I'd argue that Newegg was more hurt by this than Amazon, because customers were trusting Newegg to deliver a consistent experience at the expense of fewer categories of inventory, while Amazon's offerings were already diluted by a smattering of tiered experiences and bundling with tangentially-related services, of which the Prime/not Prime distinction became increasingly more intrusive.
Though many people use Amazon to find quirky, oddball, one-off products, it does tend to work best when used as an online-only warehouse club -- for repurchasing the same mainstream product over and over; with the added benefit that then you largely avoid having to wade through the filters of 'Sold by Amazon' and 'Eligible for Amazon Prime'. And since they pushed Prime on so many people, they can branch out into eBay's territory with little worries about the health of their customer-facing bottom line.
I'd be really interested to see what Amazon's numbers as a whole would look like if Prime didn't exist, clearly it is profitable enough for Amazon to be able to keep bundling "free" stuff into the package like video / music, file storage etc.
"The most important factor about membership fees is that they go straight to the company's bottom lines. Costco operates its warehouses on essentially a breakeven basis, making its profits on memberships instead of merchandise. "
https://www.fool.com/investing/2016/08/18/what-do-membership...
I'll have to come up with a formula based on the numbers in your article. It'll be interesting to see how accurate that "profit from memberships" statement really is.
I never buy from third-party sellers in Amazon, but I am having such a hard time explaining to friends and family how to do the same. They keep buying from third-party sellers and keep wondering how it is not "Amazon".
I wish there was an option to set it once and never see third-party seller items again.
https://news.ycombinator.com/item?id=13924546
https://news.ycombinator.com/item?id=13955981
I like the convenience and selection of Amazon, (and have been a customer since they started) but until they stop this comingling, I feel I have to be a little more careful what I buy from them.
Sorry to sound like an Amazon fanboy, but what else could Amazon do for you?
They offered a return without even questioning you. I don’t know a lot of companies that would do that.
Apple bought a bunch of chargers and found over 80% were fake iirc.
If you buy a charger/power brick on amazon, from any vendor, amazon's unethical inventory mingling and lack of care mean there's a very high chance you get a cheap chinese knockoff that wouldn't come close to passing UL.
ps -- I told amazon about a charger they had with a fake Intertek (a UL competitor) mark. Their response was to offer me a refund... and keep selling the device. Which (imo) should be illegal to sell.
Why they choose to mingle their inventory with 3rd party inventory is beyond me.
There's an automatic right to a refund within 14 days of delivery in the EU, so every company must offer that. I wonder if that means these frauds don't happen here?
http://europa.eu/youreurope/business/sell-abroad/on-line/ind...
This is my biggest issue by far as a customer of Amazon.
I have zero interest in buying anything off Amazon that isn't Amazon fulfilled with Prime shipping because virtually 100% of the reason I use Amazon is the quick, predictable shipping. While they do have various filters to show only prime-listed stuff in search results, the system is real fucky and you still end up getting into situations way too often where you are seeing items that can only really be bought through third parties (eg. the same SKU sells on Prime and via third party, so it makes it through the filter, but the prime option is sold out).
My enjoyment of using Amazon as a buyer would increase by like 100% if I could just tell it to act like anything not available through Prime just doesn't exist to me.
So you check mark the little box on the left that say "Prime" and it removes all non-prime listings...
Checking "Prime" includes only those listings that are prime. It does not remove non-prime listings.
3rd party sellers are usually fine.
There are things I check for:
1. A "critical" mass of 4-5 star reviews
2. Prime Shipping
3. History of selling the types of items I want to buy.
If I am going to buy from someone who is a one-off seller, I'll do so locally via Craigslist, or OfferUp.
I get scared off by seller names that sound like alphabet soup, small numbers of sales and reviews (for a $5 item I'll chance it, though), and recent reviews suddenly changing for the negative.
And I'm really skittish about clothing, unless I know the brand. Too many times, I've gotten what was listed, technically, and it really isn't what I was thinking. T-shirts that look glorious but are really crappy iron-ons, shirts that look great but are really, really thin... that sort of thing. I don't want to go to a store, but I order brands I like and trust directly from them instead.
