Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Amazon knew seller data was used to boost company sales

politico.eu

Post reply on HN
Print view View original

401–410 of 466 posts

Re: Amazon knew seller data was used to boost company sales

#401

Post by fredophile »

judge2020 wrote: post #387
Closi wrote: post #246

Earlier quoted context omitted.

> Costco and Amazon collect and analyze sales data from the sale of both company and non-company products. It's similar, although personally I think the relationship between the companies is meaningfully different: Costco purchases product from manufacturers, and may choose to source product from other manufacturers (including under its own brand name). It uses it's own sales data to make this decision. Amazon acts a…

Despite this I don't see how the case is that Amazon is being anti competitive while Costco isn't - just because they purchase and resell inventory doesn't mean Costco (or Walmart or Sams Club etc) doesn't hold the same power over their product suppliers that Amazon does to do data science on their sales to determine what new products to make in-house. Plus, walmart is now a marketplace as well. This overpriced GPU i…

Analyzing their own sales and analyzing other people's sales on their platform are two different things. Saying that Walmart may also try to do this in the future does not make it right or excusable.

Re: Amazon knew seller data was used to boost company sales

#402

Post by reaperducer »

jorblumesea wrote: post #329
nataz wrote: post #302

The most interesting part of the HN discussion is not about the definition of what Amazon is doing, but the occasional misunderstanding of how large brick and mortar retail businesses operate at scale (see: buying shelf space/payment dependant on sales/etc). There are lots of folks on here that understand what Amazon is doing, less who understand retail businesses mechanisms. I'm not sure what Amazon is doing is lega…

I don't think that's a fair comparison. It would be like if Amazon owned the entire mall, and would kick out competitors and establish their own stores once they become profitable. Amazon is both a retailer in the sense that they sell products, but also owns the entire marketplace as well.

It would be like if Amazon owned the entire mall, and would kick out competitors and establish their own stores once they become profitable.

Just wait. It may happen.

During the pandemic some of the big mall companies bought their tenants, either out of bankruptcy, or at crazy cheap prices.

At first it looked like the malls were just doing it to keep the lights on and the storefronts occupied. Now there's more and more people saying the mall companies may try to become "Amazon In Real Life."

To me, it sounds like Department Stores 2.0. But it'll be interesting to see if it actually happens.

Re: Amazon knew seller data was used to boost company sales

#403

Post by gamblor956 »

zachware wrote: post #220
Y-bar wrote: post #203

Earlier quoted context omitted.

I used to stuff shelves at a grocery chain ~20 years ago and one difference seldom mentioned is that grocery chains bought from the manufacturers. That meant that we as a grocery chain were responsible for the sale to consumer, we were not merely a marketplace for a bunch of different brands. So, even if we had our own competing labels for some products, the manufacturers would never be left in the cold with unsold s…

This is generally not how grocery operates today. Most large grocers: - Sell shelf location slots to the highest bidder. - Include a consignment clause in their vendor agreements requiring vendors to take back spoiled, customer-damaged, and unsold inventory at X point or on-demand. - Require merchandisers to keep inventory in-stock for as many products as they can get vendors to manage (e.g. the coke delivery person…

What you have described is false. The major brands do not "sell shelf location slots" to the highest bidder (aka slotting fees), or require consigment clauses, or require merchandisers to keep inventory in-stock, as a general practice.

Slotting fees and consignment clauses only apply to new products. Slotting fees are used as an alternative to consignment; they are basically a discount on the wholesale price paid by the store for new products that may not sell through. Alternatively, the store may sell the items on consignment, in which case it only pays the distributor for products actually sold through.

Merchandisers...are employees of the stores (they're responsible for internal marketing efforts)...Perhaps you meant distributor? Only a few store chains have an in-stock requirement (Walmart and Costco), and that is due solely to the volume at which they sell-through.

More importantly, and the crucial legal distinction: retail stores pay the distributors for the inventory on their shelves, except for the 1% offered on consignment (i.e., new products sold on a trial basis), while Amazon gets paid by the distributors. That legal distinction is at the heart of why what Amazon does is problematic.

(Source: Kroger was a former client.)

Re: Amazon knew seller data was used to boost company sales

#404

Post by sokoloff »

TameAntelope wrote: post #392
sokoloff wrote: post #349

Earlier quoted context omitted.

> as much of a monopoly/monopsony as Walmart is, it's far less than what Amazon is. Walmart retail sales are significantly larger than Amazon's retail sales. For 2019 (chosen to avoid the disparate impact of pandemic), Walmart sold $514B while Amazon retail sold only $135B first-party and $200B third-party. Given the growth rates, Amazon will pass Walmart, but I don't think Walmart has "far less" power in retail than…

This, and Walmart isn't just going to sit by and let Amazon win, why would they? I think folks on the Internet generally tend to assume Amazon is inevitable, but I doubt that's how Walmart thinks of it. Walmart and Amazon are both good for one another, and their competition helps us, except for when they basically non-compete over things like wages.

I agree about the internet/tech user part of that. If you asked me to give estimates of their relative size 5 years ago, I'd have probably said that Amazon was much bigger than Walmart, which would have been entirely wrong, of course.

The pandemic was a huge boon for Amazon, but I don't think the battle for retail will have a clean, singular winner and consumers are endlessly demanding in terms of what it will take to remain the winner. Toys-R-Us and Sears learned that painful lesson within our adult lifetime. They won't be the last.

