10 ms·

You're over generalizing. There are plenty of sellers that took the time to develop their own products and sell them, only to be copied and undercut by Amazon.

dtjb 3y ago
How is that different from Walmart selling their Great Value store brand? They see what products sell well then formulate their own cheaper alternative, maybe even giving their product better shelf placement. Every national grocer does this. It seems to be a pretty close analog yet nobody bats an eye at the practice.
- WalterBright 3y ago
  The local Kroger supermarket has Kroger branded items on the shelf right next to the national brand. The latter is always more expensive, I usually buy the Kroger brand. The supermarket wouldn't stock the national brands at all if customers weren't buying them.
  - dtjb 3y ago
    Isn't that exactly what Amazon is doing?
    - WalterBright 3y ago
      Yes, that's my point.
  - josefx 3y ago
    I don't know Kroger, but in a lot of cases the store brand is just a label change on the national brand.
- pixl97 3y ago
  In general there are many different grocery stores, even Walmart the massive company it is only represents something like 10% of grocery sales in the US. Amazon represents something like 40% of all online sales. Typically having a large plurality in a market raises the likelihood of actions against you. >It seems to be a pretty close analog yet nobody bats an eye at the practice. Or, more likely, tech people pay attention to Amazon and not the myriad of suits occuring in the retail and grocery world.
  - ctvo 3y ago
    > Or, more likely, tech people pay attention to Amazon and not the myriad of suits occuring in the retail and grocery world. We're listening. Feel free to toss some examples of these myriad of law suits against brick and mortar stores for their in-house brands.
  - sib 3y ago
    Walmart has more than 20% share of grocery in the US...
- turquoisevar 3y ago
  > How is that different from Walmart selling their Great Value store brand? Well for one it’s different in that store brands are often made by the same manufacturing/processing plant as the regular brand. So not only is consent implicitly build in because the producer agreed to make the store brand variety, it’s another income stream. And secondly the store brands typically go out of their way to differentiate themselves from the main brand to such a degree that if you hold the two boxes next to each other you wouldn’t mistake one for the other. Thirdly they significantly undercut the other brands and sellers. They can do so because they don’t have to pay themselves a commission and all the other fees, which in turn forces the other brands and sellers to match or eek out a small price difference in which they’re cheaper in the hopes to get some sales, cutting into the already thin margins that are left after paying Amazon’s fees. Amazon is also in a better position because of the vertical integration, they have a direct relationship with the manufacturer which cuts out the margins of the middle men (the sellers and distributors), regular sellers on Amazon have the distributor’s margins to deal with and then their own margins and as opposed to Amazon they can’t sell their items as a loss leader. As for Walmart and similar retail, it’s a whole different situation. The manufacturer sets the price and within it, their margin. The retailer then purchases it at that price and tacks on their margin, but if it’s on the shelves then the manufacturer has been paid so there’s no risk for the manufacturer because the retailer carries the risk. There are some nuances and exceptions, such as manufacturers sometimes being able to force a MSRP onto the retailer or a retailer being big enough to leverage a better price or a risk shifting agreement where the retailer doesn’t have to pay for delivery until the items are sold, nevertheless, in general the relationship is entirely different from the relationship Amazon has with its sellers. And lastly, Walmart doesn’t hire people to walk beside you in the store to swiftly grab a Great Value variant and push it in your hand each time you so much as think of buying something. The