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Amazon Changed Search Algorithm in Ways That Boost Its Own Products (wsj.com)
642 points by juokaz on Sept 16, 2019 | hide | past | favorite | 413 comments

Considering how shopping at Amazon now feels like shopping at an electronics bazaar in Singapore with giant bins of random knock-off products of suspicious quality, tweaking the algo to push name-brand options (even if it's their own name-brand) would be a welcome move to me as a buyer.

Obviously it's grossly unfair to their vendors, but from a strictly user-centric view it's an improvement.

Otherwise, Amazon feels like AliExpress with faster shipping and better English.

> Otherwise, Amazon feels like AliExpress with faster shipping and better English.

It literally is. All these products are cheap stuff that marketers find on aliexpress. They buy them in bulk, stamp a logo on it, import in the US/EU, stock in logistic centers and then sell on Amazon. It's the same stuff, but it comes from an English seller and a warehouse in US/EU.

It's exactly the same thing that Amazon does with its product lines though (like Amazon Basics), so not really rooting for their own name-brands either.

The one difference is that the Amazon Basics products seem to have a quality bar higher than the other random re-labeled products.

I'm not sure about Amazon Basics, but with Amazon's Choice products they're plainly not evaluating products before selecting them. LockpickingLawyer on youtube has done reviews on several Amazon's Choice locks and safes and they've all been abysmal borderline fraudulent products.

Amazon's Choice is a purely algorithmic tag decided by the computer. It's utterly meaningless. I guess they change periodically on some reason known only to the code.

Amazon Basics must have had at least a couple of humans involved to agree getting it branded Amazon.

Presumably it was humans who signed off on the premise of Amazon's Choice in the first place. If Amazon is so careless with their brand in that case, as a consumer I'd feel like a sucker if I trusted there brand to mean much when their employees are evaluating products rather than algorithms.

Maybe the algorithm seemed like a good idea at the time but later turned sour. If that's the case, why hasn't Amazon yanked the program? If they don't terminate this program when it performs poorly, I don't trust them to keep other programs in line either.

> Presumably it was humans who signed off on the premise of Amazon's Choice in the first place.

On the premise, sure. But on the individual items, I've always assumed "Amazon's Choice" meant "Best for Amazon", i.e. high margin, low number of returns (which would reduce margin).

Not necessarily what I would choose.

excellent point, it's Amazon's choice, not yours

Well I might have had trust in Amazon as a brand maybe a decade ago, as it got to the brand and product I wanted to buy pretty effectively. They've intentionally diluted it by filling their site with endless marketplace shite, and dodgy searches that hide brand leaders to show no-name garbage, and littering it with adverts for other no-name garbage. It's quite often I struggle to find the listing for the market leader directly, but end up there via a few "customers also bought/looked at" links. I go to Amazon less and less as a result.

So assuming Bezos isn't a complete numpty, that's intentional. Maybe Amazon's brand is completely disposable to fund Blue Streak.

Today I got more trust in Poundshop and eBay that I will get the right product easily than I do in Amazon. The old department stores, many now failed, sank or swam on the strength of their brand being a real indicator of quality.

Amazon employees have complained to Bezos about the state of Amazon's search. Bezos' response every time I've heard it is along the lines of "meh, I think our search is pretty good, quit your complaining."

Maybe it's intentional, or maybe he's deluded. I don't know. But either way, I doubt it's going to get fixed any time soon.

Maybe an urban legend, but I thought I read somewhere that the version of Amazon that Bezos personally sees is quite different than the one you and I see, due to all his various little one-off complaints and product micromanagement. Legend has it that engineering gave up trying to make sense of the requests and just gave him his own environment that does everything he thinks it should do. If true, then the search he sees might actually be pretty good for him.

Like all urban legends, there is likely a core of truth in the story. Certainly Bezos is known for micromanaging and arbitrarily overruling employees' decisions on everything from strategy to product design. Now, if a leader really does have great instinct, this can work out for the better (like Jobs). And I think in some areas, Bezos does (he has done surprisingly well with their IT strategy). But I know that in others he doesn't, and he just botches stuff (like many horrible Kindle design decisions).

Something seems off about that story. What's the point of requesting changes to a version of the site only he uses? I can't imagine he spends a lot of time surfing amazon.com as a regular user. Plus, not seeing the regular site means he might miss issues with the public website that he would want to change. Unless the point of the story is that Bezos doesn't realize the devs made a site just for him, but that's almost impossible to believe.

> Unless the point of the story is that Bezos doesn't realize the devs made a site just for him, but that's almost impossible to believe.

Yea that was the gist of it—when you log in as Jeff you (unbeknownst) get a different frontend, with all his various special cases and bad ideas that the PMs wanted to keep out of the real Amazon. It does sound incredible so probably false, but amusing to think about. I admit to having wanted to do something like that a nonzero number of times.

It’s suggesting that Amazon literally shadowbanned him.

This sounds like a fable invented by someone familiar with the story of the phony villages that Grigory Potemkin built along the Volga to impress Empress Catherine II.

Why do you need to trust Amazon? Just look at the reviews. Most AmazonBasics stuff has thousands of 4+ star reviews. It’s clearly distinguishable from the products with 15 questionable reviews.

Amazon reviews have become almost entirely useless once they began bundling like items. I've had cases of ordering an item only to receive a similar item from an entirely different manufacturer or seller. Looking at the reviews you'll find a number of different products being reviewed all under one product page which makes it impossible to actually gauge the quality of what you're going to receive

"Amazon's Choice" was given to products in gross violation of US health and safety regulations, as revealed by a previous WSJ article.

I really enjoy the LockpickingLawyer's videos, but I'd imagine that the threat model of the average Amazon (or Walmart/Home Depot/etc.) buyer is such that any basic lock is enough deterrence for 95%+ of scenarios. It could just be that their evaluation criteria don't match his.

I get the "thieves don't pick locks" thing, but I really think it's sleazy as hell if a lock marketed as "high security" can be raked open in one second. That's a low-skill attack. In this case he didn't even have to rake it, because the locks were unshielded: https://www.youtube.com/watch?v=kJ1_P5oqf6Y An unshielded padlock may as well be a warded lock like you'd find on a child's diary.

You are correct. Locks keep honest people honest.

Locks keep lock-picking ignorant and insufficiently motivated dishonest people honest too.

I don't think that statement makes any sense. Why do honest people need anything to keep them honest?

Probably something more like: locks marginally aid in diverting lazy / opportunistic thieves.

> Why do honest people need anything to keep them honest?

Curiosity and children.

That should really be the takeaway from any of his videos. Anything you buy consumer-grade can be cracked instantly by a skilled locksmith or within maybe a few tens of minutes by an average thief. The number of locks that I've ever really seen him struggle to pick can probably be counted on a single hand.

Like a safe - a lock buys you time, and hopefully the thief chooses a loud method of entry that attracts attention.

Thieves don't pick locks, if they want to get in something they either cut or pry their way in.




> LockpickingLawyer on youtube has done reviews on several Amazon's Choice locks and safes and they've all been abysmal borderline fraudulent products.

So basically Amazon's Choice locks are about the same as 95% of consumer locks on the market.

>they've all been abysmal borderline fraudulent products.

Isn't this just a property of most locks in general? I was under the impression that there are very few consumer locks that will stand up to someone with tools and a weekend of practice.

To be fair, they're generally around the same quality as Master locks. :D

Those two programs have nothing to do with each other.

It reflects poorly on the brand in general. If I can't trust Amazon's Choice, how can I trust anything Amazon decides to put their name on?

You can't, and you shouldn't. If this dichotomy is what raised the issue to our attention then we should be glad that it happened.

Like when prime simply meant two day shipping?

In fairness, very few locks can stand up to LPL for very long.

They recalled a quarter million power banks because they were catching fire.

Everybody uses the same factories and Amazon doesn't have better quality control than anyone else.