Re: Amazon knew seller data was used to boost company sales

#405

Post by arrozconcosas »

cmeacham98 wrote: post #391
nataz wrote: post #302

The most interesting part of the HN discussion is not about the definition of what Amazon is doing, but the occasional misunderstanding of how large brick and mortar retail businesses operate at scale (see: buying shelf space/payment dependant on sales/etc). There are lots of folks on here that understand what Amazon is doing, less who understand retail businesses mechanisms. I'm not sure what Amazon is doing is lega…

These comparisons to brick&mortar stores are mostly irrelevant. Amazon told 3rd party sellers it wouldn't use their sales data for its own sales (and possibly contractually agreed not to? - unsure here), and it now seems that they broke this promise. How other stores operate doesn't matter. Amazon said it wouldn't do this and used that trust to attract sellers and grow their platform.

Companies break contracts all the time. The consequences range and can include legal action, hurt relationships, lost business ... but also could be minor ('business is business').

Re: Amazon knew seller data was used to boost company sales

#406

Post by ethbr0 »

lupire wrote: post #367
sokoloff wrote: post #349

Earlier quoted context omitted.

> as much of a monopoly/monopsony as Walmart is, it's far less than what Amazon is. Walmart retail sales are significantly larger than Amazon's retail sales. For 2019 (chosen to avoid the disparate impact of pandemic), Walmart sold $514B while Amazon retail sold only $135B first-party and $200B third-party. Given the growth rates, Amazon will pass Walmart, but I don't think Walmart has "far less" power in retail than…

I think mail order and brick&mortar compete in some product segments, but are separate in others. For example, perhaps split off much of grocery and bulky cheap items as well as legally constrained products from WalMart's total (although Amazon is making inroads there).

Walmart has a huge online/mail component too. They basically bought and (unlike so many) successfully integrated and digested Jet (and now Bonobos) explicitly for that.

Re: Amazon knew seller data was used to boost company sales

#407

Post by ethbr0 »

sokoloff wrote: post #404
TameAntelope wrote: post #392

Earlier quoted context omitted.

This, and Walmart isn't just going to sit by and let Amazon win, why would they? I think folks on the Internet generally tend to assume Amazon is inevitable, but I doubt that's how Walmart thinks of it. Walmart and Amazon are both good for one another, and their competition helps us, except for when they basically non-compete over things like wages.

I agree about the internet/tech user part of that. If you asked me to give estimates of their relative size 5 years ago, I'd have probably said that Amazon was much bigger than Walmart, which would have been entirely wrong, of course. The pandemic was a huge boon for Amazon, but I don't think the battle for retail will have a clean, singular winner and consumers are endlessly demanding in terms of what it will take t…

From a little bit of retail corporate experience: people are used to seeing Amazon roll over competitors with under-invested supply chains.

There aren't really any of those left.

Amazon taking on Walmart, Home Depot, or (I assume) Target is going to look very different. Because all have been shoveling money into their supply chain efficiencies for the last 10 years.

Re: Amazon knew seller data was used to boost company sales

#408

Post by theturtletalks »

lupire wrote: post #380
judge2020 wrote: post #346

Earlier quoted context omitted.

> Moreso in non US advanced countries that actually enforce the anti trust regulations in their laws. I think it's pretty disingenuous to say that the U.S. isn't enforcing its antitrust laws, the DOJ certainly opens investigations against these conglomerates, they just don't take them to court, so there might not be enough info for the DOJ to think there's a case. We don't know the full story for any of these cases a…

Potayto, potahtoh. Failed enforcement attempts are as ineffective as non-attempted enforcement.

What's a law with no teeth?

Re: Amazon knew seller data was used to boost company sales

#409

Post by theturtletalks »

savanaly wrote: post #379
ska wrote: post #371

Earlier quoted context omitted.

To abuse this analogy further - if they also put signs for their owns stores in front of the other stores signage, or redesign the mall to direct people away from the competitors - that seems less fine.

What if there's multiple other malls just across the street? As is the case in online retail. Even easier than crossing the street, to be honest, just click that second result in Google instead of the first. Is it so hard to admit that Amazon's customers are using them because their offering is great and not because of lack of alternatives?

Amazon has always used dark patterns with their 3rd party sellers. They even restrict the price sellers can charge on products they sell on Amazon and their own website. This ensures Amazon will be the lowest price.

In this analogy, that would mean you have a store inside the mall and right across the street. Amazon sees you are selling products cheaper across the street since rent across the street is way cheaper than inside the mall. Amazon then says either you charge the same price in the mall or you get kicked out. You could call Amazon's bluff but most sellers are not risking their seller accounts.

Re: Amazon knew seller data was used to boost company sales

#410

Post by judge2020 »

fredophile wrote: post #401
judge2020 wrote: post #387

Earlier quoted context omitted.

Despite this I don't see how the case is that Amazon is being anti competitive while Costco isn't - just because they purchase and resell inventory doesn't mean Costco (or Walmart or Sams Club etc) doesn't hold the same power over their product suppliers that Amazon does to do data science on their sales to determine what new products to make in-house. Plus, walmart is now a marketplace as well. This overpriced GPU i…

Analyzing their own sales and analyzing other people's sales on their platform are two different things. Saying that Walmart may also try to do this in the future does not make it right or excusable.

How is it different? The same outcomes and potential power abuse happens in both situations.
Post reply on HN