Boosters love to claim that the web will revolutionise everything in socio-economic life. Nonsense. What it mostly does is rev up traditional processes to higher speed and efficiency. Yet it does innovate in some respects. The web creates markets by enabling far-flung strangers to pool their knowledge and buying power. Even better, its interactivity facilitates flexible pricing.
Put these elements together and you get the latest craze - co-buying syndicates, in which consumers bargain collectively for discounted prices on popular goods and services. One of the largest European operations is LetsBuyIt.com, which co-ordinates purchases of everything from toys to PCs across 14 nations on behalf of its members. The site has arranged variable pricing with merchants so that the more buyers who pre-commit to any bulk purchase, the more everyone's cost goes down.
LetsBuyIt imposes buying deadlines to create an auction-like shopping experience. Intriguing, but less revolutionary than meets the eye. Since the web site and wholesalers pick inventory and fix price points, what's driving prices is old-fashioned marketing hype, not genuine customer clout.
Until this changes, sites like LetsBuyIt.com are unlikely to best their off-line cousins, the giant discount clubs. And that means smaller memberships and smaller discounts.