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> Jeff Bezos, this one’s for you. This provision aims at Amazon’s practice of using data it collects from third-party merchants to enhance its own private label
by fhrow4484 5y ago
> Jeff Bezos, this one’s for you. This provision aims at Amazon’s practice of using data it collects from third-party merchants to enhance its own private label offerings. If it passes, the practice would be blatantly illegal.
Would it equally apply to physical stores like Safeway, Kroger, Costco's private labels like "Private Selection", "Simple Truth", "Kirkland", ...
What makes Amazon different in this regard? Is Amazon doing it differently? (Like go out on their own instead of partnering with the product company to produce "Amazon" branded version of theirs)
- mattnewton 5y agoReminds me of the Florida laws that explicitly carve out exceptions for businesses that run theme parks (cough cough Disney) https://www.businessinsider.com/florida-censorship-law-loophole-for-theme-park-operators-2021-5 https://www.businessinsider.com/florida-censorship-law-looph...
- mod 5y agoIn Arkansas, specific laws were in place to disallow gambling at any establishment besides Oaklawn (a horse racing track), and Southland (dog track). A couple of years ago they allowed for four casino licenses in the state, so there's a couple more options.
- nostrademons 5y agoIt makes me wonder why Google or Facebook hasn't bought Great America yet.
- mattnewton 5y agoIt’s a recent law, there is still time for Faceland or Google America.
- neuro 5y agoI just saw you and nickb’s posts from 2007 searching for something, good to see you again old timer. You still got your hair?
- nostrademons 5y agoYes, but it's a lot whiter now. :-)
- jbverschoor 5y agoNot for bezos anymore
- rootusrootus 5y ago> What makes Amazon different in this regard? Safeway/Kroger/Costco do not have direct third-party merchants, do they? They are just resellers. This is fundamentally different from what Amazon is doing.
- xyzzyz 5y agoThey all have their own store brands.
- rootusrootus 5y agoSure, but if they are the actual customers of their suppliers, it doesn't seem like what Amazon does. I don't walk into Kroger and buy Doritos from Frito-Lay with Kroger just doing the fulfillment and payment processing, do I? I'm actually buying product that Kroger owns. At least this is how I understand it. I am 100% open to being schooled in how it actually plays out. I'm just a software guy, but I like to learn.
- jsolson 5y agoIf you're curious, The Secret Life of Groceries is a good (and interesting) read. One tl; dr thing is that the supermarkets are a _supplier_ to both end customers and those with products to sell. They supply shelf space and customer reach, in the very literal sense that companies bid for things like endcap placement (the end of the aisle being better than being in the aisle, since everyone making an orbit through, say, the deli section will pass your goods).
- rootusrootus 5y agoThanks! That is an interesting aspect. I had not considered that it could be a two-way relationship, rather than the store just buying what they want to sell and putting it on the shelf. I guess it seems a little obvious in retrospect that there must be a bit of that going on, I've long noticed that some suppliers have a lot of responsibility in the store beyond delivering product. Like the beer guy pretty much runs the entire beer aisle. And it's one of the big names supplying all the beer, not just their own. I've seen similar action in some stores by the soft drink vendors and even the bread vendor. Non-store employees on the floor putting stock directly on the shelf.
- felipellrocha 5y agoI mean, those are still awful. This would be a two birds with one stone kind of situation.
- Cerium 5y agoTrader Joe's is the closest to Amazon in this regard. They introduce new products as the name brand, the best sellers are cloned and then replaced with the store brands.
- dec0dedab0de 5y agoAldi is similar, which is kind of interesting because Trader Joes is one of the Aldis. I always wonder how they get away with blatant trademark infringement. They come up with similar product design for the purpose of confusing consumers. I assume they have deals with most of the name brand products, or their parent companies.
- arrosenberg 5y agoI don't know about Trader Joe's specifically, but a lot of "Store Brands" are made in the same place as the name brand. It's just a giant game of price discrimination.
- rurp 5y agoThis is very true. I worked at Traders many years ago and at least back then the store brands were often made by the same name brand company.
- Stratoscope 5y agoAgreed. I never worked there but have shopped there for many years, along with the other usual places like Whole Foods and Safeway. A game I used to play was "spot the TJ's store brand item under its own name at another store." One example is TJ's French Village plain nonfat yogurt, which is very obviously Nancy's yogurt from Springfield Creamery in Oregon. Same exact taste and texture in the same packaging. (Nancy's used to come in clear plastic tubs like TJ's. A few years ago they switched to opaque white for their name brand, but it's still the same product.) Another is some of the frozen Indian foods, which Whole Foods carries under the manufacturer's brand name.
- 5y ago
- schnable 5y agoThey don't operate a marketplace for third party merchants.