To be fair, Samsung had to scrap a whole phone model because of battery problems. The Boeing 787 suffered with problems of batteries catching fire (and according to some reports still does). It's a tricky problem to avoid.

With a power-supply it's not a hard problem to avoid. You have to hire independent engineers to evaluate the product design and establish testing procedures to verify that the product isn't unsafe. And you have to do QA and design verification during receiving on all batches of product to confirm that the manufacturer followed the design. I've never had a power supply catch fire and I've done some really dumb stuff in my lab. Frankly it's a matter of paying for UL/CE marks(including testing) and actually looking at the component layout, and Amazon doesn't strike me as the kind of company to respect that kind of QA/Verification work.

Batteries are a different story because they're basically tiny plastic bombs. Somehow Samsung managed to deliver almost 15 years of Android phones before having their batteries catch fire, and that was almost certainly a result of skipping essential QA/Verification processes because they've never had a problem before.

How is a power bank different than a battery? Isn't the power bank just several batteries crammed in a casing, with a power-out port?

Most modern rechargeable batteries have fairly sophisticated chemistry and thus charge controllers needed -- you don't just dump electricity into them blindly and then take it out. It's not quite rocket surgery, but there's a reasonable level of engineering involved, especially if you want optimal performance with the newer standards (which increase voltage on devices which support it, etc.)

Often times that "reasonable level of engineering" only needs to be slapping a ten cent IC on a board with some manufacturer default application circuit.

jschwartzi was talking about power supplies (i.e., devices that transform mains AC power to DC power), not power banks.

Ah, I read "power bank", as that's what ikeyboy mentioned above. And when you search (google) "power bank" the results are all about portable batteries for topping up phones and whatnot. Does Amazon even brand/re-sell power supplies like jschwartzi is talking about?

Really? Do people describe chargers or power supplies as power banks? Surely the 'bank' part of it implies some kind of storage.

I do hear chargers with a large number of ports called "power banks" - I think the implication is that it's like a line of ATMs serving many customers.

No, the implication is that people don’t understand the difference. These are the people who call every photo with people in a “selfie”.

Anecdotally I've spoken to people who compete with Amazon private label in electronics and they tell me Amazon doesn't care about quality, and that the factories they were buying from were known to be lower quality.

I've also heard the opposite about Anker - that they always get the best quality.

The issue, then, is how do I guarantee that the Anker branded product I'm buying through Amazon is genuinely Anker manufactured. I'm of the understanding that Amazon comingle stock from different supply chains in their warehouses so presumably I can't trust them to be supplying genuine hardware.

Most Anker stuff is sold by only Anker, so that wouldn't be a problem.

In that specific instance, Anker also sells directly from their website, so you can shop there if you're concerned about counterfeited merchandise.

Perhaps products should include a tiny circuit (e.g. challenge-response) that can prove that the product is genuine.

Anker are difficult to gauge, I've a few products of theirs, mostly bought a few years ago, with nothing recent - those have been excellent quality and value. Yet I've also started to notice precisely identical unknown brands for most of their products on Amazon.

So I no longer have any certainty. Are Anker merely badge engineering some random white label product, or are Amazon / Anker just not caring or able to do anything about dozens of clear counterfeits?

Are those identical products being sold as Anker, or under different brands? If it's different brands then it's not counterfeit just to make a product that looks similar to another one.

There's similar and completely indistinguishable, except for brand name and logo. e.g. their desk lamps, also their mice. Seems to be the case for almost every Anker product I remember looking at recently.

Nothing illegal about that unless Anker has a design patent.

You don't need a patent to protect a design. There's trademark, copyright and design protections, not just patents.

So maybe Anker are uniquely incompetent in selecting suppliers. Not specifying in the contract with factories not to copy whatever widget they produce for Anker, not registering any of their designs. Yet aside from a) products within the same group ostensibly from different brands and b) same idea but clearly made by someone else, few other companies seem affected. They'll have a few products counterfeited. Not most. It's the sort of thing that might encourage you to be very careful on third, fourth and subsequent products.

I suppose it makes a case to avoid Anker and the identical copies, as clearly inept. Few other companies appear to be quite so afflicted. I'm not convinced it's the answer though. Outside the purely generic: white T shirts, tungsten light bulbs and such, you see very few precisely identical products.

You said they were not copying the brand, so it's not trademark infringement nor counterfeit.

You keep using the word counterfeit when it does not apply. Copyright is also not applicable unless there's a work of art printed on the product (like cell phone cases).

Most brands making commodity products don't get protection for the design, because the design isn't that unique. Search for "fast chargers for Samsung" and you'll see tons of chargers identical to the Samsung charger except with a different name. Same for Apple.






There are well known, widely applied design protections that are not patents.

Here's the EU's:


Which protects "the appearance of the whole or a part of a product resulting from the features of, in particular, the lines, contours, colours, shape, texture and/or materials of the product itself and/or its ornamentation". It applies if they are novel and/or if they have unique character.

The equivalent in the US is a design patent.

I appreciated your response but as far as I can tell, they were asking whether Anker is badge engineering generic products or is a victim of counterfeiting, which I think is a slightly different question that I'm also looking for the answer to.

The only way it would be counterfeit is if they sell it as an Anker product or print Anker on the product.

My assumption would be that the same factory that makes Anker products is also selling the same designs to competitors - it's also possible that a different factory just cloned it.

Note that even if it's the same factory, they could have different quality control for different clients. So quality can differ even on identical designs.

AmazonBasics isn't any more trustworthy than any of the junk you find on AliExpress or at Wal-Mart/Target/Best Buy. (Except that it has a good return policy backing it, I think)

Amazon is at least liable (theoretically, at least) if they sell an AmazonBasics product that winds up giving my kids lead poisoning, and will have a lot harder time disappearing into the wind to avoid a lawsuit. They disclaim any liability for third-party sellers.

Sure, but will a lawsuit unpoison your kid?

Unless Amazon is currently testing products for lead before recommending them, which somehow I doubt, then the potential of a lawsuit against Amazon isn't actually protecting your child.

There's at least someone with deep pockets to go after, which is very much not the case for some random drop shipper in China.

It makes sense- if Anker's batteries start exploding, nobody will buy Anker's batteries again, and that's a significant part of their brand.

If Amazon's batteries start exploding, it's not quite the same magnitude. People will still shop at Whole Foods.

Samsung doesn't have a problem selling phones

Samsung also has a very long track record of producing cell phones that are deemed safe which neither Anker nor Amazon can match in batteries. You either need an extensive positive record to easily bounce back or need to be willing to write it off as an auxiliary business (e.g. if Amazon had battery issues).

People buy Samsung phones because they're good phones, people buy Anker batteries because they're good batteries. If they start exploding people will find some other, better battery brand.

Admittedly a phone that explodes is a bad phone, but Samsung can still sell its "good phone" brand the same way Apple can still sell its laptops.

My understanding, and this might just be marketing PR I honestly don't know, is that Anker sends their own QA people to the factories in China, so they're able to meet a higher standard. I always rely on them for battery stuff, and now USB cables since apparently no one else can make cables that reliably work to connect my phone to my car except them. I went through half a dozen different brands before theirs finally worked and remained working.

I’m sure Amazon’s competitors are the best source for unbiased feedback about the quality of Amazon-branded products.

>It's a tricky problem to avoid.

Its really not though, its just that between insurance and the courts its currently cheaper to enter products into the stream of commerce that will catch fire x% of times and hurt Y people costing $z, than it is to manufacture/supply/distribute/retail a product that won't catch fire in 100% of cases.

Hell even when z exceeds the cost of proper manufacturing, these companies are significantly more likely to spend money lobbying for changes to insurance and/or products liability litigation than fix the products to make the current formula work rather than spend more money on the cost of the product(s).

You’re assuming nothing bad ever happens with the “name brand” product, which is patently bullshit. Every consumer product I. The shelves is cost engineered to death.

