Amazon scooped up data from its own sellers to launch competing products • Hacker News Board

Re: Amazon scooped up data from its own sellers to launch competing products

#161

Post by dd36 » Thu, Apr 23, 2020, 4:26 PM UTC

thoraway1010 wrote: post #123

whoisjuan wrote: post #17

Stating the obvious I guess. All retailers do this and create their own white-label brands to squeeze profit from well-performing categories. Target, for instance, is very upfront about it and they have like a gazillion white-label brands that compete in hundreds of categories, which makes it very gray for the customer. Does anyone really think that any retailer launches a competing product in a category without look…

This is totally false - the number of retailers who have testified before congress that they don't use seller data to compete against sellers - and then who go ahead and do just that is basically zero. Additionally, most other retailers actually BUY the third parties products and take the risk of promoting and selling it. On Amazon third parties take the inventory and many other risks and may have to pay amazon to pr…

How would Amazon not use sales data of comparable products to evaluate the launch of a new white label product?

Re: Amazon scooped up data from its own sellers to launch competing products

#162

Post by TheCoelacanth » Thu, Apr 23, 2020, 4:26 PM UTC

fastball wrote: post #136

thoraway1010 wrote: post #123

Earlier quoted context omitted.

This is totally false - the number of retailers who have testified before congress that they don't use seller data to compete against sellers - and then who go ahead and do just that is basically zero. Additionally, most other retailers actually BUY the third parties products and take the risk of promoting and selling it. On Amazon third parties take the inventory and many other risks and may have to pay amazon to pr…

Can you link to where AMZN has said this?

Paragraph two of the article

> The online retailing giant has long asserted, including to Congress, that when it makes and sells its own products, it doesn’t use information it collects from the site’s individual third-party sellers—data those sellers view as proprietary.

Re: Amazon scooped up data from its own sellers to launch competing products

#163

Post by freepor » Thu, Apr 23, 2020, 4:26 PM UTC

stcredzero wrote: post #128

whoisjuan wrote: post #17

Stating the obvious I guess. All retailers do this and create their own white-label brands to squeeze profit from well-performing categories. Target, for instance, is very upfront about it and they have like a gazillion white-label brands that compete in hundreds of categories, which makes it very gray for the customer. Does anyone really think that any retailer launches a competing product in a category without look…

Does anyone really think that any retailer launches a competing product in a category without looking at all their supplier data? So, if cars are inevitably becoming computers with wheels, what's going to happen to insurance companies? The major weapon of underwriting is data, and a company like Tesla is going to have a huge advantage in data over external insurance companies. Is it really a societal good for big com…

There are insurance companies who already sell trackers that plug into your car's OBD-2 port and have onboard hardware so that the insurance company sees your acceleration, handling, sudden braking, times you drive, miles you drive, etc.

Right now, very safe and low risk drivers can use these companies to get discounted insurance.

Eventually, every safe driver willing to install these trackers will do so for the lower insurance rates, leaving a much higher risk pool with the non-tracking insurance plans, and it will become very expensive to not be tracked by your car insurance company.

Re: Amazon scooped up data from its own sellers to launch competing products

#164

Post by coffeefirst » Thu, Apr 23, 2020, 4:26 PM UTC

allemagne wrote: post #78

MichaelApproved wrote: post #25

The solution isn't hoping the free market would solve this with a competing platform. The solution is to create regulations & laws that prevent this behavior. You're either a platform/retailer or you're a manufacturer. You don't get to be both because we see the perverse incentive that happens when it's allowed.

>You're either a platform/retailer or you're a manufacturer. You don't get to be both Ok, done. Now what are manufacturers supposed to do when Amazon and Walmart start bullying them some other way? You just made shipping their product directly to the customer against the law.

Well, the function of anti-trust law is specifically to target massive unchecked power.

If you're the supplier with a Shopify and Amazon Merchant account, or a local grocery store with white label products, none of this applies to you because you don't have the capability to effectively hold other businesses or markets hostage, no matter how aggressive you are.

Re: Amazon scooped up data from its own sellers to launch competing products

#165

Post by woodgrainz » Thu, Apr 23, 2020, 4:27 PM UTC

Operyl wrote: post #5

I thought this was common knowledge. Don’t the chains like Walmart do the exact same things?