I also use only sellers that have many reviews and 90+% positive.
- Small screwdrivers/hex keys
- Breadboards
- Hookup/jumper wires
- Perfboards and copper-clad FR4.
- Bulk discretes like resistors/capacitors/buttons/potentiometers/LEDs. Especially buttons.
- Springs
- Bolts, nuts, spacers, etc.
- Common microchips (a bit risky, but these days at the IC level, knock-offs are often sold as their own similarly-named brand at a steep discount. You're usually fine if you pay the prevailing price and don't scrounge for a suspiciously-good price. Issues like the famous FTDI bricks are rare, so again, okay for hobby work.)
- Active elements (ceramic heating elements, piezos, peltier modules, small DC/stepper motors, pumps, etc.)
These are fairly specialty items, but there is still enough of a demand for several players to take advantage of arbitrage with shipping and bulk discounts. The quality is bland and rarely outstanding, but it is fairly consistent. While I wouldn't use most of the stuff in a critical product, I still have a lot of hobbying to do and frankly I can't afford high-quality parts/equipment for all of my projects.
If Amazon banned third-party sellers, they would not bother stocking most of these niche items. I would have to go somewhere else; ebay, or making strategically-timed Taobao orders to minimize international shipping costs and the weeks of waiting. Companies like Adafruit, Seeed, Shapeways, Tindie, Etsy, and Sparkfun would probably step in with their own centralized 'hobby marketplace' offerings that Amazon's current customers would hop to.
That said, I do agree that they should at least make a search option to filter them out.
They have a filter "Free Shipping by Amazon" under "Eligible for Free Shipping". It should filter out most if not all items not serviced by Amazon.
Would love to see some official response now that the story has hit HN.
Does it actually make any sense now? Wasn't it confirmed many times that Amazon just ship it to you from closest warehouse even if it's item by 3rd party seller?
1. Sold and shipped by Amazon
2. Sold by third-party, fulfilled by Amazon
3. Sold and shipped by third-party
I never buy (3) and generally avoid (2) when there is a possibility of counterfeit, but otherwise I agree with you (2) is fine.
Perhaps blocking all the 3rd party sellers and/or checking with fakespot.com then injecting some <div /> in the page displaying some sort of rating...
Any shopper who's been burned will still use Amazon in the way you are, just being careful to filter by Prime and/or Fulfilled by Amazon. So the damage to the core brand is minimal even for rare cases like OP, who even ends his article with "even if it’s through an online retailer as trustworthy as Amazon." Despite this experience, he'll still buy his memory cards and Whole Foods groceries over Amazon Prime.
And I'm not merely careful to filter stuff. Amazon is no longer my go-to in general. I do buy stuff from them sometimes, but they're not the first place I check for most things.
A less savvy buyer probably won't even do that. If they get burned too badly on an Amazon purchase, they'll just abandon Amazon, not learn which checkboxes mean "hide the scams."
If I have to do careful homework on the seller for any Amazon purchase anyway, it's just as easy to find a more niche e-commerce site, or use a dedicated marketplace like eBay or Craigslist.
I still use Amazon's dedicated product sites like Zappos or Diapers.com. I feel much confident I'm going to get what I ordered there than on Amazon.com.
To be clear, there are some specific purchases I would not make over Amazon. Amazon's clothing section is a complete joke, for example. I also like B&H, and use them when buying high end equipment.
There isn't any general-purpose store I prioritize over Amazon, but usually I know which stores sell the things I want. For example, Home Depot often has better deals with less search hassle than Amazon for hardware stuff.
The fact that Amazon's search is essentially unusable is a longstanding criticism.
My go-to is now froogle.com (Google's product advert index). It used to be Amazon, but they have way too many issues now.
Shame because I previously bought dozens of books completely hassle-free
For things that I absolutely 100% want to get without the hassle of dealing with fraud, I'm back to the online stores of traditional retail places. :(
If Amazon could clean house of all that trash, I'd probably move my shopping back.
