Amazon started its business in the form of a website, and its customers
are visitors and potential visitors to the Web site and its competitors’ sites
(Kyle, 2002). One of the advantages for the business to take the form of a
website over conventional retailing approach is to minimise the running cost
of renting and opening stores to sell books, and hence the books they sell
can be priced lower than other non-website competitors to balance out the
postal fee expenses. Another important advantage is to provide a 24-hour,
with no physical location limitation and customisable book-search service to
customers. The effectiveness of this selling model yields savings on auxiliary
costs (such as transportation time and costs) and hassles, where buyers
may become less price sensitive to postal fees of different delivery options
and even minor price gaps of the books with all these advantages are taken
into account.