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New unsealed records reveal Amazon's price-fixing tactics, California AG claims

theguardian.com

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Re: New unsealed records reveal Amazon's price-fixing tactics, California AG claims

#41

Post by 14 »

fg137 wrote: post #14
lelandfe wrote: post #7

If you've ever seen those "Click To Reveal Price" or "Price Only Revealed At Checkout" products online, this here is one reason why. They help businesses keep discounted prices hidden from Amazon's crawlers.

Is it effective, like, at all?

I know myself as well as others in my family have talked about this many times and have a hard rule that if someone has to hide the price they are ashamed of it and we refuse to support them. I literally experienced this tonight. I've been wanting to try some SnackCrates the service where you get snacks from around the world delivered monthly or just a single box if you want. Well the Company SnackCrate stopped shipping to Canada so been looking for another company that does. I see an ad on Facebook and check it out. First looked if they deliver to Canada before anything else. Then try find a price and you can't. Looked all over their site with nothing that even hints at the cost. They want you to first do a snack test to determine good snacks you may like then provide information and so on. Then you can see pricing options. I refuse to do that. Instantly left the site and read the comments on Facebook where I then saw several comments state how expensive they were for such little abouts of snack which made me say yep they are ashamed of the price and that's why they hide it.

Re: New unsealed records reveal Amazon's price-fixing tactics, California AG claims

#42

Post by yabutlivnWoods »

fmajid wrote: post #4

[flagged]

Shouldn't be hard with the obvious circular investing and... oh yeah... the poaching emails between Steve Jobs and Eric at Google back in the day, along with emails revealed during a discovery phase where big tech CEOs were agreeing to act in each other's interests as if they were one big family of companies; it's just physics, afterall

But everyone was making tons of money due to ZIRP trickle down no one cared then

Re: New unsealed records reveal Amazon's price-fixing tactics, California AG claims

#43

Post by tomhow »

fmajid wrote: post #4

[flagged]

This seems like a grand proclamation rather than a curious conversation-starter about the specific case the article is about. The guidelines have different ways of asking us to avoid this kind of comment.

Please don't fulminate...

Eschew flamebait. Avoid generic tangents. Omit internet tropes.

Please don't use Hacker News for political or ideological battle. It tramples curiosity.

https://news.ycombinator.com/newsguidelines.html

It would make all the difference if the comment included some commentary on why Antitrust law is inadequate in this case and how RICO would be likely to enable a better outcome.

Re: New unsealed records reveal Amazon's price-fixing tactics, California AG claims

#44

Post by snovv_crash »

LorenPechtel wrote: post #26

And what's really stupid about this is that done openly there probably wouldn't be an issue. Insurance companies can demand providers charge them the lowest rate they charge anyone. Would there have been any issue if Amazon had simply said that to get those features you must match any deals you give anyone else?

Selling to a reseller at the same price isn't an issue. The problem is disallowing selling direct to customer at a lower price. It means if someone makes another online marketplace, let's call it Ganjes, then if they have lower overheads they can't sell for less than Amazon does. Similar for DTC from the manufacturer.

Re: New unsealed records reveal Amazon's price-fixing tactics, California AG claims

#45

Post by avidiax »

refurb wrote: post #28

If Amazon punishes sellers for having lower prices elsewhere, isn’t it the sellers choice whether to lower their price on Amazon OR raise their price for other sellers? I didn’t see anything in the article suggesting Amazon ask for the 2nd option, just examples of sellers who did the 2nd one.

You are correct that the merchants have that choice.

Amazon's behavior is still anti-competitive. They are the big boys. The drive lots of volume, and have high fees. This policy makes it impractical for most vendors to support Amazon's competitors or compete with Amazon themselves. And it robs customers of a meaningful choice that would cut out an expensive middleman.

Without this policy, you might see lots of products on Amazon that are $19.99 with Amazon's 30% cut, and maybe $13.99 (30% less) on the vendor's own website. The consumer loses twice with Amazon's policy: once because they couldn't get the item at a cheaper price, and again because they didn't support any innovation or competition in the market, which would also lower prices.

Re: New unsealed records reveal Amazon's price-fixing tactics, California AG claims

#46

Post by binarysolo »

lelandfe wrote: post #7

If you've ever seen those "Click To Reveal Price" or "Price Only Revealed At Checkout" products online, this here is one reason why. They help businesses keep discounted prices hidden from Amazon's crawlers.

Long-time seller/distributor here -- the main reason for this is mandated by brands, who want to make sure their MAP (minimum advertised price) is respected across all channels.