Except Amazon testified that it didn't do that, to Congress.

https://www.cnbc.com/2019/07/16/amazon-tells-house-it-doesnt...

Re: Amazon scooped up data from its own sellers to launch competing products

#166

Post by [deleted] » Thu, Apr 23, 2020, 4:27 PM UTC

kharms wrote: post #98

chairmanwow1 wrote: post #76

Earlier quoted context omitted.

What really is the issue? That Amazon is leveraging its success to be successful? It's unfair that Amazon is able to see that a product category is doing well so it invests its own money into manufacturing a product to sell through its site? Do you really think that if Amazon couldn't use the data from its own site that it wouldn't procure it elsewhere? Before any product is developed there is extensive market resear…

>What really is the issue? That Amazon is leveraging its success to be successful? The issue is that over the long term, Amazon is lowering the ROI on innovating and taking risks in the consumer goods space. It's able to do this because of its dominance as a marketplace.

[deleted]

Re: Amazon scooped up data from its own sellers to launch competing products

#167

Post by archgoon » Thu, Apr 23, 2020, 4:28 PM UTC

So this seems to be getting drowned out a bit; but the core issue here is not that Amazon is creating their own labels to compete with seller's products. It's that they've publicly stated, including to congress, that they don't use non-public, seller specific data to compete with them; and now former employees are claiming that's a lie.

Amazon agrees that, as claimed, this is a problem.

'Amazon said employees using such data to inform private-label decisions in the way the Journal described would violate its policies, and that the company has launched an internal investigation.'

Re: Amazon scooped up data from its own sellers to launch competing products

#168

Post by toasterlovin » Thu, Apr 23, 2020, 4:28 PM UTC

luckylion wrote: post #95

dubcanada wrote: post #74

Earlier quoted context omitted.

You're focused to much on Amazon. Every company does this just go to your local Walmart, everything is white-label. A law like this would have to be applied to them as well.

> A law like this would have to be applied to them as well. You say it as if that was a bad thing. More competition is good for the consumer, bad for the oligopolists.

On the contrary, house brand products are great for consumers. Rather than having to figure out if they can trust a brand for a product category that they really don't care about, they can just buy the house brand knowing that a certain minimum level of quality exists. This is why Amazon Basics products are so popular on Amazon: consumers know that, at the very least, Amazon can be sued, a form of recourse that is not available with most of the smaller brands and sellers on their platform.

Re: Amazon scooped up data from its own sellers to launch competing products

#169

Post by vntok » Thu, Apr 23, 2020, 4:28 PM UTC

rsanek wrote: post #91

allemagne wrote: post #78

Earlier quoted context omitted.

>You're either a platform/retailer or you're a manufacturer. You don't get to be both Ok, done. Now what are manufacturers supposed to do when Amazon and Walmart start bullying them some other way? You just made shipping their product directly to the customer against the law.

No, that's not what a platform is. You can always sell your product direct to consumer. You just can't be the intermediary for both your own and other companies' products on the same site.

OK, done. Now you have Amazon Basics' products competing with Amazon Fulfillment's products on Amazon Dotcom's website. Different entities, not even under the same corporate governance.

Re: Amazon scooped up data from its own sellers to launch competing products

#170

Post by stcredzero » Thu, Apr 23, 2020, 4:29 PM UTC

balls187 wrote: post #146

stcredzero wrote: post #128

Earlier quoted context omitted.

Does anyone really think that any retailer launches a competing product in a category without looking at all their supplier data? So, if cars are inevitably becoming computers with wheels, what's going to happen to insurance companies? The major weapon of underwriting is data, and a company like Tesla is going to have a huge advantage in data over external insurance companies. Is it really a societal good for big com…

Insurance companies are already offering discounts for using their apps while in car.

Insurance companies are already offering discounts for using their apps while in car.

I was debating on whether I should include mention of these apps. Here's the thing about that: The data available to these apps is nothing compared to the data available to Tesla. Tesla can figure out how often you get close to bumping into something, exactly how far, how fast you were going, and what the lighting/weather conditions were like at the time. That data is orders of magnitude better than the stuff coming out of the app.

It's very analogous to iOS app makers competing with in-house Apple iOS apps. It's hard to compete, when your competitor controls the APIs.