I replied to a comment talking about defective Samsung and Boeing products...those are name brand products.

However, knock off products are usually worse, at least if you are burned by an exploding Samsung or die in a defective Boeing...you and/or your family will be compensated as these companies are identifiable and insured. If you are burned by an exploding knock off, odds are: 1) you won't even be able to identify the manufacturer or seller; 2) you won't have jurisdiction to sue the manufacturer or seller; and 3) they probably aren't insured and will just fold up shop and start anew.

To be fair, "bringing manufacturing back to America" would bring these problems back as well. Yes, it's the manufacturer's fault. It's really the company hiring the manufacturer who's at fault, though. Cash Rules Everything Around Me and all that.

If the company writing the checks can write checks to people who are going to cut corners, people will die. Full stop.

Amazon take egregious shortcuts on oversight for counterfeit goods, which they are compelled by law to not sell, so expecting them to suddenly practice due diligence on stuff coming out of a factory in China is just laughable.

Most US goods come manufactured from China. While China has a large counterfeit market, it's mostly restricted to inside the country.

>While China has a large counterfeit market, it's mostly restricted to inside the country

There are a huge number of online retailers where you can purchase chinese counterfeit items in the US. If you're in Seattle I can take you down a few streets where you can openly buy counterfeits as well, and I experienced the same in LA and New York. It definitely isn't mostly restricted to China, there is a massive market for counterfeit goods from China in the US

Compared to China, there really isn't. Literally everything in the stores in Chinese markets is counterfeit. I've been there. Fake gucci, fake airpods, fake drones, fake action figures, etc. I doubt you'll find any of this as wide spread, even in major cities, in the US.

And most of counterfeit items online are obviously from China or from Chinese sites. They aren't from the US.

And considering nearly all US clothing comes from China and is not considered fake and is largely the same with electronics and even toys, it isn't so much a quality issue when you get things from China. It more has to do with what company you get it from.

The other vendors who bought from that factory and rebranded them had the same problem did not issue a recall.

Amazon almost certainly has better quality control that most of the sellers on their platform. The vast majority of their sellers are extremely low effort, one or two person companies who take advantage of how easy it is to source and ship goods in the modern age.

If you weight all sellers equally, sure. If you weight by sales volume, I suspect they'd come out behind.

Anecdotally, all the amazon basics products I've tried have been garbage and were promptly returned

actually having an entity to do the recall is quite an improvement!

At least they recalled them! I don't think random no-name brand #12345 would have done that.

For most (70-80%) of the Amazon basic products I've tried, the quality and durability has been significantly lower than the product that it tried to copy. Not to mention no one wants wants their gear branded with Basic on it. I usually try to avoid Amazon basic products if possible.

Amazon Basics are white label products or specifically contract manufactured for Amazon. I am using an Amazon Basic keyboard right now, works great and was a few bucks cheaper than the Logitec Model. So far, I am a fan of them.

Not sure about that. 2 out of 3 Amazon Basics speakers I bought (cheaper, USB powered) died within a year. And none of the Amazon Basics USB cables I've ever tried support quick charging properly.

Clearly anecdotal, but I bought Amazon Basics USB cables that were absolute garbage.

They're the only brand of USB-C cable I'm willing to buy right now for my MBP chargers. The Apple branded ones all heat up too much and do the yellow discolorment thing, the Anker branded ones didn't hold up for more than a couple of weeks, and I had bad luck with some of the random brands I found, too.

My only complaint is I charge at 65W instead of 87, but it seems to only be slightly slower in practice.

But, it's also the nylon braided stuff, so it's probably built to different quality standards and by different people than the vanilla USB cables.

> Amazon Basics products

haven't had much luck with their Amazon Basics keyboards... went through 2 and then gave up and bought an IBM one...

Then why are they fiddling with the results to favor Amazon products, instead of just ranking by quality?

It's exactly the same thing that Amazon does with its product lines though (like Amazon Basics)

That's pretty much what Monoprice does too -- it contracts out to Chinese manufacturers for it's products (sometimes copying existing products [1]), but their stuff is generally pretty decent quality.

[1] https://www.cnet.com/news/monoprice-a-tech-consumers-best-fr...

I used to wonder why amazon didn’t prioritize “name” brands as a proxy for quality but then I realized all they are doing is sourcing cheap crap too. So what’s the difference if it’s a one man shop or a big name if the original source is the same crap. Amazon is merely a exaggerated reflection of just how bs the retail marketplace is these days unfortunately.

I was told by an ex-amazon employee that amazon basics were all designed in-house. As in, they're explicitly not white-labels.

OT response to a killed comment (https://news.ycombinator.com/item?id=21009618)

HN seems to have had an influx of incentivised accounts (via third-party services). They're putatively gaining some sort of credits. That's been discontinued at HN's request to at least some such services.

Best response is to flag the comments/posts, and if you see egregious abuse, email the mods: hn@ycombinator.com

(I've emailed re: the earlier thread.)

That's not the case. Take a look at amazonbasics monitor arms - they're rebadged ergotrons.

I think at one point, it was the case that they were made in-house, when they had a limited, well-tested selection of AB products, but recently (as the emphasis on profit over brand reputation has increased) they've begun also slapping it on white-labels.

Amazon analytics firms(JungleScout etc) specifically offer direct search to Alibaba from their apps, for private-labelling

I've seen Amazon prices go up while Walmart Online has been cheaper for household items. On speciality electronics, I don't think anyone would be surprised to know Amazon is more expensive.

It's an ancedote sure, but back in 2012, we shopped only at Amazon. Now they are no longer King.

I think Amazon can be quickly replaced.

I was attracted to Amazon only because of lower prices. That was it and now it is no longer the case. As soon as another big player steps up and offers lower prices and simple UI there won't be a need for me to shop on Amazon.

Except its not just the lower prices that are important -- the quick order processing and shipping are a huge reason why Amazon is succeeding.

Living near a metro area, I can get items from Amazon items within 24-48 hours (with Prime). Sometimes it even arrives later the same day.

Plus the whole free shipping (as long as you're Prime) thing..

The free shipping is weird....I recently noticed that my father was looking up something he wanted me to order for him....his price was less, same item and amazon seller. I logged in and boom my price was $3 higher on a 20 dollar item. So, I'm not sure how "free" the shipping is anymore.

I do agree that fast shipping is a big part of amazon but I think another big player could match the processing speed.

Amazon has multiple sellers with different shipping options and prices for most items, and always tries to show you the best "deal". This sometimes includes the likelihood that you prefer the two-day shipping.

The listing being offered to you father probably wasn't eligible for prime (not shipped by Amazon) so the price+shipping was lower than Amazon's price+non-free-shipping (and the third party was likely intentionally undercutting Amazon to be shown first). Once you signed it, it offered you the one with prime shipping because the total was cheaper.

Same seller Amazon.

Was the shipping time the same? Perhaps the seller is closer to your father than you. Was it prime 2-day? Or was it FBA i.e. Shipped by Amazon? I think you'll need to provide more details before we can conclude Amazon is price gouging.

We are 15 mins away from each other. It said sign up for prime to receive 2 day shipping on his end I believe.

I may be wrong. I will try to take some screenshots another time, as it seems like nobody else noticed, therefore, i may be in the wrong here.

I've been told that amazon might do "personalized pricing". Friends have told me their friends come up with lower prices in other locations.

Target was caught doing this. People with location services turned on using the target app would find pricing for an item jump up as they approached their local store.

search for "The Target app price switch: What you need to know"

I am pretty positive amazon is doing "personalized pricing". It was the exactly same item, sold by amazon. I'm already at the point where I want to cancel it, so as soon as someone remotely competitive comes along I will jump ship.

I too have noticed this. I recently bought a new keyboard and mouse and got them both at best buy for cheaper.

When I spilled water on my keyboard, I actually walked into a Fry's and got a better deal than anything online, for a genuine Microsoft keyboard.

