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An interesting phenomena I'm starting to see involved in this is when the trash retailing experience on Amazon affects entire product ecosystems. As long as the
by yourapostasy 7y ago
An interesting phenomena I'm starting to see involved in this is when the trash retailing experience on Amazon affects entire product ecosystems. As long as the trash dominates listings, better manufacturers and vendors seem to begin to find it difficult to keep the trash out of their own supply chains.
A personal example is search in Amazon on "lightning splitter", for the Lightning adapters that split a single Lightning port into one for charging and one for audio.
This entire category is awash in pretty much all the sketch activity we talk about here on HN. It's easy to find an example where questions were asked about completely different products, and the vendor subsequently swapped the product in the listing for the Lightning splitter. Also easy to find reviews in broken English posted within 1-2 days of each other. The litany goes on.
That's not the interesting part. What I find interesting is Belkin, whose business model seems to tend to be source from about the same as these vendors in China, slap on a bunch of marketing with some so-so-but-not-spectacular QA and support, and marks up the result 5-800%, is themselves caught up in this. Their own offering in this category is complete trash just like all the other listings, based upon reviews and first-hand experience, with exactly the same failure mode (works for 1-6 months, then power and/or audio connection breaks down).
Power banks seemed to go through the same sketchy phase, which I finally gave up upon and just started only buying Anker brand. Even though they weren't the absolute best, they were good enough, and I knew I wouldn't get utter trash out of the box.
I have long suspected this entire state of affairs suits Amazon just fine. The more product categories that trash themselves like this, the more of an opening it gives Amazon to completely vertically integrate the entire supply chain for that category under their Basics label, and shove aside most/all of the trash vendors to the loud acclaim of consumers, who get so sick of the trash experience that they welcome the creeping Amazon monopolization with open arms and lusty cheers. I wouldn't at all be surprised if Amazon rolls out tiered-quality offerings beyond Basics as this effort takes hold.
One possible way that might frustrate Amazon's efforts in this direction is more companies like Anker spot these opportunities (with a basic business model being "don't be completely toxic to your customers, build a reasonable product with reasonable support at a reasonable price point") and fill the empty niches, then exert absolutely tyrannical channel control. The manufacturer claims the only authorized Amazon (or even a whole set of online platforms) authorized channel sales to avoid commingling counterfeits, and comes down like a ton of bricks on anyone that tries to mom-and-pop resell online on staked-out e-commerce platforms.
This is a live economics and marketing exercise in the power and utility of branding. Could be some interesting needs and solutions for supply chain verification coming out of this as well, with subtle, secret but cheaply-implemented, manufacturer-designed watermarks built into the products to catch authorized resellers trying to sneak in cheap counterfeits amongst their legit stock to illicitly boost their margins.
- ikeboy 7y agoNote that Belkin is owned by Foxconn. Otherwise, I agree with the dynamics you describe. There's two kinds of brands, the ones that make cheap crap that kinda works and the expensive decent quality ones. On some level, you get what you pay for. Re counterfeits, Amazon's Transparency program effectively solves it cheaply if you're willing to QR label all your products.
- yourapostasy 7y agoThank you for letting me know about the Foxconn connection! That adds an extra interesting twist. Presumably Belkin is Foxconn's attempt via the Belkin/Linksys/Wemo acquisitions to climb up the value ladder and establish its own vertically-integrated manufacturer-to-retail value chain. The question then turns to how much does Belkin outsource on the particular product I gave as an example, versus using Foxconn's native design, manufacturing, and QA capabilities. What piques my interest is how even Belkin with Foxconn's considerable expertise on tap, apparently cannot set itself apart from whoever (or multiple whoever's) is supplying everyone the trash design and manufacturing of this particular product segment (after trying three different suppliers at three different price points, I've given up altogether and will check again in about 8 months). I'd love to hear Bunnie Huang's insights on this.