Online Retailer Ups the Stakes for Local Shops (sort of)

Last week, Amazon announced version 1.2.1 of its Price Check mobile app—an update that pushed the conversation around online retailer competition into an entirely new spotlight. The premise is simple: while shopping in a local store, you can scan a barcode or enter a product name into the app to find Amazon’s price. The twist? Amazon also asks you to submit the price you’re seeing in the store to help them “ensure our prices remain competitive for our customers.”

To sweeten the deal, Amazon offered shoppers up to $5 off their Amazon purchase—three times. The move was bold, brilliant from a pricing-strategy perspective, and deeply unsettling for local shops that already struggle to compete with online giants. The backlash was immediate and intense.

As Josh Constine wrote in his TechCrunch article “Use PriceCheck and Screw Local Retailers”:

“The app is designed to get you to visit local shops, try out a product, submit valuable pricing data to Amazon, leave without buying anything, and make your purchase on Amazon instead.”

He continues:

“It also promotes show-rooming where users get the benefit of checking out a product in person, but then neglect the shops that pay overhead to offer that service.”

A Wave of Public Outrage

The number of bloggers, news outlets, and everyday consumers weighing in was staggering—many calling the strategy predatory, unfair, or unethical. Some even called to “Occupy Amazon.” A few headlines included:

• “Amazon’s promotion – paying consumers to visit small businesses and leave empty-handed – is an…” (shortformblog.tumblr.com)
• Bob Negen of WhizBang! Retail Training Says Amazon.com’s December 10 Price Scan Promotion has Landed them on Santa’s “Naughty, Not Nice” List (prweb.com)
• Amazon Price-Check App Is Attack on Small Stores, Snowe Says (businessweek.com)
• Amazon Will Give You 5% Off for Price Checking Saturday: But Is It Fair? (wisebread.com)
• Brick-and-mortar retailers cry foul over Amazon’s latest promotion (knoxnews.com)
• Furor surrounds Amazon’s comparison-shopping app Price Check (nextlevelofnews.com)
• Amazon Price Check app draws protests from some retailers – Chicago Tribune (chicagotribune.com)
• Occupy Amazon! (readingacts.wordpress.com)

Even the political world took notice. The Puget Sound Business Journal reported:

“U.S. Sen. Olympia Snowe (R-Maine). Snowe is angered over the Amazon app, calling it ‘an attack on Main Street businesses that employ workers in our communities.’”

The Bigger Picture: It’s Not Just About the App

It’s easy to paint this as a new threat to local shops—but the truth is more nuanced. Yes, the app makes showrooming easier. Yes, it collects competitive data. But the reality is that those who use local stores to examine products and then purchase on Amazon were already behaving that way. This just streamlined the process.

The bigger truth? Most local shops have never competed on price—and shouldn’t try to. The era of being the low-price leader ended when Walmart arrived, and it ended again when Amazon entered the marketplace. Competing on price today is a losing battle.

What this app really highlights is something deeper: we now live in a smartphone society where product pricing is available 24/7. The Price Check app didn’t create this behavior; it simply made it more visible.

What Local Shops Must Do Now

If you’re a local retailer, the decision is no longer whether you want to compete on price. The decision is whether you choose to:

• Stop trying to be the low-cost provider
• Focus on a different kind of value—experience, service, expertise, convenience, or community

The path forward for local retailers isn’t price; it’s differentiation. When a shopper can buy anything online, the thing they can’t buy is you—your people, your story, your service, your expertise, and your relationship with the community.

Amazon’s Price Check app didn’t change the rules; it exposed the rules we’ve been operating under for years. And for small businesses, that awareness can be the spark to rethink strategy in ways that build stronger, more resilient models for the long haul.