I've noticed this on many occasions in the last month. I bought a mouse that Amazon had listed for $39. I walked a block and bought it from Office De/Max for $10 cheaper.

I wanted to get a sweater shaver. Amazon had it for 22. I bought a NIB one from Ebay for $12.

As far as I am concerned, the only thing Amazon has going for it right now is that it is a a one stop shop. That's worth something… how much? I'm not sure, but I know I'm buying a hell of a lot less stuff from Amazon now than 2 years ago.

> for a genuine Microsoft keyboard

Also you knew it was Genuine. I'd love Amazon to do a "Guaranteed Genuine" label or something, but I can see why they don't. I used to buy everything on Amazon, now I only buy stuff that I'm willing to accept might be counterfeit.

Frys is one of the few retail places that consistently beats Amazon. I recently built a PC and almost every part was cheaper in Fry's than Amazon.

With Amazon, you sit your butts at home and get what you want without getting stuck in traffic and waiting in line to check out in-store just to get a $20 keyboard.

Nevertheless, it remains questionable how this change would be a fair competition for Amazon sellers, not just the Alibaba private label sellers but also all the sellers with popular products.

You missed the "Online" part of "Walmart Online".

Amazon is far from unique there. As the OP says, Walmart has a sturdy online offering, though it also relies on "marketplace" sellers. I've started ordering a lot of online stuff from Target and I've been very happy with it. Cheap shipping and reliable quality.

Still, they are the monopoly marketplace online. They should be doing _everything_ to avoid looking like they are abusing their monopoly position to muscle into other fields. The fact that they don't seem too bothered just seems to indicate to me that regulators are not prepared to act on them.

Really the rule should simply be that if you operate a market place you can't sell on it. Full stop. Then we could simply be happy that amazon is finally improving it's search and/or the quality of its listings.

I think a lot of people are missing the point that Amazon controls so much market share now that actions that aren't anti-competitive if you have 1% market share are when you control 50%+.

How is amazon a monopoly?

Last time I checked there was a ocean of e-commerce stores on the internet all selling the same stuff

When Microsoft got busted for being anti-competitive, you could still download Netscape Navigator and use it.

Amazon still has quite a ways to go. Consider that Microsoft had:

- 96% of worldwide OS marketshare. Even Amazon doesn't come close to this level of domination in retail or cloud.

- Forcing OEMs to purchase Windows licenses for all PCs sold regardless of whether or not customers wanted a PC without Windows.

- Not only pre-installed IE, but provided IE with inaccessible and undocumented Windows OS APIs to give it functionality that just wasn't possible for Netscape to implement (like ActiveX).

Anti-competitive behavior is different than having a monopoly

It is definitely not a monopoly...I for one goes to Wallmart.com frequently depending on price.

Disclaimer: ex-Amazon employee.

I'm done with buying stuff from third party sellers on Amazon. If the seller is not amazon.com, I am not buying from Amazon. Fulfilled by Amazon is not good enough. Unfortunately, the only way to get a seller option is to pick an item department. I wonder why they would bury such a useful feature. It should be a box you can tick for the whole site.

Are items where the seller is Amazon immune from commingling [1]?

[1] OT: I wondered why it is "commingling" instead of "comingling" (like "cohabitation"), or "colmingling" (like "collaboration"), "conmingling" (like "concur"), or "cormingling" (like "correlation"), so looked up the rule.

The com-, co-, col-, con-, and cor- prefixes all mean "together". Which is used generally follows this rule: "Com- is used before b, m, p, also occasionally before vowels and f. The following variant forms occur: co- especially before vowels, h, and gn; col- before l; cor- before r; and con- before other consonants". See https://www.lexico.com/en/definition/com-

One thing I run into after filtering by seller is where Amazon is selling one color or size of a product, but if you change the size or color options, the seller changes.

from the online etymology dictionary,


word-forming element usually meaning "with, together," from Latin com, archaic form of classical Latin cum "together, together with, in combination," from PIE *kom- "beside, near, by, with" (compare Old English ge-, German ge-). The prefix in Latin sometimes was used as an intensive.

Before vowels and aspirates, it is reduced to co-; before -g-, it is assimilated to cog- or con-; before -l-, assimilated to col-; before -r-, assimilated to cor-; before -c-, -d-, -j-, -n-, -q-, -s-, -t-, and -v-, it is assimilated to con-, which was so frequent that it often was used as the normal form.

Some advice (from a company that sells our own products on Amazon): buy only from Amazon or the manufacturer. When buying from the manufacturer, look at the 1 and 2 star ratings. They will be the best barometer of product quality.

Is there a reliable way of determining that the seller is the actual manufacturer and not a copy cat name?

In my opinion, it's pretty safe to assume that sellers misrepresenting themselves as the manufacturer won't last long on any platform. Manufacturers are all pretty aware of Amazon at this point.

I think your comment illustrates exactly why this is a win-win for Amazon: on the one hand they take a cut out of (cheap, low-quality) third-party sellers on their platform; on the other, quality-conscious consumers like yourself simply filter for "sold by Amazon" instead of leaving for a non-Amazon website. So Amazon wins either way.

This is going upstream against Amazon's strategy, they're trying to move more sellers to third party and FBA [0]


Hence why Amazon seems to be their darndest to hide that an item is a third party seller in search results. Last I looked there was no way to filter search results to only have Amazon seller.

That's jerky.

Yeah, like I said, you have to pick a department first, before the option to filter by seller appears. (Which is extra annoying, because it is not always clear which department something is going to be in!)

They do care about the quality of their own products. I posted a negative review on an Amazon product, and they called me(!) so that I could further elaborate. It was very odd because they called within an hour of the review. At some point I must have given them my phone number.

This was a review for their TV Cube. I was trying to buy something with good voice control to allow a paralyzed person to browse YouTube, and TV Cube could not do it (maybe it will be better in the future..).

I suspect the only reason I got the call is that TV Cube is in active development.

I posted a negative review on a FBA product (~$100) that arrived super late and damaged. I got called to offer me $20 to take the review down. Didn’t respond, they somehow got my review taken down anyway. That was the first time I realized how bad Amazon was getting. Kind of surprised this is something Amazon does too though; I figured only crappy dropshippers would engage in that

I once posted a negative review on their Basics HDMI cable, which had absymal shielding. It went "under review" immediately, and a few days later the review just silently vanished without a trace.

What is wrong with Amazon (or any vendor) following up on a bad review? If they’re offering incentives to take it down, of course that’s a problem. But engaging with the customer and identifying faults in detail seems like a plainly good, consumer-friendly and win/win behavior that every brand should practice.

That said, I’m not sure a third party seller can get my contact info as easily as Amazon can, so that part seems a bit unfair.

The problem is not "following up on a bad review" the problem is "I got called to offer me $20 to take the review down. Didn’t respond, they somehow got my review taken down anyway"

That's a great example of how Amazon abuses their monopoly power as a marketplace provider to boost their vendor business. "Calling you" is something that they do for their benefit, but go to great lengths to prevent 3rd party vendors from doing, by blocking vendors from getting access to your phone number and not providing a formal opt-in if you want to share it.

If you're still looking for a good way to browse YouTube - I've made a Chrome extension that let's you browse the web using voice control - https://chrome.google.com/webstore/detail/lipsurf-voice-cont...

Hope this helps.

I was hoping from something like Roku- basically an appliance, not a computer. It should be always listening (not tap to listen), and screen should be far away for casual viewing, not in front of your face like a laptop which causes eye strain.

The TV Cube is almost there, the problem was that the voice commands are not built into its OS, instead each app has to implement them and the YouTube app didn't. It means the voice commands only work well with the Amazon native apps.

Voice is really in an abysmal state on all platforms. Pretend you can't touch anything, then read this for the fun:


For appliances, you have the usual problem of not being able to accept terms to use institutional WiFi (lack of a good web browser).

Also for computers with a screen in front of your face, there already is a better solution: eye tracking.

