5 ms·

In other words Amazon is no different than the existing credit card companies (Visa, MC, AmEx, ect...), the existing merchant services, and the retailers themse

In other words Amazon is no different than the existing credit card companies (Visa, MC, AmEx, ect...), the existing merchant services, and the retailers themselves who all collect that data for purposes of selling to third parties and use for in house marketing. Brick and Mortar retailers are concerned about being able to conveniently accept payment and minimizing service charges for the convenience of accepting non-cash payment. Ideally retailers wouldn't have to accept cards, they would only accept cash, cash = no service charge by a third party. However, that is the whole point of the financial industry to create an economy that permits middle men to take a percent of every transaction (as you say "grow thanks to your hard work"). Why have a store and sell anything when you can have someone else do the work and get a % of every transaction? But Amazon is not the first to do it.

gfodor 12y ago
Obviously Amazon is different, because unlike credit card companies they are in the business of competing with small retailers. Particularly when you consider their "your margin is my opportunity" strategy giving this data to them should be a terrifying proposition for any business owner.
- jack-r-abbit 12y ago
  But there are so many places that Amazon does not compete with that there is a market for this. Obviously a small book store might not want to do this but what about restaurants, coffee shops, the plumber that comes to fix your toilet (or any service industry), the local tap room, and so on. Edit: Sorry, the idea of Amazon opening restaurants, coffee shops or tap rooms (which would also mean they start brewing their own beer) reminds me of this scene from Judge Dredd: https://www.youtube.com/watch?v=xFiDoOgRTpk https://www.youtube.com/watch?v=xFiDoOgRTpk (Now All Restaurants are Taco Bell)
  - nicholassmith 12y ago
    Amazon might not be competing with them right now, but they could be in 5 years time (as ridiculous as that sounds for your examples), and businesses should take the long term view. When it was just books most businesses ignored Amazon, but they've grown to encompass many, many industries now.
    - weaksauce 12y ago
      You know how ridiculous it would have sounded if I told you 15 years ago that you could specify any address and get a local 360° street view of it... Even in rural austrailia or inside a business. And that comes from a search engine company... That mainly makes money off advertising. Who knows where amazon will go.
      - silverbax88 12y ago
        I don't know but Wal-Mart and Home Depot have tried muscling in on small shops multiple times and failed..meaning, opening mom-and-pop size stores. That doesn't mean Amazon will fail, just mentioning that very few people are aware that this is something the retail giants have been trying to do for some time. The thing about Amazon is that every company who should be their competitor (Barnes & Noble, Borders, Wal-Mart) constantly botches it. They have the money to fend off Amazon. I guess that's what happens when bloated, dumb corporations get real, nimble competition. It would be like if Amazon decided to take on Comcast selling cable TV. Comcast is huge, wealthy and established, but, and I don't think I would like this, but my money would be on Amazon because Comcast is rich but dumb.
        weaksauce 12y ago
        Comcast is dumb, wealthy, established and has a huge reputation for being actively hostile to customers because of geographical monopolies.(possible that they do it because they are dumb but I put my money on the monopoly) amazon competing would be a win for consumers most likely since they are pretty actively customer focused. It would likely be a loss to the people selling through them though. I like amazon as a consumer for the most part but apparently their tactics and policies toward retailers is less than shining.
