The sales strategy on Amazon and the EU antitrust proceedings
Many people choose Amazon as a platform, to sell their products, due to the undeniable success of the company in the field of e-commerce.
However, there are also concerns about Amazon's business practices. A current EU antitrust case has alleged that Amazon used its sellers' data to select new products and services that were then sold through Amazon's own retail store.
These practices have raised concerns among some sellers on Amazon, who fear that Amazon could use their sales data against them. EU antitrust authorities are currently investigating whether these practices violate EU antitrust laws and whether Amazon has unfair competitive advantages over other retailers.
Margrethe Vestager on Amazon's data-driven business practices
The EU competition chief Margrethe Vestager has emphasized that Amazon is a data-driven company that is highly automated and relies on algorithmic tools to make business decisions. The research has shown that very detailed real-time business data related to third-party offers and transactions on the Amazon platform is systematically incorporated into Amazon's retail business algorithm.
Based on these Algorithms decides Amazon, what new products are coming to market, what the price is for each offer, how inventory management is performed, and which supplier is best suited for a product. These practices have raised concerns, as some argue that Amazon's access to its sellers' data gives it unfair competitive advantages over other retailers. (Click here to read more details)
Amazon and the risk of competition
A well-known concern for sellers on the Amazon platform is the risk that Amazon may take their most successful products identified and then competes directly with them. This can mean that even successful Amazon seller ultimately lose out to the Amazon direct sales model.
The EU Competitive Authorities have taken a closer look at these practices by Amazon as part of their ongoing investigation. They claim that Amazon uses the data of its sellers has to select new products and services to sell through Amazon's own retail business. This has raised concerns that Amazon unfair competitive advantages has over other retailers.
However, this risk is not limited to Amazon and applies to any common e-commerce platform. When you as a seller sell your products on such a platform, there is always a risk that the platform will identify your most successful products and compete directly with you. If this is the case, you may end up losing to the platform and your business may suffer.
It is important that sellers focus on joint e-commerce platforms are aware that they are competing with a predatory competitor when they sell their products on these platforms. Therefore, sellers should always be aware of their Rethink sales strategies and privacy practicesto protect themselves from possible risks.
Shared platforms like Amazon have access to a variety of metrics, which measure seller performance on the platform, including pricing, sales volume, conversion rate, price elasticity, delivery performance, returns, complaints, and more.
This Data is updated in real timewhich enables Amazon and other platforms to react quickly to market changes such as price fluctuations and demand. Sellers have no way of outsmarting the platform here, as every step is monitored in real time.
Additionally, shared platforms such as Manipulate Amazon search results, to put their own directly sold products in the foreground and thus affect the sale of vendor products.
A report by the U.S. House of Representatives argues that Amazon, because of its Dominance in online retailing exercises monopoly power over small and medium-sized enterprises. This allows the company to discriminate against the competition and favor its own products, which impedes the free and undermines fair competition.
While it may seem tempting to use shared platforms like Amazon because they offer a cost-effective and easy way to get started selling online, sellers should consider the Consider riskto which they are exposed when they share a platform. On the other hand stand-alone e-commerce platforms better able to protect your business and data, but require more investment and take more time to become effective outlets.
Your own e-commerce platform
WordPress and WooCommerce are two very popular platforms that can be used together to create a powerful online store.