But there is an annoying secondary problem with YouTube on a laptop: I can't lend my YouTube Red account (for an ad-free experience) to someone without also being fully logged into Google (they would have access to my email). With something like YouTube on Roku, this does not matter since you are only logged into only a single app. Google does have a family plan, but it's not cheap.

The extension can always listen- it has a wake-word just like Alexa, Siri et al. "hey LipSurf" in the premium version. It can be used on a media PC/TV, you would just need to setup your microphone to listen from wherever you sit or wear a wireless headset.

It’s odd to me to think that something which is user-centric could be “grossly unfair” to vendors.

If you view vendors on the platform as existing to serve the users (as I do), the contradiction evaporates. If you view users as existing to serve the vendors, then it’s possible.

Something can be unfair to vendors in a way which is bad for consumers. Amazon's own products might be, for example, more expensive or worse quality.

That would then not be user-centric.

But it also would not be begging the question. One should not assume that "good for Amazon" is always user-centric.

There are things known as two-sided marketplaces. This isn't novel; malls and similar have existed for a very long time.

I get that US culture is heavy on "the customer is always right"[1], etc. but two-sided markets don't exist without recognizing both sides.

[1] In reality, that ends up being more of an employee control mechanism than a dedication to customers, but that's a different topic.

"the customer is always right" means the customer has the money in his pockets to spend, and you can't argue with the sales figures at the end of the day. It sounds like guidance on dispute resolution but isn't exactly.

I'm mostly referring to established companies that have reputations as-good-or-better-than AmazonBasics and I would be more than happy to see them in the same premium position.


Here in Australia AliExpress feels like Amazon with faster shipping and more honesty.

Although Amazon now has an Australian entity, though I’m not sure how popular it is, maybe as (non-) popular as Amazon...

> Otherwise, Amazon feels like AliExpress with faster shipping and better English.

I canceled prime some time ago, because I realized I was getting significantly lower quality products than Walmart. Its become a junk store.

At this point, anecdotally, it feels as though the top comment on almost every article I see on HN about Amazon is some variation of this complaint.

Has anyone done any analysis on the HN posting dataset to see if that happens to be the case?

And if that is the case, does anyone have any insight into why that might be?

Amazon used to have the best service, best quality products, and best prices, so practically every HN user loved them.

Now they're wavering on all three of those fronts, and I guess that fact really bothers most of us

> Amazon used to have the best service, best quality products, and best prices

They used to usually have the best prices on the products they had, and the widest selection of products. They didn't always have the best quality products (which were sometimes exclusive to non-Amazon channels), and outside of return policy (which was very generous, probably specifically to cover all the other glitches) their service was nothing special at its best.

Let's not view past Amazon through rose-colored glasses.

I'm not disagreeing with the premise that Amazon has issues. But I do not see a similar pattern with other companies and services. Of course, this is anecdotal, but it does seem significantly higher with Amazon itself.

It is possibly that most HN users purchase a lot via Amazon?

Is it a small but vocal group of HN users that have a grudge because they had an unsuccessful drop shipping operation that was harmed via Amazon?

Is there some competitor(ie. Walmart) that is trying to push an agenda?

It just seems high compared to other services, so I'm curious into additional insight into why Amazon, specifically, has this pattern when other services with issues do not.

I personally feel like it may just be that most HN users are, or were, heavy purchasers from Amazon. But I'm just looking to see if maybe there is a more insightful take on things.

I'm one of the naysayers. I have ... probably a north of $15k lifetime spend on Amazon? For a period of years, particularly as I got busy with my career, Amazon was where I shopped by default. And I had a pretty shocking problem with a charger with a fake Intertek (UL competitor) mark. I told Amazon; they refunded me and kept selling the product. My partner also received obviously fake makeup from Amazon.

Chargers and chemicals that go on your face and inevitably get ingested are obviously some of the most dangerous things to be fake, and Amazon clearly doesn't give the tiniest shit.

I repeat the story around here in hopes of saving someone else (potentially quite a lot!) of grief.

I used to order a ton from amazon, I now strongly dislike the company. Why is that?

-Prices used to be universally pretty good so I could pick an item and order without much outside research. Now the prices are universally bad to the point that I have to do lots of outside research before ordering which ruins the convenience that I previously enjoyed

-The review system is awful. Previously you could click a product and trust that the reviews were for that exact product, now sometimes reviews and products are bundled together under a single page (even if the products/manufacturer are not really the same) making reviews virtually useless. Again ruining the convenience and requiring more research

-Shipping used to be reliable. Towards the end probably half my prime shipments showed up a day later than the "guaranteed delivery date" and I live less than 30 minutes from their Seattle office

-I don't at all trust the people they use to ship. My last package some idiot in a complete junker filled entirely with boxes drove very quickly over the sidewalk and parked partially at an angle in my lawn and proceeded to throw the box onto my porch and then sit in the car for another 15 minutes on my lawn

-The product bundling has led to me getting items entirely different than what I actually ordered, which again ruins the convenience that I appreciated and forces me to make returns and wait even longer

-And on a personal note, based on what I've read and heard from amazon employees, I dislike bezos as a person and businessman and don't want to support his business

I wrote the comment and I agree, although in this case it's more relevant to the topic than it often is.

I mean, I prefer AmazonBasics products because I've been burned enough times (occasionally literally) by cheap off-brand "Chinesium" goods.

So putting them at the top of the search suits me.

I think the big changed needed on Amazon is the "Seller". With their commingling of all products with the same SKU, "seller" is an irrelevant term. If people could review actual sellers, it could put a dent in the knock-offs. I'm not sure if there are just enough people who can't tell the difference or don't want the trouble of returning it to make this a profitable strategy for everyone.

What does commingling mean? In real world terms?

I ask because I'm unclear if shared SKU is a physical thing, a logical implementation detail, or some mix.

Is there a bin full of white 3' USB cables of the same type, regardless of supplier?

I had the impression that fulfillment centers weren't organized by product. Everything is everywhere. The robots retrieve the bins of whatever from wherever for the pickers to grab from. If this is mostly true, I'm not clear how similar white 3' USB cables get commingled.

>Is there a bin full of white 3' USB cables of the same type, regardless of supplier?

This is my understanding, yes. If something is "fulfilled by amazon" common stock has one bin/location and is not differentiated.

Correct. Fulfilment is UPC based and independent of seller, for all FBA products.

This doesn't sound right. Even if two different sellers are selling the exact same brand manufactured product (say, an Android Phone), via FBA, when a customer buys from seller1, they should get the Item1 which was actually supplied to FBA by Seller1. They cannot get Item2 which was supplied by Seller2. When the customer returns the Item1 for manufacturing defect etc reasons, it has to go back to the Seller1. This is because Item1 has "manufacturing date and batch number", may have "imported from" etc that are different from Item2 by Seller2. Seller1 may have gotten it with different pricing terms etc.

When you say "right", you need to distinguish between "accurate" and "reasonable". The OP has correctly described Amazon's approach to commingling (claimed) SKU's. And you have correctly concluded that policy is likely to lead to bad outcomes for both buyers and sellers. Whether it's a bad policy for Amazon as a corporation remains to be seen.

This is what happens though. Now you understand why counterfeits are a problem.

Amazon's reputation is pretty damaged in my eyes. I have rarely used them for electronics anymore as you can't trust anything. Even at work we used prime to buy certain items and I stopped it.

Example: Last week two symbol barcode scanners used in the erp system died. I look up the same model on newegg and see that sold and shipped by newegg it was about $120. Amazon had multiple listing in the $60 range and checking reviews I see things like "died in two weeks", FAKE, "died and returned to symbol only for them to say it was a fake and they were refused service or replacement". How do you build trust with shenanigans like that? No thanks, Newegg got my money.

Amazon seems to be playing oblivious to all this mainly because people are STILL using them. So as long as they are making money they can afford to lose a few "picky" customers here and there. The rest are happy to buy trash because they save a buck. Capitalism at its finest.

