Earlier today I pooh-poohed the Chase Freedom's earning of 5 Ultimate Rewards points per dollar spent at Amazon.com in the 4th quarter of 2015. While I do make purchases at Amazon.com occasionally, especially since I generate a small amount of Amazon gift credit each month using Amazon Allowance and microhacking, I don't consider myself a regular Amazon shopper. Since I know many of my readers are, I thought I might as well explain why.
"Free" shipping is now standard almost everywhere online
Obviously shipping is a cost of doing business for any online merchant selling physical goods, so it's not clear in what sense shipping can be "free:" it's included in the prices of the goods you order for delivery.
On the other hand, the included shipping that's now standard in online pricing makes those prices easy to compare, where they hadn't always been in the past, when Amazon first started offering free shipping on orders for their Prime members.
Amazon only occasionally has the best prices
To qualify for free shipping, orders have to be either sold or fulfilled by Amazon (although of course some Amazon Marketplace sellers also include shipping to compete more effectively with Fulfillment by Amazon sellers).
Here are some things I've purchased online in the last few months:
- Dockers trousers. $35 on Amazon.com, $35 on Dockers.com;
- Culligan Filter Replacement Cartridge. $12.67 on Amazon.com, $14.99 on Culligan.com;
- Mr. Coffee 12-Cup Replacement Decanter. $10.97 on Amazon.com, $7.99 on Ebay.com.
In other words, sometimes Amazon is the same price as other merchants, sometimes it's more expensive, and sometimes it's cheaper. There's no inherent savings when shopping on Amazon.com.
Amazon restricts portal cash back
Last year I wrote that I was pleasantly surprised to earn cash back shopping at Amazon.com after clicking through TopCashBack, since at the time Amazon was paying 8% cash back for purchases in their "Men's Fashion" department, which happened to be where I was shopping.
The flip side of that is that Amazon regularly changes which departments earn portal cash back ("Star Wars Toys" is a current cash back category).
Actual online merchants like Dockers.com tend to have relatively stable, relatively high payouts: currently 5% cash back through Discover Deals, which rises to 10% cash back if you enrolled in time for the current 12-month double cash back deal.
Thanks to our brothers in the reselling game, every travel hacker has at least a general idea of how cash back portals can save money on actual purchases of physical goods. What they may not realize is that those portals can bring prices down well below the supposed savings offered by Amazon. Even better, sites like evreward and Cashback Monitor make it easy to compare the relative payouts from a wide range of shopping portals.
So by all means, shop at Amazon. But it's always worth a quick glance to find out whether you can save more money at one of the thousands of online merchants Amazon is competing against.