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Wednesday, February 13, 2008 - Page updated at 03:44 PM

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Amazon.com Tests Retailer Ads

AP Technology Writer

Amazon.com Inc. is testing a new paid advertising program that will drive shoppers away from products on its own Web site.

On some Amazon product detail pages, competing or complementary items and their prices now appear in a list of text-link ads under headings such as "Available at these other websites."

When shoppers click, the advertiser's site opens in a new window.

And Amazon makes money for sending the user along _ sometimes more than if it had held onto the shopper.

Razor-thin retail margins have prompted Amazon to look beyond directly selling and shipping merchandise to customers. To stay profitable despite money-losing promotions like its unlimited free shipping program, the company lets other merchants peddle their wares on Amazon.com, then takes a cut that's richer than the margin on sales of its own goods.

The company has also increased sales of movie and music downloads, digital items that don't take up shelf space or incur shipping costs when they're purchased.

Amazon has sold sponsored links that sent customers to other sites for some time, but showing competing prices that could shoppers to a direct competitor's product is a new trick _ one that pits Amazon against search sites like Google, which aggregate prices from all over the Web.

Copyright © 2008 The Seattle Times Company

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