Sadly Newegg is following in Amazon's footsteps with it's affiliate program. You have to choose Newegg as the seller or you run into the same issues.

As soon as Newegg starts mingling stock like Amazon does, then we'll have to go back to big box retailers to ensure we're getting the item we're paying for.

In 2016 a company called Liason Interactive bought a majority stake in Newegg, personally I think to try to turn newegg into an electronics version of amazon.

Since around then Newegg has been garbage, and continues to become worse.

I think any seller like amazon or newegg that turns into a marketplace/platform is trading their reputation for the potential of a cut from a much larger market, and they probably do this knowingly.

At least B&H and Adorama are still clean, right?

Pretty sure they're actual giant brick and mortar stores in NYC. Not proof against buying out but different. I dont buy enough from either to know.

Small nitpick, but what you are referring to is not an affiliate program. An affiliate program is where a website gets a cut of the sales for providing links to a retailer's site. So, The Wirecutter makes money by using affiliate links to Amazon and other retailers on their product review articles.

Yeah you're right. I'm not sure what the correct term is.

"3rd-party" or "3P" sellers.

I'm not sure either, tbh. Perhaps 'marketplace' or 'platform'.

I don't buy from Amazon simply because they've become a dump of all things crap for years. Their UI is horrid an tricks you into clicking on ads by putting them in product listings. And they treat their employees like dirt.

(I can only guess you are American) - American experiences with Amazon are so different to mine over here in the UK it's incredible. I buy tonnes of different stuff from Amazon(multiple hundred orders last year) and I have never ever gotten anything counterfeit or had any issues. In fact every time when their 1-day delivery arrives late they just extend my prime by a month, no questions asked. And yet every time I go on HN it's 100% negative, stories about unreputable sellers selling fake stuff - this is just not happening outside of US for some reason.

According to the Youtuber "serpentza", EU law requires Amazon to display the country of residence of an Amazon seller, whereas the US has no such law (and Amazon chooses not to display the information in the US). If counterfeiters are concentrated in a few countries with bad reputations among consumers, counterfeiters have an incentive to choose Amazon's US store.

Amazon India has a counterfeit problem if you are not careful. I’ve had counterfeit batteries, chargers and skincare items. Though delivery issues have never happened.

I’ve to keep my guard up when ordering from Amazon. It’s no longer the easy convenient and cheap option.

I've certainly had fake products from Amazon UK. Certain categories of products are very likely to be counterfeit, while others aren't. For example there were lots of apple replacement headphones which are much too cheap.

I don't know about Amazon UK, but pretty damn sure my Amazon DE (Germany) is similar. Degraded. I used to shop a lot on Amazon a decade ago. Now I am losing time scrolling through search results filled with garbage sellers which get promoted in the results. In the past year I went with Amazon Choice 3 times and got low quality products. I go to other online stores for electronics and other stuff. I only buy books on Amazon now.

Same here, have placed hundreds of orders on Amazon UK in the last few years and have never really had any problems. The rare few times i've had problems then a call to customer support has usually had the issue resolved right away and quite often with a discount voucher for the next shop.

It's likely related to

(1) US market is largest "single-language * consumer spending" market, so almost everyone outside of US/UK market puts effort in US first.

(2) USPS/UPU offers nearly 0-cost shipping for China to US. Can you ship a 2oz packet from China to the UK for under $1?

I don't know specifically about the UK, but the zero cost shipping from China isn't a US thing. It's an international agreement, and I've seen things being shipped for free from China to both Europe and the Middle East.

Woah. In this bigger picture, amazon and everybody else is doing the last mile for Fulfilled By China!

Amazon France is filled to the brim with Chinese rubbish that makes searching for anything a chore. It's still fine when you've got a specific item in mind, though. Amazon pricing and parcel delivery is still top notch.

US Prime member here. Never had any problems with fake stuff. One time, my order was stolen and replaced with something of similar weight. I called Amazon right away, and they refunded my purchase. When I need to return something, it's easy.

Its interesting. I bet it also has to do with what you're buying that makes you more or less likely to hit a fake.

I live in the US and buy a ton of stuff on Amazon for my business and haven’t noticed a counterfeit problem. I think there are just lots of loud voices from people that have gotten counterfeits or just in general don’t like Amazon.

that's just how neoliberalism works. In heterogeneous markets, lose money and bribe users to monopolize. Once you monopolized, all bets are off.

Amazon: fast shipping, easy returns. That's literally the beginning and end of their entire value proposition. If any other company can fill that niche, they can have my money with no regrets.

AliExpress: a massive company that somehow never bothered to observe a new user using their software.

Why the heck does the ordering window have 2 or 3 “Confirm” boxes that I have to press?

And if I haven’t, why can’t it just tell me what’s not confirmed when I hit “Submit Order”?

I've had the misfortune of needing to run some FB and Twitter ads recently, and it baffles me how completely unusable and unfriendly these platforms are for the only thing that makes them any money.

In the long term, it's not user-centric at all.

Amazon pushing its own products drive 3rd-party resellers out of business and eventually, no other choices for consumers.

Good thing people love Singaporean electronics bazaars.

Well, products which sells Amazon by yourself, not by third-party sellers, are mostly trustworthy.

Aliexpress - always been a Russian roulette.

I would compare this to a supermarket allocating shelf space to maximize its profits, either by placing its own brands front and center or by featuring brands that have made a deal for prime shelf placement. I don't see this as scandalous or even new.

Coincidentally, Amazon brand products are usually pretty good in my experience, so this might not be a terrible outcome for users who have already decided to come shop at Amazon's store.

EDIT: I didn't explain this well at all because I couldn't find the episode and haven't listened since it came out, I highly suggest someone better than me find the episode because it makes much more sense and has WAY more information than me.

There was a planet money episode about this exact comparison the other day. Basically it comes down to:

When a grocery store puts something on it's shelves, the store itself bought it from the manufacturer. They have already made their money. On Amazon, manufacturers don't make money when the item is listed, they make it only if and when a customer buys the product.

When a grocery store makes its own novel product and puts it on the shelf, it's taking a risk. If they make those products, but they don't sell, they just lost a bunch of money. Or, if their product is a competing one with an existing product, they know that products like that can sell, but now they have to focus on outselling the original product. When Amazon makes its own product, most of the risk has been removed. They pretty much already know it sells well on their platform, and they have enough money that knocking 5 dollars off the price, making it prime recommended, and putting it at the top of the list will cause it to beat the competition 9 times out of 10.

I'm not saying any of this is fair or unfair, because I'm not an economist so I don't believe I have a full understanding of the situation.

I tried to find the exact episode but it seems I can never find them when I need them.

> When a grocery store puts something on it's shelves, the store itself bought it from the manufacturer. They have already made their money. On Amazon, manufacturers don't make money when the item is listed, they make it only if and when a customer buys the product.

It's way more complicated than that. Manufacturers pay stores to carry their products, feature their products in special places in stores, get forced to take buy back unsold product, get paid way later on invoices, etc etc.

Only certain big box retailers do that, like Best Buy, whose business model have them leasing floor space in their physical locations, which has tangible scarcity.

Amazon is not leasing retail floor space, so to GP's point, any comparisons between Amazon's open platform and traditional physical retail spaces are moot.

I think retail stores controlling what you see based on how much money they get which is quite similar to Amazon controlling what you see in a search result based on profitability, but I guess we can agree to disagree. However, it's not just stores like Best Buy. Your local grocery store almost certainly makes a large percentage of their profit from companies paying for shelf space. End caps don't come out of thin air.

Again, comparisons with physical retail are moot because, in your grocery store, nobody can walk in off the street and start selling off the shelves. The grocery store is not an open e-commerce platform but a curated service with physical scarcity.

People don't have an issue with Amazon default sorting to best selling either. The problem is that Amazon is slowly pushing out the competition on their platform to focus their own products and labels. If there's any analogy, it would be similar Google removing search result links to Bing or Yandex.

