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Lawmaker Sticks Up for Amazon Sellers

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Amazon logoA lawmaker is sticking up for Amazon sellers. Senator Warren told the New York Times that Amazon should be scrutinized for potential anti-competitive behavior.

The problem, as she sees it, is that Amazon amasses  sales data from third-party sellers and use it to its own advantage as a retailer – for example, develop a private-label brand, according to Business Insider’s coverage of the interview. “If you’re getting a huge competitive advantage from being a platform provider because of all this information you keep scraping off, then we no longer have competition going on.”

Julia Wilkinson wrote about the issue on the AuctionBytes Blog after the Wall Street Journal published a piece in 2012. The Journal reported that some small Amazon marketplace sellers felt Amazon used its marketplace “as a vast laboratory to spot new products to sell, test sales of potential new goods, and exert more control over pricing.”

In 2016, readers reacted to a Bloomberg article when it reported:

“Amazon is using insights gleaned from its vast Web store to build a private-label juggernaut that now includes more than 3,000 products – from women’s blouses and men’s khakis to fire pits and camera tripods. The strategy is a digital twist on one used for years by department stores and big-box chains to edge out middlemen and go direct to consumers – boosting loyalty and profits.”

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Last year we blogged about a study conducted by SLI Systems that found sellers recognized the competitive threat Amazon posed. One EcommerceBytes reader pointed out that Amazon is very data driven, and said they believed Amazon is open to losing money in the short term in order to make money down the road.

The conversation in the comments turned to “gating,” a practice in which Amazon restricts sellers from listing items in certain categories. A reader said that while Amazon will often come in and upset your apple cart with specific products, “overall they are fair and give notice; hard but fair.”

It’s always interesting to see lawmakers and politicians weigh in on issues involving online sellers. These days, Amazon is facing a lot of heat.

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Ina Steiner
Ina Steiner
Ina Steiner is co-founder and Editor of EcommerceBytes and has been reporting on ecommerce since 1999. She's a widely cited authority on marketplace selling and is author of "Turn eBay Data Into Dollars" (McGraw-Hill 2006). Her blog was featured in the book, "Blogging Heroes" (Wiley 2008). Follow her on Twitter at @ecommercebytes and send news tips to ina@ecommercebytes.com.

2 thoughts on “Lawmaker Sticks Up for Amazon Sellers”

  1. The monopoly known as Amazon has a lot of money, and their partners helping to form Amazon into an even larger monopoly (the Wall Streeters and financiers) have even more.

    They buy politician’s favors for special favors and benefits.

    Until small/medium business and people in general recognize the dangers of the Amazon Monopoly Monster, and starting pushing their legislators to break this monopoly up

    then the Monster will get bigger and bigger until it is too late.

    King Amazon will decide what you can buy, at what price, and who can sell and profit.

  2. The problem is so much worse. Amazon provides information on products that sell to overseas manufacturers. They then illegally produce the items, in my case, using my original artwork. Then, these overseas sellers list the counterfeit items on Amazon. You can report the items, once you find them, and Amazon will, in some cases, take them down. They seldom remove the sellers, even though they are usually selling many other counterfeit items that are obvious but haven’t been reported yet. Both Amazon and the overseas sellers keep the money they have made off these illegal items. You can’t touch either legally. But Amazon is knowingly participating in this criminal activity. And, they have ample means to ferret out and remove the counterfeit items. When I search for mine, I get a list, generated by Amazon, of “similar items”, which are more items illegally using the same artwork.

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