I only buy used camera equipment from B&H or Adorama, and even with new equipment I am very cautious on Amazon. I tried getting used lenses a few times on Amazon and every single time the first order was the wrong, cheaper version of the lens I paid for. Amazon always quickly sent the right one, but I'd rather not deal with hassle. Particularly, since at that price point B&H or Adorama both have free shipping.
You figure they'd have filters for these things.
I think the main reason is that it gives Amazon huge amounts of market data essentially for free. For example, they can easily identify best-selling new products even if they're not sold directly by Amazon. If you're successful selling stuff on Amazon, it's only a matter of time until Amazon will compete with you and possibly destroy your business.
Mind you that this is not just a "when Amazon turns bad" scenario, but actually what they are doing daily. When I was writing software for Amazon sellers, their most profitable items were always some new niche product they discovered and worked well for ~1 month until Amazon swooped in and sold the same thing.
The problems with fraudsters makes it enough of a cognitive burden to buy small items at a reasonable price -- which often are cheap knockoffs requiring careful vetting or overpriced resellers -- that I routinely find myself thinking "Eh, maybe I'll just stop by the store on my way home."
It's not that I'll stop buying things at all from Amazon, it's that other sellers now have a chance to make their case for my dollars because Amazon isn't a clear win in terms of effort involved, satisfaction with purchase, etc and that I no longer feel comfortable making impulse buys -- I have to second guess the quality of the product, which often means I just won't buy it.
My Amazon bill is down ~25% YoY because of that.
Meanwhile, as Amazon has descended to the realm of YouTube comments[2], my local retailers have actually been getting pretty good at this whole online shopping thing. Which isn't terribly surprising, come to think of it. Even smaller department stores like London Drugs have been doing searchable inventories, order fulfilment, curation, and distribution for a hell of a lot longer than Amazon. All they needed was the technology and the incentive. I think it's a matter of time until people realize there are better options and just leave.
[1] The size sold by Amazon is of course measured in shekels, while the others are measured in furlongs and picoparsecs.
[2] I'm being rather unkind to YouTube comments.
The big issue is scammers ruining it for everyone
I think Amazon lose money on lots of its own services to drive customers in, and force 3rd party sellers to use its service for a nice commission.
I just avoid amazon.mx and buy at amazon.com.
Even when buying at amazon.com I only buy products sold or handled by Amazon. I've also run into problems with scams, shipping, etc, with third parties.
I was able to get them to reverse all the charges pretty quickly, but I still get messages from amazon mexico saying i should buy stuff, and for a while amazon.com would ask me if i wanted to go to amazon mexico when i logged in.
I have only been to Mexico a few times in my life, and my spanish is really bad. I have no idea how it all happened, since they didn't seem to be able to (or didn't) change any settings that would lock me out of my account.
Everything else I'd rather buy from the manufacturer (and pay the full shipping cost and not Amazon Prime) or a reputable distributor (digi-key/mouser for electronics, CS Hyde for films/tapes, etc).
Counterfeit items -- and the co-mingling of items "fulfilled by Amazon" -- ruined the whole experience for me.
An instance of the product that I ordered off amazon.com was received by me, with a low-quality (it flaked off in the shower...) self-adhesive paper label stuck onto to the pump bottle, with another country of origin listed.
There was also a story recently about the number of people who post stuff on ebay and just drop ship from Amazon directly. Then the customer gets the product and thinks "this is just from Amazon" and looks up the price. The seller had marked it up and the buy say "bullcrap" and returns the original item and buys it direct from Amazon. However, the actual OEM now has countless returns for no reason. The seller was just running a business on top of Amazon. This is something they have to stop.
Generally the reason any for-profit entity takes a certain action (or inaction) is... yep, for profit. Sure Amazon can have tremendous scale just retailing for itself. But becoming a marketplace greatly increased its ability to compete with the likes of eBay and Rakuten.
I also go out of my way to select the sold by Amazon option if there is one, but often times FBA or completely third-party is the only option. Marketplace increases the surface area of Amazon's product offerings and more importantly makes it a true platform. That's the kind of thinking that can scale up to multibillion-dollar business.