> Again, comparisons with physical retail are moot because, in your grocery store, nobody can walk in off the street and start selling off the shelves. The grocery store is not an open e-commerce platform but a curated service with physical scarcity.

So, if Amazon marketplace was an invite-only, curated marketplace and not an "open" marketplace, this wouldn't be a problem?

>When a grocery store puts something on it's shelves, the store itself bought it from the manufacturer. They have already made their money. On Amazon, manufacturers don't make money when the item is listed, they make it only if and when a customer buys the product.

That's not how it works for a some perishable products in grocery stores. For example, bread is stocked daily by the bakeries themselves. Same thing with potato chips.

If a grocery store has their in house bakery up front right when you walk in selling bread, and the vendors bread is all the way in the back, is that unfair to the vendor?

>If a grocery store has their in house bakery up front right when you walk in selling bread, and the vendors bread is all the way in the back, is that unfair to the vendor?

That would be for the vendor to decide when planning out where to sell their product I guess

Right, just like all of the sellers on Amazon know that they have to take potential competition from Amazon into account when deciding how to participate in Amazon's marketplace.

> For example, bread is stocked daily by the bakeries themselves. Same thing with potato chips.

The store still buys those items from them. Some bigger stores will force the vendor to offer a buyback guarantee, but while the product is on their shelves, the store owns them.

This isn't true in most cases. Amazon does buy stuff wholesale through their Vendor program. Almost all sellers are also buying wholesale apart from manufacturers going direct to consumer.

If it is shipped & sold by Amazon, Amazon already paid for it from their supplier. If it is shipped & sold by SomeOtherStore, generally they bought it already from someone. There are a lot of dropshippers also and that is a different story.

Amazon similarly protects itself with onerous contracts that can force suppliers to eat the cost of unsold products at times, and does whatever it can to avoid buying unproven products.

Grocery stores and other retailers in general can be protected by refund policies and buyback policies so they are not necessarily taking as much risk especially on packaged products with long expiry dates. They can also liquidate stuff that doesn't get purchased to recoup some money.

> When a grocery store makes its own novel product and puts it on the shelf, it's taking a risk. If they make those products, but they don't sell, they just lost a bunch of money. Or, if their product is a competing one with an existing product, they know that products like that can sell, but now they have to focus on outselling the original product. When Amazon makes its own product, most of the risk has been removed.

The grocery store's risk on store branded products is about the same as Amazon's risk for Amazon brand products. They have the data to know what sells and what doesn't, they have control of the store layout, and they also have pricing data. There's really no major differentiation besides the physical store front and how manufacturers "rent" space.

But the shelves of Grocery stores are different: you cannot just change things around all the time without your customers complaining or going to another market with better offers. The amount of shelves is more or less constant throughout the life of a store and promoting your own brand often means you lose out on the money others offer you to get a good spot.

On Amazon there are as many shelves as there are product categories and the thing has much much more fluctuation.

What that means is, that a "promoted" product is sometimes the only one which stays at a fixed spot, while all all the others are to be found on the miscellaneous-pile.

> I'm not saying any of this is fair or unfair, because I'm not an economist so I don't believe I have a full understanding of the situation.

It’s unfair.

Supermarkets purchase the inventory from suppliers so they have an incentive to move everything that's in their stores. It costs amazon nothing to host 3rd party inventory so they get to prioritize whatever maximizes their profits, including screwing over their top sellers.

A better analogy would be a walmart in a small town hosting a bunch of small business to showcase their products, then kicking out the top sellers and replacing them with a store brand version. You could argue that those producers should just open their own store but most people won't go out of their way to a different store to buy paper towels.

Well yes and no. Most grocery chains have more than enough weight to make sure they can return whatever they can’t sell. And the pay their suppliers so late that 99% of the time they’ve already made the sale before even paying for the inventory

The product is still taking up their limited shelf space so it's in their best interest to see it get moved. Amazon made their business on the long tail of products that rarely get bought but in aggregate add up to a large portion of total sales because they don't have the same physical constraints.

Amazon also has an equivalent of shelf space: search results. They are just as incentivized to maximize revenue per customer search as super markets are incentivized to maximize revenue per shelf space.

Search results are an interesting comparison because their consumer-facing functionality is the same: They both have some limited consumer attention while they are present, and they both want to guide that attention to products that make them more profitable.

Except the analogy falls flat when you actually compare the implementation: Amazon's costs to host listings is negligible to negative (they may get more value from having extra listings than it costs to serve them), but that is far from true for grocery stores.

Grocery stores have a very small, finite, shelf space compared to Amazon; you can put a lot of items in the "..." after page 3, but grocery stores have to expend labor to count and organize each item at least once a month.

Yes stores may be able to return non-selling items for a refund, but do you think it cost them nothing while it was sitting on the shelf? What about the labor of stocking them, cleaning them, heck even packing them back up to return? On Amazon anything that doesn't sell well automagically gets shunted into the depths of page 10+, and they can keep them there indefinitely, at no cost.

Stores have a fixed cost associated with every item stocked, this gives them an inventive to sell every item they stock even if they prefer to sell some items over others. But they still want to sell it, even in they have to discount it by huge margins to get rid of it. By contrast Amazon doesn't give a piss about any one of your items in particular getting sold, it can stay there forever as far as they're concerned.

I like to say, a sufficiently large quantitative change manifests as a qualitative change. By that, I mean yes the only "real" difference between these scenarios is some of the costs are different, but how those costs become incentives when you have multiple parties actually matters.

I agree that online retailing is fundamentally different, overall. But it is similar in a way that was relevant to the comment I was responding to: Amazon also has an incentive to optimize search results do sales revenue.

Grocery stores don't operate as a "marketplace" though. Grocery stores curate their offerings, vet vendors, deal with returns etc...

Amazon is more like shopping mall that decides to start operating their own stores and competing with their tenants.

You have a point but I think the fact that grocery stores sell private label goods is the counter-point. Grocery stores re-package goods like rice, beans, paper towels, etc. to compete with their vendors all the time. We call them supermarkets, right? A grocery store is simply a more organized open market. Which is very comparable to Amazon.

I think the problem is that they present the results on good faith that "these results are the best match for you based on your search", not the most profitable for them.

I just ran a search and the default search filter was "Featured", which is so ambiguous it could mean anything, so it seems like a classic bait and switch that played out over the course of a decade of consumers getting the best search results based on reviews and sales.

> A grocery store is simply a more organized open market.

That’s not true though right? Don’t grocery stores buy the products that are on their shelves and they are reselling them? That’s fundamentally different from a marketplace.

> Don’t grocery stores buy the products that are on their shelves and they are reselling them?

No, not usually. Usually the seller pays the grocery to carry items, and the seller owns the items until sold.

For some products the seller even stocks the items on the shelves.

I think that's true for most goods, but there were definitely brands that stocked their own shelves at Publix when I worked there.

That said, what brands got that special treatment was very much decided by Publix, so they were still curating the selection, they just weren't paying up-front for the goods or responsible for keeping those shelves looking good.

Generally Publix still owns that inventory though (even if they have a buyback guarantee) My dad worked for Lance snacks when I was a kid. He stocked the shelves, but the stores paid him for the product.

Did they pay him for the product before or after it was sold? I never really knew which way it went, but assumed that since the entire thing, except checkout, was handled by the rep, Publix never really owed the product, they just sold it as if it were on consignment.

They paid him before. But really big stores would buy the whole thing on credit.

They definitely owned the product, while it was on their shelves.

Even if a vendor has a buyback guarantee for expired product, if someone were to break in and steal all the product, its the store who is liable not the vendor.

Some grocery stores, like Kroger, sell their own branded products in their stores.

Exactly. Stores like Kroger use their data, make generic versions of popular items, and sell right next to the brand at eye level. Amazon just does it at a larger scale.

