The Answer is LOW Transaction Costs
The "Exchange" option on Amazon works almost like barter, but at MUCH lower transaction costs!
A guest post from the YYM:
A couple weeks back I bought a pair of shoes on Amazon. They were a brand new pair of shoes, Brooks, and were sold through Zappos on Amazon for $120. They were delivered quickly, and came from Sheppardsville, KY. I wore the shoes on two separate walks on the road and realized I did not like them. I decided to try out the Amazon return policy, which stated they could be returned as long as they were still in new condition. They had small bits of mud in the grooves, but I thought I'd give it a shot.
I cleaned the shoes thoroughly with a toothbrush, and afterwards they showed no visible wear to the point where if I were to pick them up in the store I would not say they were used. The Amazon return options online said I could either package the shoebox in another box and bring it to a UPS store where they would put a shipping label on my packaged box, or bring the shoebox to a Whole Foods where they would actually box up the shoebox for me. I chose UPS because it was closer.
So I put the shoes back in the shoebox, and put the shoebox in a cardboard Amazon box I had leftover from Christmas. I chose to receive my refund in the form of Amazon credit instead of refunded to my credit card, because I figured I'd need to use Amazon again soon and the refund process clarified this option would be faster than refunding to a credit card by 5-7 days.
I arrived at a UPS store at 10:30am with my box, and held out my phone to the employee in the store. He scanned the barcode Amazon had provided me for return, nodded, took the box, handed me a receipt and wished me a good day without so much as asking what was in the poorly taped together re-used Amazon box.
At 12:30pm, two hours later, I received an email that my refund had been processed and that there was $120 in my account. I was shocked. Who visually inspected these shoes in that 2 hour window and decided they were worthy of the full $120 refund? Was the speed of this transaction only possible because of Amazon's ownership of Zappos? Even if they did accept these shoes as being in "new" condition, the tags were cut off and the tongue stuffers were tossed, so do they intend to repackage/restock these and try to re-sell these as new or did I cause this pair of shoes to be listed for sale under a "used" status or possibly even thrown away?
Did the fact that I very rarely return Amazon items and am a frequent purchaser mean the condition of the shoes didn't even need to be verified at all and was the refund pushed through sight unseen? Was it possible I had received someone else's toothbrushed shoes and accepted them as new and never worn?
I arrived home and realized I had forgotten to buy coathangers. And I also that I needed a bag of dried mangos (sometimes, you just need things; it happens). I found these products on Amazon, each with a next day 7am-11am delivery window. They were both delivered at 6:45am the following day for a total of $40 credit.
Within less than 24hrs, I had effectively bartered running shoes for coathangers and mangos with a $80 credit remaining. The resources I had used were the new(ish) pair of running shoes I didn't like, a cardboard box, my time, and the costs incorporated in the drive to the UPS store. The idea of in-store credit isn't new, but the logistics and coordination involved for these three separate products were impressive.