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

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

#201

Post by JumpCrisscross »

User23 wrote: post #176
shubb wrote: post #68

Earlier quoted context omitted.

They have a data advantage- Amazon basics are just white labeled goods from some Chinese factory, warehoused and dispatched from an Amazon warehouse just like everything else on Amazon Market. The only difference is Amazon but the stock (and bet on it selling). Amazon has much better visibility on sales, margins, user behaviour than their market sellers. Where risk is high they allow sellers to take the risk, where i…

> It's a great business model, like a hedge fund running an exchange with no separation of information. It would be illegal the financial sector. Maybe I'm misunderstanding, but wasn't Glass–Steagall repealed? A lot of people don't realize, but hedge funds are the small fry. I mean sure a few hundred million or even a billion or two dollars sounds like a lot of money, but once you realize how much the Fed is pumping…

> wasn't Glass–Steagall repealed?

Glass-Steagall banned federally-insured banks from competing with investment banks. Information walls, which have to do with insider trading, are a separate beast.

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

#202

Post by massysett »

TeMPOraL wrote: post #140
modeless wrote: post #74

Earlier quoted context omitted.

> Amazon's brand (as a store / marketplace) is that it helps you sort through many options to select the product they believe you will like the best This is an extremely important part of the service that every store provides. The only difference with Amazon is that they offer a wider selection of everything. In brick and mortar stores, only one or a few products of each type are stocked and the rest are simply not o…

Now that we have ubiquitous Internet access, I think it's important to reinforce the point that you shouldn't use a store - whether a brick&mortar or on-line - as a product discovery and recommendation engine. You won't find the best value for money this way.

Then what do you recommend?

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

#203

Post by shostack »

jimnotgym wrote: post #118
txcwpalpha wrote: post #66

Earlier quoted context omitted.

>This is different from the service offered by traditional grocery stores which offer many different products, but are not arranging those products in relation to a particular request. Grocery stores (and all other brick-and-mortars) spend tons and tons of money and effort specifically arranging their stores to influence which products you will buy. It's done on the scale of which aisle certain products are on, all t…

>Grocery stores (and all other brick-and-mortars) spend tons and tons of money and effort specifically arranging their stores And if I don't like Tesco I can go to Asda. If Tesco won't sell my product I can try and sell it to Sainsbury's or Waitrose. The equivalent with Amazon is "If I don't like Walmart, there is some guy with a market stall selling fish, another with apples, a store 5 miles away that has carrots...…

Not sure if you realized how ironic your NYSE comment was given semi recent news...

https://www.cbsnews.com/news/nyse-jeffrey-c-sprecher-kelly-l...

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

#204

Post by pwdisswordfish2 »

aeturnum wrote: post #52
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…

I think it's easy to describe why it's problematic without even referring to antitrust. Amazon's brand (as a store / marketplace) is that it helps you sort through many options to select the product they believe you will like the best. This is different from the service offered by traditional grocery stores which offer many different products, but are not arranging those products in relation to a particular request.…

"The same is true of any other algorithmic sorting."

This is the same problem that Google creates.

Imagine if the Yellow Pages advertisements, listed categorically and alphabetically, were re-sorted according to an algorithm according to whomever was accessing them.

To use a popular term, sorting has been "weaponised".

It is a form of filtering, curation, gatekeeping. Businesses compete to pass through the filters, past the gate.

For example, when a user selects an app for her phone, she selects from a "top 10" or some such. As with being on "page one" of Google search results, manipulating the algorithm becomes a goal. Another popular term online, "winner take all" or "network effect", is in part enabled through sorting. All those hundreds of thousands of other apps are sorted out to create a "top 10" for which all must compete.

Instead of letting users sort results on their own initiative, e.g., according to popularity or rating, listings are sorted by default.

Alphabetical listings do not create the competition that drives up the value of the "top 10" or "page one". Alphabeticisation is a transparent algorithm everyone can understand, not a trade secret.

Even on HN, we see comments re-arranged in their order in a thread, in order to manipulate reader response.

There is certainly an element of utility and convenience but, in effect and perhaps by intent, there is more to the sorting than simply what may benefit the user.

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

#205

Post by akiselev »

txcwpalpha wrote: post #66
aeturnum wrote: post #52

Earlier quoted context omitted.

