Friday, December 9, 2011

House of Cards: Predatory Shipping

As I have been playing Magic lately, I have also been adding to my Magic collection.

One of the more daunting problems in accumulating Magic cards is the cost of obtaining them. It seems that various distributors of Magic card singles have pricing schemes which are suspect. Some Magic sellers choose only to cater to the rich players. The pricing of singles tends to be fairly high. I have seen cards selling for ten times their market value in some circumstances. People who sell at these prices are not catering to everyone. The effect of the price inflation creates artificial barriers to effective competition from low cost single alternatives and incentivizes the purchase of premium products.

Still, there are hidden mechanisms at work that may not be nearly as apparent as the outright price gouging that can occur in Magic card sales. Strangely enough, shipping is one of them. I have encountered shipping schemes that seem outright predatory in their characteristics. A merchant may overcharge for shipping until you reach a certain dollar amount. Let me be clear, I am not talking about sellers who charge actual shipping cost and then waive it after a certain dollar amount in purchases is reached- I am focused on those that overcharge for shipping and then waive shipping charges when a threshold purchase amount is reached. Predatory shipping in Magic the Gathering occurs because people who make smaller purchases overpay for shipping while people who buy more qualify for free shipping and will pay nothing at all for shipping.

Let's say you play in a group of 6 players. One player makes a purchase of $50 and qualifies for free shipping. The other players each make a purchase of around $6.50 and are charged $2.50 for shipping- but the actual shipping costs are only $1.71. The five players who are overpaying for shipping are basically subsidizing the sixth player. Again, there is nothing wrong with charging the actual shipping costs or waiving those costs if a purchase threshold is reached, the problem lies in cases where there is a shipping overcharge.

In order to protect themselves, players should always be acutely aware of shipping policies and practices. Be on the look out for packages which ship with bar codes instead of stamps or clearly identifiable prices on the envelope. Sellers may conceal the price of shipping because they know most people will not check to see what they actually paid for shipping against what they charged for shipping. Most shipping rates can be determined by searching online or even visiting a post office to inquire about the actual costs.

What can players do to avoid being a victim of predatory shipping policies? Players can delay making purchases until they qualify for free shipping. Players can, of course, purchase cards as a group to meet the threshold purchase requirements. Nevertheless, players lose the ability to build decks that can surprise their friends this way. In addition to that, those techniques only means the players themselves avoid victimization and not necessarily other Magic players. The final option is that players may simply wish to avoid doing business with businesses that engage in predatory shipping practices.

Hopefully, you can find a Magic reseller which does more than simply cater to the rich or one that preys upon the poor. Once again, gaming is not what it used to be, a hobby. It's a business sadly and the only thing that will save games from the businesses is a basic sense of fair play between the gamers themselves.

Owing to a discrepency between an invoice that charged more for ground shipping than the postage should have cost, I contacted AdventuresOn about their shipping policies and practices. According to AdventuresOn, "If we were able to pay less in shipping we would obviously charge our customers less. We want to have an incredible combination of cheap shipping and inexpensive cards." AdventuresOn also stated that, "Our shipping charges should cover the postage, as well as packaging material. Our system estimates the postage amount by the approximate weight of the items, the destination, and the method of shipping selected."

I pointed out to them that the invoice only stated there was a charge for "shipping", not "shipping and handling". I also feel that the underlying card prices reflect cost plus profit in most cases. AdventuresOn also noted that they had to use larger envelopes for shipping with toploaders, but I explained to them my order came in a standard sized envelope.

Finally AdventuresOn replied with this response:

"Our experience is that with using the 'letter' class mailing rates for larger number of cards "approx 8 cards or more" they arrive with postage due. Or they get returned to us. My research in the past has led me to believe that the problem is the thickness.reaches over 1/4" so it moves the package to the "Flats" (2.1 General Definition of Flat-Size Mail) rate structure."

I sent them a video reviewing their shipping policies and practices, I received the following email:

"I have spoken with the owner and he has authorized a refund of your shipping cost on your most recent order ($2.50 refund should appear in your paypal account within 4 business days) and we are reviewing and updating our website and making any changes needed to reflect that the Shipping charge is our closest approxamation to actual postage, but that any overages should be viewed as handling and materials charges."

A few things should be noted: the overcharge was not actually $2.50. According to the post office, the overcharge (on my most recent order) would only have been 79 cents. I sent them a follow-up email correcting this.

(The order which began the discussion and triggered the investigation was referring to was a charge of $1.00 on what should have been 64 cents in postage.)

I appreciate the fact that they are open to reviewing their policies and practices and hope that the new shipping charges will be more equitable.

Pending this discussion, I should also disclose that I placed a new order with CCGHouse. My guess is it would have been cheaper to purchase from AdventuresOn, but in light of my investigation, I felt there were equitable considerations that justified paying slightly more for the cards. Here is the video of my investigation:

An MTGSalvation Moderator removed the link to this story.

The full email exchange with customer service can be found here.

AdventuresOn's indifference to my purchasing preferences, created the opportunity to explore purchasing from many alternative vendors including CCGHouse, AllCCG, Troll and Toad, Magic Inferno, Ideal808, and White Lion Games. Update: It appears that AdventuresOn now provides free shipping on orders over $19.99.

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