Basically different distribution channels (speciality shops, big box marketplaces, and ecom stores) have very different levels of overhead, so if each channel was allowed to set their own price, you'd end up with brick and mortar stores doing a lot of showrooming and then online stores gaining the bulk of sales because they're cheaper (because their overhead is low).

This pretty much happened in the early 2000s-2010s so over time brands became VERY particular about enforcing MAP.

Re: New unsealed records reveal Amazon's price-fixing tactics, California AG claims

#47

Post by TeMPOraL »

binarysolo wrote: post #46
lelandfe wrote: post #7

If you've ever seen those "Click To Reveal Price" or "Price Only Revealed At Checkout" products online, this here is one reason why. They help businesses keep discounted prices hidden from Amazon's crawlers.

Long-time seller/distributor here -- the main reason for this is mandated by brands, who want to make sure their MAP (minimum advertised price) is respected across all channels. Basically different distribution channels (speciality shops, big box marketplaces, and ecom stores) have very different levels of overhead, so if each channel was allowed to set their own price, you'd end up with brick and mortar stores doing…

> you'd end up with brick and mortar stores doing a lot of showrooming and then online stores gaining the bulk of sales because they're cheaper (because their overhead is low)

This is what I see happen in Poland with clothes and electronics stores, but I don't exactly understand what MAP is supposed to be solving here, given that the brick&mortar and on-line stores are literally the same entity/brand, and in case of clothing, they're also the manufacturer brand?

Re: New unsealed records reveal Amazon's price-fixing tactics, California AG claims

#48

Post by binarysolo »

Long-time Amazon seller/brand here, so here's the crux of the case:

1. Amazon is a search engine for product

2. It values being the cheapest destination for products (MFN most favored nation clause to sell on their website), and basically will suppress your listings from search if they can find you selling it cheaper elsewhere.

3. Amazon is def one of the more expensive ecom channels to sell, BUT they've got a huge audience as well due to decades of consumer-first policies, so sellers still go there because even if they have loyal customers with strong brand loyalty, you still end up with at least 30% of customers going to Amazon first after seeing your ads elsewhere + the lure of NTB new-to-brand customers you can acquire there.

So the crux of the case is dependent on whether they can do #2 with impunity -- which Amazon considers "consumer friendly" (but obviously it's win-win for them too).

Re: New unsealed records reveal Amazon's price-fixing tactics, California AG claims

#49

Post by mgiampapa »

binarysolo wrote: post #48

Long-time Amazon seller/brand here, so here's the crux of the case: 1. Amazon is a search engine for product 2. It values being the cheapest destination for products (MFN most favored nation clause to sell on their website), and basically will suppress your listings from search if they can find you selling it cheaper elsewhere. 3. Amazon is def one of the more expensive ecom channels to sell, BUT they've got a huge a…

I order from Amazon because of their logistics. For some reason Amazon can ship for free at the same price as the producer's Shopify page that wants to charge me insane shipping because I live in a remote location.

Yes, I understand the price fixing is why they aren't selling for less on their own site, but Amazon's superpower is logistics, not years of goodwill and brand loyalty.

Re: New unsealed records reveal Amazon's price-fixing tactics, California AG claims

#50

Post by binarysolo »

TeMPOraL wrote: post #47
binarysolo wrote: post #46

Earlier quoted context omitted.

Long-time seller/distributor here -- the main reason for this is mandated by brands, who want to make sure their MAP (minimum advertised price) is respected across all channels. Basically different distribution channels (speciality shops, big box marketplaces, and ecom stores) have very different levels of overhead, so if each channel was allowed to set their own price, you'd end up with brick and mortar stores doing…

> you'd end up with brick and mortar stores doing a lot of showrooming and then online stores gaining the bulk of sales because they're cheaper (because their overhead is low) This is what I see happen in Poland with clothes and electronics stores, but I don't exactly understand what MAP is supposed to be solving here, given that the brick&mortar and on-line stores are literally the same entity/brand, and in case of…

So game-theoretically: if I know the price for an item is the same everywhere, I'll buy it at the place where I see it first (one of the big values of brick and mortar stores).

If I know I can go online and it'll be some % cheaper, I'll wait and order it online, defer my gratification for a few days, and end up with a cheaper product.

Not sure about Poland, but most B&M brick and mortar stores in the US are distributors/resellers of the brand, they buy for $4 and sell for $10, and their rent/labor/etc costs $3 and they profit $3. Another distributor let's say is an e-commerce website, they can setup a warehouse in a rural area with cheap labor so it costs them $1 and they profit $5... so they can afford to discount it to $7 and make $2... which the B&M store can't do because they won't profit at all.

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