Amazon’s New Competitive Advantage: Putting Its Own Products First • Hacker News Board

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

#211

Post by patd » Tue, Jun 09, 2020, 6:30 AM UTC

enos_feedler wrote: post #199

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.…

For me, Amazon helps me sort through many options to select the product that _I_ believe I will like best. I am not stupid. If I see an Amazon branded item I will obviously meet its placement with some kind of suspicion. In fact, I will dig a bit harder into the reviews. Do the batteries really last as long as some of the brand name ones? Let me see if it's worth the cheaper price. That sort of thing. Amazon can be t…

To your last point, to me, it feels that they try to hide their private labels. Some are named “Amazon XXX” but most are not: Solimo, Presto and countless clothing brands.

I mostly realise that they are Amazon brands when I notice they are strongly pushed by Amazon’s algorithm.

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

#212

Post by ashtonkem » Tue, Jun 09, 2020, 7:29 AM UTC

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…

It certainly feels intuitively wrong, especially when you find out that they use their own sales data and inventory to determine what white labeled products to release.

That’s not to say that it’s new or illegal, it just feels scummy.

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

#213

Post by PopeDotNinja » Tue, Jun 09, 2020, 8:12 AM UTC

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…

For physical retailers, I never needed to worry web scale, store brand Tasty-Os impacting the availability of my Cheerios.

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

#214

Post by BWGB » Tue, Jun 09, 2020, 8:25 AM UTC

Amazon are just using their competitive advantage. The world has changed, potentially through the introduction of Amazon, whereby consumers now want cheap products, now! Amazon can do that. People who are shopping for the first product they see don't have any brand affiliation and therefore it makes sense. If I loved a particular brand of coffee I would seek them out on Amazon.

Amazon are using their platform to cover off those customers who are neutral in their brand preference.

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

#215

Post by dsign » Tue, Jun 09, 2020, 8:32 AM UTC

Amazon has been criticized before for selling some third-party products of very low quality. Something they can solve by using the top-spot for their own brands, without completely marginalizing the third-party providers.

And it's not like you can't make your own online shop or at least a nice web page explaining your product better than at Amazon. I wish more sellers would go to the trouble of doing that.

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

#216

Post by renw0rp » Tue, Jun 09, 2020, 10:32 AM UTC

SkyMarshal wrote: post #200

Honestly, I’m so sick of all the fly-by-night ALLCAPS no-name brand names on Amazon setup by armies of passive income-seeking YouTube-advertising dropshippers. Amazons shopping experience these days is trash. If Amazon starts giving their own brand preferential treatment over this crap it will be an improvement to the service. The few Amazon brand products Ive purchased, like USB and Lightning cables, are among the b…

Couldn't agree more. There is so much crap advertised and sold there, with fake or paid for reviews that I buy only "sold by Amazon" 99% of the time I shop there. If only I could permanently enable such a filter site-wide...

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

#217

Post by paul_f » Tue, Jun 09, 2020, 11:27 AM UTC

txcwpalpha wrote: post #188

aeturnum wrote: post #174

Earlier quoted context omitted.

I'm with you as far as generic categories go. Going to the cheese and dairy section in a supermarket is very similar to going to the Amazon cheese and dairy (and eggs) section[1]. Stores maximizing the revenue they receive from their average customer, which they do quite aggressively as you note, feels very different from what Amazon is doing. >the store has arranged their aisle in such a way that influences which ch…

You're basically saying that because Amazon has better agility, and can effectively rearrange their "shelves" faster than Target can (Amazon can rearrange them between every customer, whereas Target can only do it maybe once a day), Amazon should be punished for that? I just don't really see why or how that makes a difference. To extend it again to the grocery store example, if I walk into a Target and ask the custom…

Brands pay for placement. Promoting a store brand over another brand that paid for placement, not one that is necessarily better, is not a problem IMO. It is good business. You're gonna lose advertising dollars, but that's a business decision. To survive, some brands will need to find a way to cut out the middleman - Amazon

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

#218

Post by Terretta » Tue, Jun 09, 2020, 12:00 PM UTC

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...…

> you can’t be the marketplace and sell through that marketplace

To be competitive, you can and you should.

Amazon is a platform company. Platforms commoditize the complements. They didn’t have toys, so partner Toys’R’Us, didn’t have shoes, so partner Zappos, etc.

As the platform, platforms observe transactions, such that through time, they can value complements and decide to co-exist, acquire, or compete.

This is by now a well-known strategy.

Rabbit hole: https://www.gwern.net/Complement

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

#219

Post by throwaway_USD » Tue, Jun 09, 2020, 12:14 PM UTC

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.

>Why don't grocery stores get in trouble then?

Because a grocery store selling white-label products isn't an unfair use of market position to force competitors out of the market.

How many times has a grocery white-label cereal bankrupted a Cherrios or forced them out of the market? Alternatively, how many stores do you hear about vendors that launched a successful product (even a #1 selling product) only to have to close after Amazon launched a copycat product.

>Don't all businesses want to force their competitors out of the market?

No, complimentary and substitute products are healthy for the market place. Again go back to the grocery store, they don't want General Mills/Post going out of business, they want to fill their shelves with those products.

>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.

This is true especially with 1st amendment and 2nd amendment law...I am not sure what the popular conception of Anti-trust law may be, but when it comes to Amazon I always see the white-label grocery store product analogy. What is great about the law is legal opinions often include factual analogies and distinctions like this, what would shock most people is how logically sound and exhaustive the courts are.

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

#220

Post by jdmichal » Tue, Jun 09, 2020, 1:21 PM UTC

Beached wrote: post #102

jdmichal wrote: post #40

Earlier quoted context omitted.

It's not about being scaled. It's about using your scale in one place to force scaling in another. If Amazon provides a marketplace, where people pay them to list and sell products, then using the strong position of that marketplace product to then leverage and scale up their own products is potentially troublesome.

I mean, Walmart is also mega huge, and also allows 3rd party sellers on their website. is it troublesome that Walmart also promotes their own items or the items where they make the most profit first?

I don't know if Walmart promotes their own brands over others on their website. If they do, then yes I would consider that under the same hazard.

Do note that this is all speculative anyway... There's been no ruling. Just some people pointing out problematic behaviour.