        medell 12y ago
        Having reviews next to your shop would only be worse for your shop if you aren't a good shop to begin with. I think this is better for the consumer in the end (which is a motto Amazon also preaches), unless they turn evil and use their advantage to squeeze consumers, which isn't all that unlikely since they are a public compnay. But so far they've done a great job of lowering prices for many commodity goods, which most goods are becoming.
  - rgovind 12y ago
    Five yrs ago we wouldn't have guessed Amazon would do tablets, its on OS, music service etc. We don't know what they will do five years from now.
  - gfodor 12y ago
    Yeah I don't disagree with you here, just pointing out that a small business owner who does compete with Amazon should maybe think twice before being attracted to the competitive rate compared to Square.
  - B5geek 12y ago
    Demolition Man not Judge Dredd. --Enhance your calm John Spartan.
    - jack-r-abbit 12y ago
      Damn... how did I mess that up? My bad.
      - sslayer 12y ago
        Don't sweat it, obviously you're still traumatized by the three seashells.
      - silverbax88 12y ago
        Well, if it makes you feel better, Wesley Snipes did an AMA on Reddit a few days ago, and someone asked him if there would be a Demolition Man sequel. He responded politely, but basically said "people need to be allowed to forget that movie". So you are good.
  - nedwin 12y ago
    Well Amazon have started doing a local services marketplace. If they can become dominant they can start to control the flow of leads to these businesses and therefore control margins and pricing.
- will_brown 12y ago
  It is actually a very interesting point you raise from a legal perspective. Kind of on par with Google's ability to unfairly utilize their internet search data which would have crushed the competition is spaces such as hotel/airline booking, local review websites, ect... For example, Google is under significant regulations as a result of the DOJ settlement[1], "To prevent abuse of commercially sensitive information, Google will be required to implement firewall restrictions within the company that prevent unauthorized use of competitively sensitive information and data gathered from [flight booking] customers." While I think jack-r-abbit is accurate about many business not competing with Amazon, if Amazon begins using financial data to unfairly stifle retailer competition, then they are playing with fire, Anti-Trust lawsuits are not cheap. [1] http://www.justice.gov/opa/pr/2011/April/11-at-445.html http://www.justice.gov/opa/pr/2011/April/11-at-445.html
- bugsense 12y ago
  They will learn your habits and then they will promote their store instead of the physical one where you do the first purchase. Pure evil!
laurencerowe 12y ago
Cash handling is not free either. In many European markets paying by debit card is cheaper than cash for the shop, at least for the larger chains. That's why they offer cash back at the till.
gnopgnip 12y ago
There are non negligible costs for accepting cash. Major retailers have to have armored trucks to move cash, cash counts require more trained personnel. Even on a smaller level there is increased risk of theft or skimming from taking cash compared to credit only.
calbear81 12y ago
The whole point of credit is to extend purchasing power that you don't have on hand (cash). Merchants would lose money because people wouldn't be able to use a credit line and instead delay purchasing. Credit also allows for financing large purchases over time and the assumption of default risk.

