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Amazon’s New Competitive Advantage: Putting Its Own Products First

propublica.org

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Re: Amazon’s New Competitive Advantage: Putting Its Own Products First

#11

Post by benologist »

radiator wrote: post #4

Reading this, one gets the feeling that Amazon advertise their products on some sort of public place, and that this is perhaps not right. But in reality they simply own the whole thing and it is perfectly reasonable to do however they want.

Their predatory conduct is being investigated in the EU [1] and US [2] which suggests it is far from "perfectly reasonable" and may not even be legal.

[1] https://www.cnbc.com/2019/07/17/eu-to-investigate-amazon-ove...

[2] https://www.theguardian.com/technology/2020/may/01/amazon-je...

Re: Amazon’s New Competitive Advantage: Putting Its Own Products First

#13

Post by saltedonion »

I don’t see what’s wrong with this.

Many retailers reserve some of their best shelves paces for their private label products, both as a form of differentiation and to extract higher margins.

You could argue that Amazon is unique in that it is large and potentially has a monopoly over eCommerce, but it is hard to say that in the end, consumers are on the loosing end.

Most amazon basic products are commodities, and prices gets lower because of economies of scale. Should amazon jack up the price, consumers will just switch to another whitelabel/run of the mill variant from another seller.

It will be problematic if amazon dumps on the market and drives theirs party sellers out of existence, but I don’t think that is the case here.

Re: Amazon’s New Competitive Advantage: Putting Its Own Products First

#14

Post by dmoy »

Fauntleroy wrote: post #9
radiator wrote: post #4

Reading this, one gets the feeling that Amazon advertise their products on some sort of public place, and that this is perhaps not right. But in reality they simply own the whole thing and it is perfectly reasonable to do however they want.

Oh definitely, if you ignore the whole monopoly aspect.

Doesn't Amazon have like less than 40% of US online retail, and less than 10% of US retail total?

I guess rephrasing, what's the definition of monopoly here?

Re: Amazon’s New Competitive Advantage: Putting Its Own Products First

#15

Post by Spivak »

doener wrote: post #6
nojito wrote: post #5

No different than when you go to the store and the store's brand products are at eye level and the name brands are lower on the shelf.

Very different, because Amazon is mot one market, but THE market online in the Western World.

And Walmart is the grocery store in a lot of small towns. Amazon doesn't have that much lock-in outside of customer's preference to shop there. Their power is in that customers go there to discover products, but that's Target's advantage too and it would be weird to try and tell them how they're allowed to stock their shelves.

Re: Amazon’s New Competitive Advantage: Putting Its Own Products First

#16

Post by srhngpr »

doener wrote: post #6
nojito wrote: post #5

No different than when you go to the store and the store's brand products are at eye level and the name brands are lower on the shelf.

Very different, because Amazon is mot one market, but THE market online in the Western World.

I think OP's point is still valid; doesn't matter if you go to one store or another (e.g., Walmart or Safeway), if that store has a house brand, chances are their equivalent house brand is at the same level or higher than the name brand.

Re: Amazon’s New Competitive Advantage: Putting Its Own Products First

#18

Post by dhruvkar »

Fauntleroy wrote: post #9
radiator wrote: post #4

Reading this, one gets the feeling that Amazon advertise their products on some sort of public place, and that this is perhaps not right. But in reality they simply own the whole thing and it is perfectly reasonable to do however they want.

Oh definitely, if you ignore the whole monopoly aspect.

I see this argument a lot for Amazon.

monopoly: the exclusive possession or control of the supply of or trade in a commodity or service.

Aren't suppliers free to start their own store, drive traffic to it and make money? Aren't suppliers free to list their products on Amazon, Ebay, Craigslist, Etsy, Shopify etc.?

How is this considered a monopoly? I'm actually interested in an answer. I might be missing something.

Re: Amazon’s New Competitive Advantage: Putting Its Own Products First

#20

Post by chillacy »

saltedonion wrote: post #13

I don’t see what’s wrong with this. Many retailers reserve some of their best shelves paces for their private label products, both as a form of differentiation and to extract higher margins. You could argue that Amazon is unique in that it is large and potentially has a monopoly over eCommerce, but it is hard to say that in the end, consumers are on the loosing end. Most amazon basic products are commodities, and pri…

Add to this the fact that a lot of these brands don’t even manufacture their items in the first place: they source manufacturers and slap their logo and marketing on, then markup the item price. Does that really add value?

In some cases the private label even uses the same manufacturers, the people producing the product still get paid in the end.

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