>Grocery stores re-package goods like rice, beans, paper towels, etc. to compete with their vendors all the time.

That was the original point I was arguing against.

My point is that grocery store is not a good analogy because Amazon is not the same as a retail store, they are a combination store and marketplace.

I would argue that a grocery store is a combination store and marketplace in that case. Stores have plenty of in-house brands, they also have racks of goods that are stocked and sold by third parties wherein they get a cut.

To be fair, I think I would be more comfortable comparing Amazon to Sears in it's heyday.

>, they also have racks of goods that are stocked and sold by third parties wherein they get a cut

I'm sure that exists, but it's not common. Grocery stores often charge slotting fees, but that's not the same as renting shelf space--the store still owns the product (even if there is an agreement to buy it back if it doesn't sell).

Also retail stores take on more product liability than marketplaces like flea markets do.

What store / grocery store has goods stocked by third parties? (Rather than purchased from the third party by the grocery store)?

All of the ones around here do. Used DVD racks still exist. Soft drink vending machines. Seasonal items. Newspaper racks.

In the case of items actually run through the register, I'm not sure how that's dealt with from an accounting standpoint. I do know that the stores have the ability to return 100% of unsold goods in those cases.

Is it really? I don't see how this comparison works at all. Amazon gives you distribution, traffic, logistics, etc, with zero risk. They just take a fee if you sell. The only upfront cost is if you pay the premium FBA and that's still a like a 40 bucks per month fee.

I'm not trying to defend Amazon, but I don't think that comparison makes sense.

It's obviously not a perfect metaphor, but neither is a grocery store.

>Amazon gives you distribution, traffic, logistics, etc, with zero risk.

Not everyone uses the distribution, and a mall or flea market also provides traffic to tenants.

At a mall you pay a fixed cost in terms of rent, regardless of sales. Amazon doesn’t charge you to simply list your product, right? If vendors were being charged a fee just for the listing itself without any sales, your argument would be more valid.

If amazon does charge a fee for simply listing a product, tell us. They don’t as far as I know.

Some leases do require you to pay a percentage of sells...


No analogy is perfect. Amazon obviously isn't a mall, but it's not a grocery store either.

A grocery store owns the goods in their possession even if they have agreements for sellers to buy some unsold product back. Amazon does not own the 3rd party goods in their possession.

You’re dismissing the mall call by saying no analogy is perfect since it doesn’t work for your argument but then you’re comparing against grocery stores, which is a pretty gross simplification.

Amazon isn’t a grocery store. The majority of their catalog isn’t even available at most grocery stores, maybe excluding WalMart.

My family owned several convenience stores growing up. Some products were bought and it was your problem to move them off shelves. Some were displayed on shelves and you only paid for what was actually sold. This was common with one of the distributors who gave us Frito Lay products. Other products had strict terms - for instance, Pepsi and Coke distributors wouldn’t give you competitive pricing unless you agreed to purchase Y in X quantity, place their mini coolers next to the refrigerator, place signage within x feet, clearly visible from the front entrance, etc. suddenly, you’re the only store in town who sells 16 oz soda for $1.59 just to break even while everyone else is selling the same soda for $1.09 or just 99 cents.

It’s a different model than Amazon and you’re taking liberties to simplify it

> You’re dismissing the mall call by saying no analogy is perfect since it doesn’t work for your argument but then you’re comparing against grocery stores, which is a pretty gross simplification.

No I'm saying it has very important distinctions that make the grocery store analogy inappropriate and that the mall or flea market analogy is closer in some respects, but not all.

>Amazon isn’t a grocery store. The majority of their catalog isn’t even available at most grocery stores, maybe excluding WalMart.

Of course it's not. That's a big part of my original point.

> Some were displayed on shelves and you only paid for what was actually sold.

My dad worked for Lance (and frito lay for a while). I could be wrong and you could have had a very unusual distributor. But my guess is you misunderstood what was happening.

Companies do sometimes offer buyback guarantees and you might even be able to buy items on credit, so that it appears you're only paying for what sells, but that's not actually how it works. Those items are the property of the store while they are on the shelf.

Really curious. How are the other guys selling for $0.99, if they didn’t get the competitive pricing? (Presumably because they didn’t go through the sign within X feet antics)

They did get competitive pricing, but they have a lot more wiggle room because they’re a giant company with far more revenue, marketing, and branding than a couple ma and pa stores. These distributors may or may not have the exact same terms, but at the end of the day, these other corporate stores had enough foot traffic that provided them ammo to help define their own terms. You just didn’t have that leverage as a smaller shop.

Doesn't a grocery store give their product manufacturers those things as well? Distribution, traffic, logistics, marketing.

Perhaps, but with minimal control, larger risks and upfront costs. Especially if you're a small company selling under consignment.

Facile argument. Grocery stores actually rent shelf space in many cases and do not take on product liability. It’s a different business entirely.

Amazon is totally within their right imo, those sellers can go back to eBay if they dislike amazon.

Retail stores absolutely take on more product liability than marketplaces do.

Malls curate the stores that they lease space to. That's why some malls are very high end and others are not.

>Amazon is more like shopping mall that decides to start operating their own stores and competing with their tenants.

more like a big box store that allows other stores to operate in them so long as they get a cut.

On the other hand, it's somewhat unlike a regular marketplace since Amazon requires vendors to match or exceed their own return policy.

>Grocery stores curate their offerings, vet vendors, deal with returns

Amazon does all of these things. They have unlimited shelf space, which reduces constraints.

But vendors can have amazon handle returns, they can be kicked off the platform, and amazon decided how to present vendors.

I don't really see how important that distinction is.

Amazon does that with A-Z guarantee and helping resolve disputes and presenting listings and having Amazon Basics and Amazon’s Choice.

It should be scandalous in those cases too. Having a company be both the distributor and producer and have a monopoly is problematic. This is sort of the problem of cable TV also, where companies like comcast tries to be a producer and distriutor and have a monopoly. In the past we have had unions fight against this sort of thing but unions have been busted to hell in this country over the last few decades to the point where even smart people don't even understand why its bad for a company like amazon to do this, we don't remember why.

Your argument may have held weight in the past, but now, anyone can distribute video without going through the cable providers regular cable distribution. It’s quite simple technically to provide on demand video at scale, including creating apps for all the platforms. The only issue now is when/if cable companies as internet providers start deprioritizing competitors.

Its really not simple, technically. So I don't understand what you're saying.

It really is. You can use manage services through AWS to set this up at almost any scale including encoding, transcoding, global CDNs, etc.

I don't think you understand what simple means for the vast majority of Americans.

The vast majority of Americans aren’t trying to release content that would have been delivered via cable. Except maybe the public access channels.

That content can be uploaded to YouTube.

That's peculiar. Here the market's products are placed in the bottom and top, whilst third party brands reserve all the immediate-view space

> Coincidentally, Amazon brand products are usually pretty good in my experience, so this might not be a terrible outcome for users who have already decided to come shop at Amazon's store.

So it's fine they're shafting other vendors on their platform because their products are good?

Why not? If I search and find a reasonably priced product that fits my needs that is a success. Squeezed vendors is just how the world works, do you think Walmart just sits back and lets its suppliers dictate pricing or promotion?

Sorry, no, that's not the argument I was trying to make. I was trying to show this by starting the sentence with "Coincidentally." It was just a separate observation about the same topic.

I am frustrated by plenty of things that Amazon does, by the way...I just don't think that this is a particularly bad feature of theirs.

shafting other vendors

They own the store. Shopify is a thing.

It is utterly baffling that anyone is surprised by this. Water is wet, fire is hot, Amazon changes their website in ways that make them more money.

Or an OS manufacturer to preinstall their brand of the browser. Oh wait.

It's also understood by all who pass by store isles that the store is giving its own products prominence. Tweaking an algorithm that historically featured products based on users purchasing behavior to instead favor its own products without disclosing it is doing so is misleading.

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