- lotsofpulp 5y agoWalmart and Target do.
- Aissen 5y agoThe only difference is this: > ‘covered platforms’ (companies that have a half-million monthly U.S. users and more than $600 billion in market cap) There are only 8 companies in the world that match the market cap. Probably 6 if you add "users": Apple, Microsoft, Amazon, Google, Facebook, and probably Tencent.
- bogota 5y agoSounds like this would be easily defeated by spinning amazon out into different companies? Maybe that is a good end result though.
- ethbr0 5y agoI haven't looked at any formal studies of the net effects of the Bell breakup, but I'd be hard-pressed to say they were net negative. Especially with a relatively light "break-up, then allow to recombine as market evolution renders their previous monopoly moot" long-term approach.
- ben_w 5y agoEspecially as Amazon is already many companies, in many different jurisdictions, and covering different product and service categories: https://opencorporates.com/corporate_groupings/Amazon https://opencorporates.com/corporate_groupings/Amazon
- tedunangst 5y agoSpinning off AWS, which is pretty independent, might be enough.
- ab_testing 5y ago600B seems like a totally arbitrary made up number to target Amazon but leave out Walmart (which is close to 400B). Looks like Walmart lobbying dollars are bearing fruit.
- deleted 5y ago[deleted]
- pontus 5y agoI've had the same thought about Google promoting its own products over competitor's in search results. Isn't that the same as Whole Foods putting a stack of their 365 brand cereals at the front of the store?
- paulpauper 5y agoi don't see what the big deal is about google promoting its own products on the results page. All that means is one less slot for wikipedia/pinterest/amazon/ebay/nytimes or some other big site.
- Jaygles 5y agoAnother difference between Amazon and physical stores is that Amazon has pagination. If a product ends up on the second or third page, it will likely not be seen by the vast majority of customers. With physical stores, your options are always all right in front of you.
- nerfhammer 5y agofor physical stores sellers fight over having products placed on eye-level shelves vs. not
- 8note 5y agoOr at the front of the store, vs a back corner
- root_axis 5y agoStores are constrained by the limits of physical space, it's exactly the same thing as an Amazon "first page" except at least with Amazon you have the option to visit the second page. In a physical store anything that would have been relegated to the second page is simply unavailable.
- officialjunk 5y agothere is an analogous experience at physical stores, though. the proximity of items to entryways, cashiers, etc matters for sales. also, which height shelf a product is put on also matters. some at eye level, for example, and others at children's eye level, make certain products more prominent. if you are trying to place a product at a store, how much it would cost you depends greatly on where in the store it is placed.
- Jaygles 5y agoSure, but I would argue that that is more of an analogy to the first page of products only. Things that are beyond the third or fourth page may as well be in the back of the store, and not on the shelves.
- zer00eyz 5y agoYour point is valid and correct. Most of you remember Twinkies, its parent company going bankrupt and them being gone... Those products were delivered to stores, fresh every day(ish) by manufacturer employees and put ON THE SHELF by them... This still remains true for tons of products. For some products grocery stores function like a merchant on amazon. Data tracking... well that really matters to a grocery store, because people have "brand loyalty" and tend not to return (ever again) if their "item" is out of stock. These anchor items are often loss leaders (detergent is the massive example). Amazon isn't any different than anyone else, and isn't even the biggest one (Walmart still has that crown). Oddly I could make an argument that amazon, being allowed to be dominant and pushing large retail out of business would be good for everyone... a return of small retailers might happen on the back of that.
- frumper 5y agoAmazon claims it doesn't have liability if those Twinkie's cause harm like the grocery store would.
- zer00eyz 5y agoThe sale of contaminated beef has happened many many times in my lifetime, leading to massive recalls, even lettuce has seen contamination and outbreaks. The liability has not been on the store, rather the supplier/manufacturer of those products. The local ford dealer wast at fault for your pinto exploding of the tires blowing off your SUV. You didn't get to sue the store that sold you cigarets or round up that gave you cancer...
- dannyr 5y agoIt's the scale! A lot of things that Big Tech is doing is usually fine if you're a company with a small market share.
- tedunangst 5y agoGood thing there's an exception for mom and pop stores like Walmart.
- billjings 5y ago"What makes Amazon different in this regard? Is Amazon doing it differently?" Nothing, and they aren't. Except they're maybe the biggest. The intellectual foundation of this new movement isn't specifically anti big tech. It's anti all kinds of anticompetitive business practices, many of which have had huge negative effects outside of tech. Grocery stores are one of them, but one can point to any area of the economy and find businesses engaging in what is currently standard practice that the new movement is seeking to outlaw, or in many cases just restore the teeth to laws that have been ignored for years, or just so narrowly interpreted that they're meaningless.