gfodor 12y ago

Obviously Amazon is different, because unlike credit card companies they are in the business of competing with small retailers. Particularly when you consider their "your margin is my opportunity" strategy giving this data to them should be a terrifying proposition for any business owner.

jack-r-abbit 12y ago
But there are so many places that Amazon does not compete with that there is a market for this. Obviously a small book store might not want to do this but what about restaurants, coffee shops, the plumber that comes to fix your toilet (or any service industry), the local tap room, and so on. Edit: Sorry, the idea of Amazon opening restaurants, coffee shops or tap rooms (which would also mean they start brewing their own beer) reminds me of this scene from Judge Dredd: https://www.youtube.com/watch?v=xFiDoOgRTpk https://www.youtube.com/watch?v=xFiDoOgRTpk (Now All Restaurants are Taco Bell)
- nicholassmith 12y ago
  Amazon might not be competing with them right now, but they could be in 5 years time (as ridiculous as that sounds for your examples), and businesses should take the long term view. When it was just books most businesses ignored Amazon, but they've grown to encompass many, many industries now.
  - weaksauce 12y ago
    You know how ridiculous it would have sounded if I told you 15 years ago that you could specify any address and get a local 360° street view of it... Even in rural austrailia or inside a business. And that comes from a search engine company... That mainly makes money off advertising. Who knows where amazon will go.
    - silverbax88 12y ago
      I don't know but Wal-Mart and Home Depot have tried muscling in on small shops multiple times and failed..meaning, opening mom-and-pop size stores. That doesn't mean Amazon will fail, just mentioning that very few people are aware that this is something the retail giants have been trying to do for some time. The thing about Amazon is that every company who should be their competitor (Barnes & Noble, Borders, Wal-Mart) constantly botches it. They have the money to fend off Amazon. I guess that's what happens when bloated, dumb corporations get real, nimble competition. It would be like if Amazon decided to take on Comcast selling cable TV. Comcast is huge, wealthy and established, but, and I don't think I would like this, but my money would be on Amazon because Comcast is rich but dumb.
      - weaksauce 12y ago
        Comcast is dumb, wealthy, established and has a huge reputation for being actively hostile to customers because of geographical monopolies.(possible that they do it because they are dumb but I put my money on the monopoly) amazon competing would be a win for consumers most likely since they are pretty actively customer focused. It would likely be a loss to the people selling through them though. I like amazon as a consumer for the most part but apparently their tactics and policies toward retailers is less than shining.
        medell 12y ago
        Having reviews next to your shop would only be worse for your shop if you aren't a good shop to begin with. I think this is better for the consumer in the end (which is a motto Amazon also preaches), unless they turn evil and use their advantage to squeeze consumers, which isn't all that unlikely since they are a public compnay. But so far they've done a great job of lowering prices for many commodity goods, which most goods are becoming.
- rgovind 12y ago
  Five yrs ago we wouldn't have guessed Amazon would do tablets, its on OS, music service etc. We don't know what they will do five years from now.
- gfodor 12y ago
  Yeah I don't disagree with you here, just pointing out that a small business owner who does compete with Amazon should maybe think twice before being attracted to the competitive rate compared to Square.
- B5geek 12y ago
  Demolition Man not Judge Dredd. --Enhance your calm John Spartan.
  - jack-r-abbit 12y ago
    Damn... how did I mess that up? My bad.
    - sslayer 12y ago
      Don't sweat it, obviously you're still traumatized by the three seashells.
    - silverbax88 12y ago
      Well, if it makes you feel better, Wesley Snipes did an AMA on Reddit a few days ago, and someone asked him if there would be a Demolition Man sequel. He responded politely, but basically said "people need to be allowed to forget that movie". So you are good.
- nedwin 12y ago
  Well Amazon have started doing a local services marketplace. If they can become dominant they can start to control the flow of leads to these businesses and therefore control margins and pricing.
will_brown 12y ago
It is actually a very interesting point you raise from a legal perspective. Kind of on par with Google's ability to unfairly utilize their internet search data which would have crushed the competition is spaces such as hotel/airline booking, local review websites, ect... For example, Google is under significant regulations as a result of the DOJ settlement[1], "To prevent abuse of commercially sensitive information, Google will be required to implement firewall restrictions within the company that prevent unauthorized use of competitively sensitive information and data gathered from [flight booking] customers." While I think jack-r-abbit is accurate about many business not competing with Amazon, if Amazon begins using financial data to unfairly stifle retailer competition, then they are playing with fire, Anti-Trust lawsuits are not cheap. [1] http://www.justice.gov/opa/pr/2011/April/11-at-445.html http://www.justice.gov/opa/pr/2011/April/11-at-445.html
bugsense 12y ago
They will learn your habits and then they will promote their store instead of the physical one where you do the first purchase. Pure evil!

laurencerowe 12y ago

Cash handling is not free either. In many European markets paying by debit card is cheaper than cash for the shop, at least for the larger chains. That's why they offer cash back at the till.

gnopgnip 12y ago

There are non negligible costs for accepting cash. Major retailers have to have armored trucks to move cash, cash counts require more trained personnel. Even on a smaller level there is increased risk of theft or skimming from taking cash compared to credit only.

calbear81 12y ago

The whole point of credit is to extend purchasing power that you don't have on hand (cash). Merchants would lose money because people wouldn't be able to use a credit line and instead delay purchasing. Credit also allows for financing large purchases over time and the assumption of default risk.