cereal factory that makes Kellogg’s cereal also making Great Value cereal is therefore not comparable to Amazon. Amazon typically makes their Basics items look identical to the most popular brand and place it at the top of search results. Now the original brand is forced to pay to get their item at the top of the list, and even then it’ll get second place, underneath the Amazon branded one (often barely above the fold). Take this example of me searching for a padlock[0][1]. Not only is the Amazon branded lock identical to the one below it, it’s placed prominently at the top of the results in such a way that it’s the only product that can be seen in full. The one immediately below it doesn’t get top spot despite being “sponsored” (i.e. paid to be prominently displayed) and if you look at the price they’re trying to be a little bit cheaper than Amazon in the hopes to generate sales but given how minor the price difference is with the Amazon branded lock, it comes across as a painful thing for them to do because it seems to me as a meaningless difference (but admittedly that’s me reading into things). The issue is that when you’re the platform holder that sets the fees for sellers, controls what people see, have insider knowledge on sales and you use that to benefit your manufacturing and sales division, then you have too much control and are abusing your powers imho. Brick and mortar retailers don’t have this much control over and information on their suppliers. 0: https://pasteboard.co/AZRfDpAtXw4f.jpg https://pasteboard.co/AZRfDpAtXw4f.jpg 1: https://pasteboard.co/VEFULgwx2IgB.png https://pasteboard.co/VEFULgwx2IgB.png
lvl102 3y ago
If you took the time to develop and market your products, you would not have solely relied on Amazon e-commerce. Most likely, the single greatest source of traffic was Facebook (Instagram) and Reddit. You would only sell on Amazon, if you’re from EU (or RoW) and that Amazon US made sense for you in terms of logistics. In other words, if you solely relied on Amazon to make money that means your business model was BUILT on fooling consumers on Amazon algorithm not your actual product.
stale2002 3y ago
That is literally the opposite of anti-competitive. That is the definition of a pro competitive behavior. Lower prices for consumers is the whole point of a competitive market! Yes, big companies can compete in the market, by offer better quality stuff, for a lower price. Thats what we want! You are literally arguing in favor* of monopolies, and against competition by saying that other companies shouldn't do a better job.
- pixl97 3y ago
  Reality is far more complex then the simple take you have here. >by offer better quality stuff, Amazon, for example, offering counterfeits of your product as your product is not under the definition of "better quality stuff" >for a lower price Again, offering a lower price consistently is one thing. Using pricing as a weapon, for example selling a product lower than cost in order to monopolize a market is not.
  - stale2002 3y ago
    > Using pricing as a weapon, for example selling a product lower than cost in order to monopolize a market is not. If the price stays low and never goes to high monopoly prices then it is a good thing. If a company becomes a "monopoly" by being cheap, and staying cheap, thats just competition by definition. Which is the situation we are seeing with amazon.
    - lp0_on_fire 3y ago
      Selling things at a loss doesn’t mean things are cheap it just means the real costs are being subsidized elsewhere.
    - ameister14 3y ago
      >If the price stays low and never goes to high monopoly prices then it is a good thing. Not necessarily, but it goes a long way to balancing out the negative consequences. The problem, though, is they've never had prices stay low. Eventually, prices go up. So far, Amazon does this through loss-leaders; products that have low prices allowing them to capture a market and charge high prices for other products as a monopoly. >If a company becomes a "monopoly" by being cheap, and staying cheap, thats just competition by definition. If that was all they were doing it would be legal.