- dantheman 5y agoThese aren't anti-competitive, they increase competition. The help the consumer get better prices.
- timmytokyo 5y agoUntil they push the competition out, and then there is no more downward pressure on prices.
- raverbashing 5y agoUntil they become the monopoly and are free to hike prices
- dantheman 5y agoUnless the monopoly is granted/enforced by the government this has literally never happened.
- Supermancho 5y ago>> Until they become the monopoly and are free to hike prices > Unless the monopoly is granted/enforced by the government this has literally never happened. It happens often enough. So often, you can find stories about it all over...if you looked. https://www.nytimes.com/2021/05/25/business/amazon-dc-lawsuit.html https://www.nytimes.com/2021/05/25/business/amazon-dc-lawsui... https://www.theverge.com/2020/9/11/21431962/public-citizen-amazon-price-gouging-coronavirus-covid-19-hand-sanitizer-masks-soap-toilet-paper https://www.theverge.com/2020/9/11/21431962/public-citizen-a... https://www.wsj.com/articles/googles-secret-project-bernanke-revealed-in-texas-antitrust-case-11618097760 https://www.wsj.com/articles/googles-secret-project-bernanke... etc. It's a matter of them getting caught and when, because nothing lasts forever, even for the tech robber barons.
- Paedor 5y agoThere's a great episode by planet money on the difference between Amazon and physical stores, the transcript is here: https://www.npr.org/transcripts/697060225 https://www.npr.org/transcripts/697060225. They mention two key differences. The first is just that Amazon is arguably more dominant than any physical distributor, and has more power over offerings. The second is that if you make a new product for a retailer, the retailer usually has to invest in you to some extent, by giving you physical space and buying your product for resale. So, there's some shared risk and for developing new products. Amazon, on the other hand, doesn't need to give you anything to see how a new product will play out, so it might have too much of a position of power.
- Hongwei 5y agoI buy the first, not the second. Retailers often charge consumer packaged goods companies (CPGs) for preferential placement in aisle and carry no risk on inventory. The bigger the retailer (eg. bestbuy, walmart), the more likely they can assume no risk on inventory with a full return policy to the CPG. Best Buy just rents out space on their store floor to individual brands.
- deleted 5y ago[deleted]
- crazygringo 5y agoIt's the monopoly aspect. Amazon is a quasi-monopoly for sellers in the sense that many sellers can only be profitable selling on Amazon, they have no choice. If Amazon has data on their entire customer base, clones their product and puts them out of business, you can view that as monopoly abuse of power. On the other hand, Ruffles sells their potato chips to hundreds if not thousands of national grocery store chains. If some stores sell their own potato chips as well, those are just blips. Stores don't have insight into Ruffles' sales nationwide across all chains.
- graeme 5y agoThere are basically three large grocery chains in the US, plus Target and Walmart. The e commerce market isn’t so different. Amazon has a 40% share. Walmart is a big player, then Shopify et al enable lots of DTC companies. Amazon is only a monopoly if you redefine the relevant market to be “Amazon” https://en.m.wikipedia.org/wiki/List_of_supermarket_chains_in_the_United_States https://en.m.wikipedia.org/wiki/List_of_supermarket_chains_i...
- bingidingi 5y agoI believe Amazon is more like 50%+ now, and to compared to brick & mortar... Wal-Mart is considered huge and still only ~10% of the market. There are more than 3 grocery chains in your link, I think you may have overlooked the regional chains listed below.
- graeme 5y agoNope, 40.4%: https://www.emarketer.com/content/amazon-dominates-us-ecommerce-though-its-market-share-varies-by-category https://www.emarketer.com/content/amazon-dominates-us-ecomme...
- bingidingi 5y agomaybe I was looking at bad data? this says 51.2% of retail ecommerce https://www.pymnts.com/news/retail/2021/amazon-walmart-nearly-tied-in-full-year-share-of-retail-sales/ https://www.pymnts.com/news/retail/2021/amazon-walmart-nearl...
- 2OEH8eoCRo0 5y agoThis tired take is in every single thread.
- jjcm 5y agoSafeway, Kroger, and Costco's market caps are all under the 600b limit. Even Walmart is under this. What makes Amazon different is Amazon controls 38% of all online retail sales in the United States[1]. No company comes close to their dominance in the market. [1] https://www.bloomberg.com/news/articles/2019-06-13/emarketer-cuts-estimate-of-amazon-s-u-s-online-market-share https://www.bloomberg.com/news/articles/2019-06-13/emarketer...
- missedthecue 5y agoAnd because they trade at a frothy multiple.
- 8note 5y agoHow much big box retail sales does Walmart control?