Shared Reading: Good Marketing?


Remember last week when Amazon was selling Lady GaGa's new CD for only $0.99? Well, it turns out that Amazon took the lose as a marketing expense.
Amazon paid Interscope’s distributor, Universal, the full wholesale price for the album — between $8 and $9 — and accepted the difference as a loss, according to several people briefed on the sales arrangement, who were not authorized to speak publicly about the details. Billboard reported that Amazon’s two-day sale yielded about 440,000 digital sales; if correct, that would mean that the retailer lost more than $3 million on the promotion.
So while we were getting a great deal, we were also offering Amazon tons of advertising. How many of you shared the deal with a friend? How many of you stayed on Amazon and purchased more music once you saw that they were cheaper than iTunes? That was their goal.

While no one at Amazon confirms this information, it is assumed that while they lost money on the actual sale of Born This Way, it will generate future sales on Amazon.

Any thought? Leave a comment.

Source: New York Times


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