I think it's easy to describe why it's problematic without even referring to antitrust. Amazon's brand (as a store / marketplace) is that it helps you sort through many options to select the product they believe you will like the best. This is different from the service offered by traditional grocery stores which offer many different products, but are not arranging those products in relation to a particular request.…

>This is different from the service offered by traditional grocery stores which offer many different products, but are not arranging those products in relation to a particular request. Grocery stores (and all other brick-and-mortars) spend tons and tons of money and effort specifically arranging their stores to influence which products you will buy. It's done on the scale of which aisle certain products are on, all t…

Manufacturers pay chain supermarkets "slotting fees" for prime shelf space so while isle layout may be meticulously planned, the actual product placement per category is often up to how much suppliers are willing to pay. That's one of the reasons why branded products continue to do well against their generic equivalents.

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

#206

Post by uoaei »

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.

No, this is like if the name brand is on every shelf but the store brand is in the front of every shelf so that the name brand can't be seen until you move past the store brand.

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

#207

Post by uoaei »

robertlagrant wrote: post #108
ponker wrote: post #22

Earlier quoted context omitted.

Lots of things that are "normal" become highly anti-human when done with Amazon's scale and lack of human review/input.

> Lots of things that are "normal" become highly anti-human when done with Amazon's scale and lack of human review/input. This would make more sense if the consumers benefiting were not human.

It matters how many humans are benefiting, versus how many humans exist.

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

#208

Post by raz32dust »

malandrew wrote: post #192
raz32dust wrote: post #160

Earlier quoted context omitted.

This has been discussed in threads below, but the jist of the issue is that Amazon is pretty much a monopoly as an online product discovery service. If they put their own products at the top, people will end up with no way of discovering other companies. It would be using its monopoly position as a product discovery service to profit its own manufacturing subsidy. > Every retailer can compete with Amazon on any axis…

It's absolutely laughable when people say that Amazon operates as "a monopoly as an online product discovery service". There are so so so many options out there. I use plenty of online retailers all the time. Complaining about them being a monopoly in this way is like going to the same brick and mortar retailer and complaining they are a monopoly because you're too lazy to see what other retailers are available. If a…

I suspect you are an outlier. Amazon takes ~50% of online shopping market share [1]. Admittedly it is lower than I thought. I expected it to be closer to 70%. Google for search is actually at 71% [2]. Either way, I think 50% is enough market power to be treated as a monopoly, not sure about the legal definition.

That said, I am not particularly worried about Amazon basics as these are commodity products, as long as they are being transparent about it. Monopoly is a problem only if they use tactics that prevent competitors from emerging - example could be incentivizing vendors to sell only on Amazon.

[1] https://www.statista.com/statistics/788109/amazon-retail-mar... [2] https://www.netmarketshare.com/search-engine-market-share.as...

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

#209

Post by deelowe »

ghostpepper wrote: post #97
throwaway_USD wrote: post #31

Earlier quoted context omitted.

Under Anti-trust law Company A and Company B can do the same exact thing, but 1 Company may violate Anti-trust laws while the other doesn't. >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. It is not about a "monopoly", under Anti-trust you can't unfairly leverage your market position to f…

Why don't grocery stores get in trouble then? Do you need to be effective at forcing competitors out of the market or does simply the attempt make one guilty? Don't all businesses want to force their competitors out of the market? As an aside it does not surprise me at all when I learn that a law is not worded in a way that's congruent with the popular conception of the law.

> As an aside it does not surprise me at all when I learn that a law is not worded in a way that's congruent with the popular conception of the law.

Anti-trust law only applies to businesses which have market dominance. Grocery stores generally aren't in this position except for Wal-Mart which has similar concerns.

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

#210

Post by malandrew »

raz32dust wrote: post #208
malandrew wrote: post #192

Earlier quoted context omitted.

It's absolutely laughable when people say that Amazon operates as "a monopoly as an online product discovery service". There are so so so many options out there. I use plenty of online retailers all the time. Complaining about them being a monopoly in this way is like going to the same brick and mortar retailer and complaining they are a monopoly because you're too lazy to see what other retailers are available. If a…

I suspect you are an outlier. Amazon takes ~50% of online shopping market share [1]. Admittedly it is lower than I thought. I expected it to be closer to 70%. Google for search is actually at 71% [2]. Either way, I think 50% is enough market power to be treated as a monopoly, not sure about the legal definition. That said, I am not particularly worried about Amazon basics as these are commodity products, as long as t…

Taking 50% of online shopping share because your product is that much better than the competition is totally different than there are no other options.

Imagine you have 1000 stores all on the same street and one is so much better than the other stores that 50% of sales happen in that one store and there are no shenanigans where that one store is disadvantaging the other 999 stores. How can you argue that that is a monopoly?

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