but overall cost of multiple subs has held me back, but stacking discounts could balance it out for me.
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You get the AP discount on everything, basically. What you can't tell from my subscription listing is that I regularly call in and ask Erik to cancel subs for me if a product doesn't interest me. It just so happens that they next couple of products out the door are ones I want.
What I wish Paizo would do is move the AP map folios and the AP item card decks into the AP subscription, as they're not nearly as compelling if you're not interested in the AP they're linked to.
Oh, and before I forget, PDF only subscriptions would be nice.
And a pony...
Ah, OK. Worth knowing that certain items can be canceled if they aren't to my taste. Thanks!
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Oh, another factor to consider... While Amazon has fantastic customer service, and so you know they'll fix things if a book gets damaged in shipping, Paizo's customer service is just as reliable PLUS they don't skimp on packaging.
I am constantly amazed at how well they pack my orders. I've never had to ask Paizo to replace something due to shipping damage. (Liz, please pass along my compliments to whomever deserves them).
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Oh, another factor to consider... While Amazon has fantastic customer service, and so you know they'll fix things if a book gets damaged in shipping, Paizo's customer service is just as reliable PLUS they don't skimp on packaging.
I am constantly amazed at how well they pack my orders. I've never had to ask Paizo to replace something due to shipping damage. (Liz, please pass along my compliments to whomever deserves them).
I will pass it along to the warehouse staff. :D
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But I will stop this thread now as I must be the only non-wealthy Pathfinder player as not 1 person has agreed with me. :p
Just for the record, this statement, even with the :p emote, comes off as snarky and rude. I would guess you did not mean to come off that way. However, as someone who every month has to grapple with the decision of whether to keep my subs or to cancel one or more so I can buy something else, and every year look at the posts and advertisements about GenCon and PaizoCon every year and wish I could afford the trip, even occasionally, your words irritate me.
Sorry Graywulfe, didn't mean to irritate. Honestly. But I was also a little irritated myself, that not one other person felt as I do or at least was willing to say so. Especially as anyone I've spoken to in person has agreed with me, so I guess it was a little dig at those people whole secretly agreed, but wouldn't speak up.
I too have looked at Gencon ad's in the back of Dragon mags since the '80s and the Paizocons for the past 2 years and wished I could go. And as I said above the I only have the one sub as I cannot afford anymore and to be honest really shouldn't be doing this one, but I need my little outlet.
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Chief Technical Officer
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Ah, but you could match Amazon and then have members who are subscribers be below Amazon without being unfair to anyone as those members are paying for that privilege. Amazon's shipping is significantly faster than what Paizo can comfortably match and thus they would still have a certain advantage in that field.
Amazon is the biggest retailer and thus their price is the benchmark for retail, at least for online purchases. Walmart would likely be the brick & mortar benchmark.
You have a fundamental misunderstanding of the business, I'm afraid. We can't match Amazon's price without lowering the MSRP to their price... and if we did that, they would just sell lower than *that* price—it's what they do. Amazon's price is not the benchmark—MSRP is, and Amazon almost always adjust their price to sell below it.
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Chief Technical Officer
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...if Paizo cannot afford to match Amazon's prices, which I can understand, can they afford to be losing so many sales to Amazon as the average buyer would logically purchase there vs. here? That is a large revenue loss. So while I totally agree with Liz Courts' comment about having the product out there in many more places to be seen and thus grow the player base, I have to ask at what point does the improved player base revenue increase get off balanced by the lost sales revenue?
You have an inflated notion of Amazon's percentage of sales of our products. We sell a lot of products directly, and we sell a lot of products through game stores ("the hobby industry"), and we sell a lot of products through large bookstores ("the book trade"). Amazon represents just a portion of that last group; overall, they're just a few percent of the whole.
And whether you buy it from Amazon, Barnes & Noble, or your FLGS, regardless of the price you pay the retailer, Paizo makes roughly the same: 60% of MSRP. We make 100% you buy directly from us, of course, but we have certain expectations, based on years of experience, about how much of any given product we're likely to sell through any given channel, and we budget accordingly. Which is to say that we set MSRP based on the knowledge that X% of our products will be sold direct at full markup, Y% will be sold direct to Adventure Path subscribers at 15% off of retail price, Z% will be sold at a 60% discount to hobby or book trade distribution, and so on.
I still call b$*%$&!s on the claim that Amazon is selling this stuff at a loss.
First, thank you very much for your time answering my questions, I really do appreciate it!
Responding in order of your response:
Can see your point of Amazon continueing to lower their prices as that's what they do. So no arguement there, but if you were closer in price, still above them, but closer both me and my coworker would buy here, but $25 vs. $40 is a big difference.
Don't completely agree on the second response. Borders bookstore has gone out of business. Barnes & Noble is struggling and according to a recent story they are cutting the amount of books they will carry at their stores. Everything will still be available online of course, but the walk in buy options will be limited. I think they may be in trouble as once a person goes online that person may shop around and buy elsewhere if it's cheaper. Other bookstores are struggling as well. Game stores are closing left and right, at least in the DC area where I live. So I would think, and may be and probably am wrong, but that Amazon's percentage almost has to be growing.
Still you've answered my questions and I will admit that there's definitely parts of the industry I don't understand and as a successful business you guys obviously do understand. So once again thank you for responding to my questions.
I still call b&!~~!%s on the claim that Amazon is selling this stuff at a loss.
Why? It's a reasonably common strategy in businesses who thrive on volume and market share.
Because, unless Amazon is paying distributors more than any random FLGS for their product, it doesn't add up.
I can, as a new account with Alliance, purchase Paizo product at about 53% of cover price. As my account matures and my volume increases, that price will go down slightly.
Amazon typically sells new Paizo product for 65% or more of cover price.
They're not selling the product at a loss.
There's other costs as well, of course, I don't know what those are. I just don't see why it would be so surprising. Doesn't seem any different to me than supermarkets losing money on DVDs.
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Because, unless Amazon is paying distributors more than any random FLGS for their product, it doesn't add up.
I can, as a new account with Alliance, purchase Paizo product at about 53% of cover price. As my account matures and my volume increases, that price will go down slightly.
Amazon typically sells new Paizo product for 65% or more of cover price.
They're not selling the product at a loss.
Pure conjecture on my part, but if what Vic says is true, and Amazon is not a significant percentage of Paizo's sales, it's quite conceivable that Amazon doesn't get as good of a price as Alliance... and if that's the case, they might be selling at a loss, or at least really close to cost.
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Chief Technical Officer
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You don't need to believe me; check this out.
Amazon's strategy is to bring you to their site by selling you stuff at the lowest possible prices, at no profit or even at a loss (especially when you factor in shipping and other costs). Most of their profit is coming from the cut they take on sales from their third-party shops, with a much smaller profit coming from digital sales.
Speaking of shipping, note that the shipping revenue on direct sales on that report, including Prime memberships, is $2,306,000, while their shipping expenses are $3,851,000. Meaning they're paying an *average* of 60% more to ship each package than they are charging customers. And note that because they are one of the single largest shippers in the entire country, they get the lowest possible rates to begin with.
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Chief Technical Officer
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We sell to distributors at about 60% off of MSRP (a 40% discount). The discount they offer retailers is up to them, but it's typically going to get a 10-15% markup.
The book trade *does* actually get a slightly lower discount than the hobby, in exchange for the ability to return unsold products. Hobby pays less, but can't return what they don't sell.
Ah. That might explain the 53% figure, I guess (though its still surprisingly low to me).