The Best Thing About Amazon Was Never Going to Last | If shopping on the site feels different now, that’s because it is::If shopping on the site feels different now, that’s because it is.
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The decline of Amazon is closely tied not just to its size but to how it has chosen to grow. Amazon is now less of a store than a mall, or maybe a sprawling bazaar. Last year, nearly 60 percent of units sold on Amazon came from third-party sellers rather than from Amazon itself. Want to set up a booth? There’s a nominal monthly fee to reserve the space. From there, though, the charges add up quickly, according to a report from the ecommerce-intelligence firm Marketplace Pulse.
Amazon takes a cut of every transaction, typically about 15 percent. For front-and-center placement, you’d better pay for one of those sponsored slots. According to the FTC, advertised products are 46 times more likely to get clicks. Call it another 15 percent of revenue. Oh, and if you want to qualify for Prime—and if you want any shot of making a sale, you do want to qualify for Prime—you’ll need to use Amazon to fulfill your orders. That’s another 20 to 35 percent off the top. All of a sudden, half of your revenue is in Amazon’s coffers.
Amazon itself has reported that all of those fees amount to a big business; the revenue generated from them has tripled since 2017, totaling $117.7 billion last year alone. But although it’s been great for Amazon, it hasn’t been great for consumers. When sellers are nickeled-and-dimed, not a lot of savings are left to pass on to you.
Amazon denies that it squeezes its third-party sellers at the expense of shoppers. “The FTC’s allegation that we somehow force sellers to use our optional services is simply not true,” David Zapolsky, Amazon’s general counsel, wrote in a lengthy response to the charges. “Sellers have choices, and many succeed in our store using other logistics services or choosing not to advertise with us.”
That is technically true, but in a world where so much of online retail runs through Amazon, choice is an illusion. Dare to offer a cheaper product elsewhere online, and Amazon might bury your listing on its platform. A heavily redacted portion of the FTC suit claims that the company “deploys a sophisticated surveillance network of web crawlers that constantly monitor the internet” for such sellers. (In his response, Zapolsky says that the FTC “has it backwards” and that the company doesn’t “highlight or promote offers that are not competitively priced.”)
Of course this is where Amazon wound up. The company spent years sacrificing profit for scale, until it had so many customers that sellers couldn’t ignore it. Now that it extracts billions each month from those sellers, it can afford to ignore those customers—or at least prioritize them less. Amazon gets paid by all of its vendors, no matter which products go in our cart.
Shoppers are not privy to any of these machinations while browsing Amazon. We can’t know which third-party sellers have been banished to the shadow realm, or how tightly their margins are squeezed. Even knowing this might not get us far, considering how entrenched Amazon is now in American life. On Monday, I went ahead and bought the Linfairy Kids Child Purple Dye Wig Halloween Costume Cosplay Wave Wig, for $19.88 plus tax. My daughter liked the curls. It’ll be here by Thursday, which is no small relief. After all, it was my only option.
Well at least the prime part is wrong. Atleast in my region. If your normal packages arrive on time and without problems, you can join prime with your own shipping. <- This is a simplified, translated and without ‘private’ info statement, a seller would need to research for themselves.
Link without paywall:
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There is a way to avoid buying utter shit on Amazon most of the time, but it’s annoying- type in the full product name including the manufacturer. Like instead of “noise-cancelling earbuds,” you have to type in “Skullcandy sesh ANC” (highly recommended and inexpensive wireless earbuds, by the way). Then the result is at least near the top of the list. Of course, this requires you to know what you want before you go there, which can sometimes, due to researching it, require going to some other website to make the same purchase anyway.
I basically don’t do non-specific searches Amazon at this point unless I want it to be cheap and I honestly don’t care if it sucks. If I buy a male-to-male cable converter and it craps out after a month… well, it was only $1.
The problem with this is that if a non-manufacturer sells the “same” product, and they both use the same warehouse, Amazon keeps both versions of the product in the same bin, and there’s no way to guarantee whether you’re getting the real product or the knockoff.
If you buy post-it notes from the official post-it’s Amazon store, they’re not necessarily giving you post-its from the official post-its stock. You could be getting post-its from seller A6Zodiyn which were never stored properly and several years old so the sticky note glue doesn’t hold anymore. But both sellers were selling post-its in the same packaging, so they’re in the same box in the warehouse and what the pickers grab is random.
But also the completely fake post-its are in that box too, and they don’t stick as well plus their color is off, and there are fewer sheets per pad. But because the outer packaging is the same, same same warehouse box.
This has been a big problem in beauty products particularly, I know. People having sudden reactions to a cream they’ve used for years, because it’s actually a counterfeit.