They are working on it though, and Vendor Express gets better every day.
To offer better selection. I dislike dealing with third party sellers as well but for certain rare items (say, used vinyl) it's the only way, and it's better than nothing.
Here are a few examples, starting with Amazon's own website explaining commingling:
https://www.amazon.co.uk/gp/help/customer/display.html?nodeI...
https://cblr.columbia.edu/amazons-war-on-counterfeits/
https://www.wsj.com/articles/on-amazon-pooled-merchandise-op...
What I can tell you though, is that Amazon is incredibly lenient on enforcing EANs. So even though there is that identifier that should be able to uniquely identify a product, often times third-party replacements for the product, or even completely unrelated items are listed under the EAN, and Amazon doesn't give a shit.
It's pretty much pure profit from Amazon's point of view. They got their cut of that $1500, and no matter how much furor comes out of this (and similar) articles, Amazon's overall brand won't be adversely affected.
After all, look at the comments here. Everyone is primarily blaming the seller, not Amazon. Amazon comes across as a secondary party to this at most.
If I was willing to carefully scrutinize sellers, comb through intentionally misleading ads, build a working knowledge of common scams, and keep all records for the occasional resolution process, I would use eBay or Craigslist.
I would much rather switch to ordering from Best Buy and Target than adapt to this kind of adversarial buyer beware model.
Not saying fraud isn't an issue, and there's certainly room for Amazon to improve in that area and keep it at bay even more, but I think the reason they don't do what you say is probably that they k ow the numbers, if they see a million third party purchase, and only 1000 were fraud, its not really cause for killing the other 990000 sales.
What are the other problems?
Anyways, I'm not defending, just surprised the HN crowd accepts a few anecdotes which are statistically insignificant given the Amazon volumes.
I see questions like, how do people still trust to buy on Amazon? Aren't they aware of all the fraud?
And the answer is no they are not, because they've never been frauded through Amazon, and know no one who has. And that's the case for most Amazon shoppers.
People on hacker news have seen the outliers, the blog post about a single third party fraudster, and a few commenters who maybe experienced something similar.
There are many great 3rd party sellers on Amazon that operate in good faith, and give just as good an experience as 1st party Amazon. But on HN, it seems people see black or white only, and somehow they conclude all black even though the canvas is majority white.
I feel like I'm back in 2000, when some people were asking: How can you trust buying anything online, aren't you afraid of the fraud?
I've ordered countless items on Amazon, in the hundreds, most from 3rd party, never got frauded, never had issues. If you go by anecdotes, add this one to your samples.
The other problems are: third-party sellers pollute the listings with unobtainable low prices, long delays, and shit products I'd never want to buy. It's common for me to find a product on Amazon only to discover that the low price I thought I was getting isn't actually available, and I have to pay some absurd shipping fee with a third-party seller. Or the cost is correct, but it'll take two months to ship. (This just happened to me yesterday with a "Prime two-day shipping" entry!) Or I have to dig past the first page of the search results because the first page is filled with nonsense from third party sellers.
These are the reasons I use Amazon less and less. Stories about fraud (and more importantly, Amazon siding with a scammer for no good reason) just add more weight.
If fraud was a huge part of their business, they'd kill the 3rd party sellers from their platform, but I doubt it is. I think it's a net positive as a whole, but a small number of customers hate it. What they need to do now is improve those quirks you mentioned. That's much more reasonable then killing the whole marketplace.
They dilute the Amazon brand to a tremendous degree. It used to be that buying from Amazon meant a certain level of quality and service. Now there are really two Amazons: the old one, and a new one that's basically a shitty version of eBay.
I have to go out of my way to avoid these crappy third-party sellers when I'm searching for stuff on Amazon. It's not a nice experience to go searching for a product and have to step through a minefield of "cheap" items that take two months to arrive, or have outrageous shipping fees, or are outright scams.
It is really worth it for Amazon to have them? I struggle to see how.