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On September 30, 2015, Amazon announced the launch of Merch by Amazon, a service intended to help content creators generate revenue through the sale of branded T-shirts and other merchandise items such as long sleeve shirts, sweatshirts, hoodies and PopSockets grips, designed by creators and sold, produced and fulfilled by Amazon. [9]
The economist Alex Tabarrok has argued, that the success of this promotion lies in the fact that consumers value the first unit significantly more than the second one. So compared to a seemingly equivalent "Half price off" promotion, they may only buy one item at half price, because the value they attach to the second unit is lower than even the discounted price.
As coupons have a negative relationship with time, customers with a high value of time will not find it worthwhile to spend 20 minutes in order to save $5 only. Meanwhile, customers with a low value of time will be satisfied by getting $5 less from their purchase as they tend to be more price-sensitive. [ 48 ]
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