Another area affected by this is trading cards. If you buy a trading card pack, it’s guaranteed yours will have previously been opened, sifted through for good cards, poorly resealed, and returned for Amazon to say “yeah this looks untampered, sell it for the same vendor as new”.
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I can live with the burden of that knowledge. 😉
I personally haven’t had that issue so far, so I can’t speak for that.
That’s not the issue. If the wrong product was sent to you, you just make a refund and reorder.
Also, sort reviews for things by “newest” and read the reviews. Most of the time companies will do the majority of their fake spamming of reviews during the first weeks of release and if you read the more recent reviews you’re likely to get more truth to them. I’ve looked at 4.5 star rated stuff with a thousand reviews before, but sorting by most recent I’ve seen 4 out of 5 of the reviews show up as 1 star rated.
It’s really hard to know whether or not the reviews are astroturf though. Sometimes poor English is a clue, but not always.
That’s the point of sorting by newest. If a product has been for sale for over a month it is highly unlikely that most of the most recent reviews are fake/paid.
That’s where fakespot comes into play. I have the add on on my browser and it rates the reviews. Anything below a B is probably filled with fakes. You can even sort the entries using fakespot adjusted review scores.
This is it.
Nonspecific searches will show you the same three keyboards branded differently because they’re dropshipped by some rando, and rated highly from purchased reviews.
Always look up what you want through a actual review site (not like bestvacuumstobuy2023 .com - which are also owned by dropshipper) and then shop around on Amazon and around the rest of the internet.
I’ll sometimes buy CDs off Amazon, but even that is happening less and less.
Yessss! Awesome earbuds!
Right? I use them every day at work. They sound good enough for me (I’m not an audiophile), the noise cancelling is good enough to block out any real distractions, and the range is impressive. So is the battery life. Just all-around good earbuds and they’re like $60-70.
I love mine so much. I got it in a Costco promotion because my last earbuds were so bad I couldn’t take it anymore and just bought it thinking a higher end one would be better. Probably the best non researched purchase I had and didn’t even know they were noice canceling. Such a nice surprise haha it sounds very good to me and the battery life is very impressive!
There was a whitepaper that Amazon published like…5-10 years into their market dominance where they shared how they wanted to get into drone-based delivery because the vast majority of items purchased on Amazon were very light-weight items.
This tracks with me. The problem that Amazon solved (at least for me) was the ability to find small items that are near impossible to find in a Walmart or other superstore. For example, say you are looking for some wax for your car. You go to Walmart and you see a wall of products. Now did they put the wax in the right place or did they put it with the cleaning stuff? You spend 20-30 minutes looking for this one item that you’re not going to buy again for maybe a few years when you can go on amazon, find it, buy it, and have it at your door in two days.
Walmart and other stores have gotten better with their apps but they need to do what Home Depot/Lowes have done and do aisle AND bay, and, ideally, where on the shelf to find it. They already have this information but they don’t want you you to exactly know where it is because Walmart wants you to browse.
Same, except with soldering materials and circuit components since there’s no more Radio Shack or anything. I don’t solder super often, just to fix things in my hobby, so ordering from someone like McMaster Carr doesn’t really make sense. Amazon has been super clutch in this case
I have seen some simple solder equipment and supplies at Home Depot and Lowe’s in the last year, usually with the other electrical wiring and equipment. Of course, you still have to go out to a store and hope that they have something, because I have found both to have unreliable in stock information, but it can’t hurt if you need something same day.
I was more talking about soldering for microelectronics, not automobiles and homes
Canadian Tire moved over to digital shelf tags that link up with thier app.
Not only will the app tell you exactly where the item is but if you are having trouble there is a button on the app that will make the tag blink a bright led to help you find it.
Hah, I was pulling my hair out trying to find bouillon cubes literally the other day at Walmart. It was in the spices section, not the soups or sauces. I should’ve thought to check the website.
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Last week I canceled my Amazon Prime membership. It felt so good on so many levels. I asked myself why I am paying prime membership? For expedited shipping on products I haven’t purchased yet and don’t know what they will be? To pay for products that will be shipped in two days instead of 5 days? I can wait. If it’s urgent, I will go to a brick and mortar. Finally, for Amazon prime video, a crappy streaming service in comparison? I hardly use this streaming service. It was an easy decision.
I tend to pick up prime every few months or so when I know we’ll be making a few purchases - birthdays, Christmas etc.
About 2 months ago I did my usual google search for the prime sign up link. Hit the student page by mistake. Whatever, I thought, it’ll realise I’m not a student and bill me correctly when I don’t prove it.
Nope, I’m still on a 6 month trial and still not entirely sure how I pulled it off. But hey, that’s money better in my pocket than Jeffrey’s.
