Amazon Tries to Lure Father's Day Shoppers With Low-Price Deals

It may be a case of loss leaders used as means to lure customers. Or they goods that are cheap to buy in bulk and therefore can be marked up sharply. Either way, Amazon.com Inc. (NASDAQ: AMZN) has launched sub-$100 promotions to attract Father’s Day buyers weeks ahead of its June 19 date.

Among the advantages of Amazon’s promotion, for Amazon, is the plan to catch shoppers early. If these shoppers buy at Amazon, they are less likely to go to retail competitors, a way to dry up demand there.

Amazon’s tactic is to appeal to those with modest budgets. A high-speed modem for $89.93. A blood pressure kit for $64.99, a means to get older people or those with health problems. A Bluetooth tracker for $24.99. A wireless headset for $69.99.

One of the most notable aspects of the gifts is that each can be shipped free, if customers are members of Amazon Prime. Amazon gets a customer to take a $99 Prime upgrade for the free shipping, free data storage, song listening, premium TV and movie streaming service, which likely “tethers” people who are Amazon customers, even if they are only at the e-commerce site for the first time. Prime members are Amazon loyalists.

The less than $100 program is placed next to a “hobbiest” section, which is filled with much more expensive gifts, from a $1,299 drone to a $499 camera. If Amazon can get Father’s Day customers to click in the right direction, they are suddenly in a section of the site where the e-commerce company sells a number of high-priced products.

The sub-$100 gifts are, in many cases, not just sub-$100 gifts.