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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

#81

Post by aeturnum »

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…

Yes, they do. That's why I said they "are not arranging those products in relation to a particular request." We are all in the same store, and that store must arrange itself in a way that will serve all customers. Amazon's business model is premised on the idea that they provide a better service than that.

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

#82

Post by luckylion »

telchar wrote: post #24
masona wrote: post #7

Working at an agency that mostly did CPG work for P+G, I remember how so much of the design work was about catching someone's eye on shelf: how to stand out in a sea of packaging. Millions (and millions) of dollars were spent trying to crack the code. But it's no longer a flat canvas where you can see everything all at once. The shelf is not flat, it's deep. You have to move through products one by one. In the articl…

I think the depth is inversely proportional to the utility of search - the better I can search for the combination of features, price, etc that I need the less deep the shelf gets. The endless generic white-labeled junk plus poor metadata really makes the problem bad though.

Okay, that sounds conspiratorial, but: is that why Amazon's search is atrociously terrible, so that they can sell the top spots for more? If you could search by attributes reliably, the top spots lose relative value.

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

#83

Post by saltking112 »

throwaway_USD wrote: post #79
saltking112 wrote: post #35

Earlier quoted context omitted.

but some industries clearly needs economies of scale in order to provide the consumer with cheaper and better products. Can you truly argue just because a firm is large they are no longer allowed to offer the same product for cheaper simply because they have a strong foothold in distribution?

>Can you truly argue just because a firm is large ... 1. I am not arguing anything, I did not develop Anti-trust law nor did I argue for or against it. 2. I never mentioned the the size of the Firm, because that isn't the legal standard. As I said what matters is unfairly forcing competition out of the market. What Amazon does is has other businesses develop products and markets for those products on the Amazon marke…

So suppose Amazon shared sales/behavior data with other sellers/companies, such that everyone is competing on a even footing with regards to product research. Do you still think what Amazon is doing is anti-competative?

In other words, if other well capitalized players had the same data, same ability to manufacture at the same scale, advertise etc... and Amazon's sole advantage is product placement, is it still problematic?

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

#84

Post by frenchyatwork »

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…

Sure, and it probably helps sell those things, but there are several differences between those to that makes them extremely different in practice.

1. There's limited space at the front of a brick and mortar store. It's not practical to put most of the items at the front, so anyone who's not just there for a bag of chips ends up looking through the aisles anyways.

2. Brick-and-mortar stores usually only sell a few forms of same product. If I want olive oil, there's some store brand, some italian-looking brand, and maybe a brand that advertises some sort of magical health benefits. There might be a few variations for the level of refinement/virginity. It's easy for me to look at all the options and compare them. When I look at a search page on Amazon, there's often 100's of hits, and it's often pretty unclear if there's any difference between them that I'd care about (see https://www.amazon.com/s?k=olive+oil).

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

#86

Post by simonkafan »

Large corporations use their market power to gain competitive advantages - fully understandable from Amazon's point of view. However, it is completely incomprehensible why the authorities do not intervene in the market in a regulating way in these cases more often.

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

#87

Post by WalterBright »

AnimalMuppet wrote: post #36
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.

I refer you to the Microsoft antitrust case. Microsoft owned the desktop OS, and was using that to give preference to IE. That... didn't fly. Using a monopoly in one area to gain market share in another area is in fact an antitrust violation.

The antitrust case was about Microsoft giving away a free browser. Every operating system comes with a free browser. My phone comes with a free browser. My kindle comes with a free browser.

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

#88

Post by txcwpalpha »

aeturnum wrote: post #81
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…

Yes, they do. That's why I said they "are not arranging those products in relation to a particular request." We are all in the same store, and that store must arrange itself in a way that will serve all customers. Amazon's business model is premised on the idea that they provide a better service than that.

> That's why I said they "are not arranging those products in relation to a particular request."

But they are, which is what you're missing. Again, these stores spend millions and millions of dollars collecting these requests and arranging their store in response. They collect feedback and rearrange the shelves nearly every day based on requests (which can be actual verbal/written requests on their website or to store workers, or derived from things like sales numbers).

You can think of it in this way: each time someone goes to the "Chips" aisle, that is a implicit "request" from the customer that they want to buy chips, and the store has arranged their aisle in such a way that influences which chips you buy, just as Amazon arranges their search results page.

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

#90

Post by saltking112 »

frenchyatwork wrote: post #84
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…

Sure, and it probably helps sell those things, but there are several differences between those to that makes them extremely different in practice. 1. There's limited space at the front of a brick and mortar store. It's not practical to put most of the items at the front, so anyone who's not just there for a bag of chips ends up looking through the aisles anyways. 2. Brick-and-mortar stores usually only sell a few for…

Theoretically Amazon has infinite shelf space, but in reality, no one really scrolls past the first few pages.

So in reality, if your product is on page 5, it is perhaps as good as not being on Amazon anyway for that particular query.

If you look at it this way, the space constraint isn't much different than brick and mortar.

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