That happened to me somehow and there was no way to correct it. It lasted for over 2 years for me if I remember correctly
I’m just glad I just avoid Amazon entirely.
Same. It’s changed like 10 years ago I would say. It was always a safer bet than eBay, but it’s sort of swung back. I use eBay more now .
What are the alternatives you’re using?
I cancelled prime years ago but still struggle to find a decent replacement.
I mean, books alone are tough with AMZ often being 30% cheaper than most online retailers. In that case, I sometimes go to eBay to get a used book (if it’s not a new release).
This past week though, I bought some athletic wear, waterproofing wax, a heat gun, and picture frames. Without prime, everything was delivered within three days. For free.
I use Amazon for research and then purchase the product for about $5-$10 more on other websites, ideally the company selling on a Amazon has their own website. I’d rather pay a little more than give a dime to Jeff Bezos.
Gotcha. I was hoping there were better market places but this works too. I’ve found sometimes that items are less on a seller’s site if it’s not something too generic. Shopping can add up though if you don’t hit their minimum.
It depends on what you’re buying - I don’t buy (commodity) books much anymore so can’t comment on those. What I can say is for “random tat” that I don’t need quickly, Temu is an unabashedly “cheap chinese stuff” that is often the same as the Amazon version, but usually a lot cheaper. I’m assuming they charge less fees to the sellers. They deliver in under 2 weeks. AliExpress has now started offering the same service. Downside is there’s not really returns - or at least I’ve never wanted to deal with the hassle. However, for most stuff under $10, I wasn’t going to return to Amazon either.
For “Brand Name Stuff” I kind of go to ebay and/or the specific retailer like Best Buy or B&H or the manufacturers site. They seem far less likely now to have counterfits because with e-bay the actual seller is tied to the specific product where Amazon isn’t, and the other stores don’t want counterfeits and have a more controlled supply chain.
For stuff like spices or the like, ebay or Walmart.com seems reasonably good. Walmart also has a lot of random sellers, but as far as I can tell, they don’t do the binning Amazon does, if you buy from Walmart it’s from them, if you buy from a third party, it ships from that third party.
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It’s all being fished out of the same Chinese landfill regardless
Amazon at it’s core is a hyper-localized logistics company. Their entire product is logistics, the bulk of their revenue comes from that, and that’s how the company got started. This is just the next evolution of that as they see it, and it’s fucking gross. Other companies take their lead so as not to attract negative attention when they emulate this crappy behavior, so expect much more of this in odd places you wouldn’t expect.
I don’t get it
I worked in retail on and off for 7 years and every store charged markup. Some products were marked up 70-80%. One place I worked was Best Buy. I regularly sold USB cables where the store cost was $2 for $32.
Amazon fees are essentially their markup. It’s impossible to run a store without it
The difference is who pays the markup. Amazon charges that to the seller, and passes that “discount” to the buyer effectively locking in buyers because nobody else can afford to compete
Yeah. And that’s fine.
Cost is a concept in retail that gets manipulated a lot. In my previous example there is no way the actual “cost” of the USB cable was $2. When you factor in employees, rent, bills, logistics, customer service, etc etc the cable was likely more like $5. Best Buy made have paid $2 for that cable, but the actual cost to sell it, taken as a whole, was more like $5.
That other $3 is essentially what Amazon is making. If you sell on Amazon they build and maintain the website, logistics, warehousing, etc etc. You can create an online store and have exactly 0 employees or logistical infrastructure. Amazon has spent literally billions and billions of dollars building all of that.
Amazon is the mall Best Buy is paying rent too. It’s not a store itself but overhead the store pays.
To use your example if the cost of the cables is $2 and the selling price is $20, Amazon’s rent is $10 of that. Leaving $8 as Best Buy’s profit margin.
Exactly. Amazon is essentially running a huge chunk of a retail business for their customers, the people buying and selling products. The reason you pay these fees is so you don’t need to run a website, build and maintain warehouses, pay staff like HR, etc etc
This is why the mall or bazaar analogy make more sense. Kind of.
When you buy things from Amazon which Amazon purchased from a wholesaler, this is the same as going to a retail store. (In recent years, Amazon has become their own wholesaler / manufacturer.)
But what has become more common is the “retail stores” are buying from wholesalers and then listing items on Amazon.
So, if you’re selling pet goods and you pay $2 for a bone wholesale that you’d typically resell for $5, Amazon is cutting into your profit and making it more difficult for you to market your product among competitors.
Although, there’s been a couple times where I’ve gone to a seller’s website and found the same product they had on Amazon for less money. So I wonder if sellers aren’t marking up products that are less competitive to account for Amazon’s cut.