dtjb 3y ago

How is that different from Walmart selling their Great Value store brand? They see what products sell well then formulate their own cheaper alternative, maybe even giving their product better shelf placement. Every national grocer does this. It seems to be a pretty close analog yet nobody bats an eye at the practice.

WalterBright 3y ago
The local Kroger supermarket has Kroger branded items on the shelf right next to the national brand. The latter is always more expensive, I usually buy the Kroger brand. The supermarket wouldn't stock the national brands at all if customers weren't buying them.
- dtjb 3y ago
  Isn't that exactly what Amazon is doing?
  - WalterBright 3y ago
    Yes, that's my point.
- josefx 3y ago
  I don't know Kroger, but in a lot of cases the store brand is just a label change on the national brand.
pixl97 3y ago
In general there are many different grocery stores, even Walmart the massive company it is only represents something like 10% of grocery sales in the US. Amazon represents something like 40% of all online sales. Typically having a large plurality in a market raises the likelihood of actions against you. >It seems to be a pretty close analog yet nobody bats an eye at the practice. Or, more likely, tech people pay attention to Amazon and not the myriad of suits occuring in the retail and grocery world.
- ctvo 3y ago
  > Or, more likely, tech people pay attention to Amazon and not the myriad of suits occuring in the retail and grocery world. We're listening. Feel free to toss some examples of these myriad of law suits against brick and mortar stores for their in-house brands.
- sib 3y ago
  Walmart has more than 20% share of grocery in the US...
turquoisevar 3y ago
> How is that different from Walmart selling their Great Value store brand? Well for one it’s different in that store brands are often made by the same manufacturing/processing plant as the regular brand. So not only is consent implicitly build in because the producer agreed to make the store brand variety, it’s another income stream. And secondly the store brands typically go out of their way to differentiate themselves from the main brand to such a degree that if you hold the two boxes next to each other you wouldn’t mistake one for the other. Thirdly they significantly undercut the other brands and sellers. They can do so because they don’t have to pay themselves a commission and all the other fees, which in turn forces the other brands and sellers to match or eek out a small price difference in which they’re cheaper in the hopes to get some sales, cutting into the already thin margins that are left after paying Amazon’s fees. Amazon is also in a better position because of the vertical integration, they have a direct relationship with the manufacturer which cuts out the margins of the middle men (the sellers and distributors), regular sellers on Amazon have the distributor’s margins to deal with and then their own margins and as opposed to Amazon they can’t sell their items as a loss leader. As for Walmart and similar retail, it’s a whole different situation. The manufacturer sets the price and within it, their margin. The retailer then purchases it at that price and tacks on their margin, but if it’s on the shelves then the manufacturer has been paid so there’s no risk for the manufacturer because the retailer carries the risk. There are some nuances and exceptions, such as manufacturers sometimes being able to force a MSRP onto the retailer or a retailer being big enough to leverage a better price or a risk shifting agreement where the retailer doesn’t have to pay for delivery until the items are sold, nevertheless, in general the relationship is entirely different from the relationship Amazon has with its sellers. And lastly, Walmart doesn’t hire people to walk beside you in the store to swiftly grab a Great Value variant and push it in your hand each time you so much as think of buying something. The cereal factory that makes Kellogg’s cereal also making Great Value cereal is therefore not comparable to Amazon. Amazon typically makes their Basics items look identical to the most popular brand and place it at the top of search results. Now the original brand is forced to pay to get their item at the top of the list, and even then it’ll get second place, underneath the Amazon branded one (often barely above the fold). Take this example of me searching for a padlock[0][1]. Not only is the Amazon branded lock identical to the one below it, it’s placed prominently at the top of the results in such a way that it’s the only product that can be seen in full. The one immediately below it doesn’t get top spot despite being “sponsored” (i.e. paid to be prominently displayed) and if you look at the price they’re trying to be a little bit cheaper than Amazon in the hopes to generate sales but given how minor the price difference is with the Amazon branded lock, it comes across as a painful thing for them to do because it seems to me as a meaningless difference (but admittedly that’s me reading into things). The issue is that when you’re the platform holder that sets the fees for sellers, controls what people see, have insider knowledge on sales and you use that to benefit your manufacturing and sales division, then you have too much control and are abusing your powers imho. Brick and mortar retailers don’t have this much control over and information on their suppliers. 0: https://pasteboard.co/AZRfDpAtXw4f.jpg https://pasteboard.co/AZRfDpAtXw4f.jpg 1: https://pasteboard.co/VEFULgwx2IgB.png https://pasteboard.co/VEFULgwx2IgB.png

lvl102 3y ago

If you took the time to develop and market your products, you would not have solely relied on Amazon e-commerce. Most likely, the single greatest source of traffic was Facebook (Instagram) and Reddit. You would only sell on Amazon, if you’re from EU (or RoW) and that Amazon US made sense for you in terms of logistics. In other words, if you solely relied on Amazon to make money that means your business model was BUILT on fooling consumers on Amazon algorithm not your actual product.

stale2002 3y ago

That is literally the opposite of anti-competitive. That is the definition of a pro competitive behavior. Lower prices for consumers is the whole point of a competitive market! Yes, big companies can compete in the market, by offer better quality stuff, for a lower price. Thats what we want! You are literally arguing in favor* of monopolies, and against competition by saying that other companies shouldn't do a better job.

pixl97 3y ago
Reality is far more complex then the simple take you have here. >by offer better quality stuff, Amazon, for example, offering counterfeits of your product as your product is not under the definition of "better quality stuff" >for a lower price Again, offering a lower price consistently is one thing. Using pricing as a weapon, for example selling a product lower than cost in order to monopolize a market is not.
- stale2002 3y ago
  > Using pricing as a weapon, for example selling a product lower than cost in order to monopolize a market is not. If the price stays low and never goes to high monopoly prices then it is a good thing. If a company becomes a "monopoly" by being cheap, and staying cheap, thats just competition by definition. Which is the situation we are seeing with amazon.
  - lp0_on_fire 3y ago
    Selling things at a loss doesn’t mean things are cheap it just means the real costs are being subsidized elsewhere.
  - ameister14 3y ago
    >If the price stays low and never goes to high monopoly prices then it is a good thing. Not necessarily, but it goes a long way to balancing out the negative consequences. The problem, though, is they've never had prices stay low. Eventually, prices go up. So far, Amazon does this through loss-leaders; products that have low prices allowing them to capture a market and charge high prices for other products as a monopoly. >If a company becomes a "monopoly" by being cheap, and staying cheap, thats just competition by definition. If that was all they were doing it would be legal.