Amazon today is a street side flea market. You really don't know what you'll get. I've started ordering more stuff from traditional retailers. Their online operations these days are really good, and at most a few dollars more than Amazon. Clothes from macys.com, home goods from homedepot.com and target.com, and so on. You're not flooded with choices with these stores that are mostly garbage, instead you get only 1-3 choices that are reputable.
I think ordering on amazon has become a little like getting your car towed.
Towing companies appear to be a large shell game where your $200 tow is handled my one or more middlemen who eventually get some poor independent towtruck driver to tow you for $75
Amazon should do something that would allow partnering with decent brands. Customers would be happy, brands could keep their reputation, amazon could get a reasonable cut, and they would still sell stuff via flea-market brands and the made up word-salad amazon brands
You might enjoy “The Market for Lemons” by the economist George Ackerlof [0]. It fits people’s descriptions of what’s happening with Amazon.
His idea was: buyers don’t know if a car is good and the risk of getting “a lemon” (a bad car) reduces how much they’re willing to pay. That means sellers reduce the quality of what they’re selling or leave the market. After a while the quality degrades so much that buyers notice and want to pay even less. Eventually the market is 100% lemons.
The paper was controversial when it was published in the 1970s, but helped kick start research into “information asymmetry” and the potential for market failure.
This sounds familiar to my used car shopping experience a few years back. Went to see at least 20 private party sellers over a period of a few weeks and most were junk, bought by shady dealers at used car auctions. And their prices were well above the blue book for excellent condition, despite the cars being fair at best. I did manage to find some actual private sellers, and ended up with something I like and still drive now, but it required a lot of time and determination. I can understand why some people would just go to a lot and drive off a couple hours later
Your regular reminder that theoretical free market assumes perfectly rational and informed consumer, no lies and no misleading or withholding information
In other news a car has infinute milage on a frictionless surface in a vacuum
I'd say it's working just fine, by causing people to switch away from using Amazon. Amazon continued to lower their brand's quality and as the name becomes less and less trusted, their products are worth less and less.
Is that actually happening though? I know there's lots of anecdotes around here, but there are still many people using Amazon frequently. I wonder if their numbers have actually gone down
I mean, roughly, there's no such thing as an ideal free market, and in all real markets all the ways in which it's not an ideal free market are being exploited by people to collect the margin. The concept of an ideal free market is promulgated by the same people who are making money off those margins.
As far as what you can do about it, you could start with preventing those people from interacting with markets. I leave the mechanism as an exercise for the reader.
A free market would first require getting rid of all forms of power and so far there have been people who thought about minimizing the most impactful sources of power and pretty much all economists ignore them.
What we are doing is the equivalent of looking at a warped mirror e.g. a non free market and declaring that the reflections are not distorted e.g. a free market.
A lot of people are scared of living on the streets or feel shame from living off welfare. There is no way these people are going to make long term decisions if their short term needs haven't been met or there is a constant risk that they won't be met tomorrow.
This is actually one of the more disgusting parts of Austrian economics. Where a low time preference is basically considered the equivalent of a high IQ. If you have a high time preference you must be some dumb consumerist animal, when the truth is that you barely earn enough money to meet your living expenses which means 100% of your spending must go to consumption. Thirst is more urgent than hunger which is more urgent than shelter which is more urgent than social needs and so on. At some point you are not longer hungry or homeless. The urgency is gone. It would be more accurate to say that time preference is a function of wealth and having your needs met, rather than some intellectual jerk off competition where stupid people are filtered out and smart people end up with all the wealth.
I honestly just see a regular capitalistic market, where a company is trying to make money at the expense of other companies. By that I don't mean Amazon is outcompeting retailers and pushing them out the market. I mean Amazon is actively causing damage to well known brands by letting scammers sell those branded products to promote their own AmazonBasics brand which is free of scammers.
Even if the scams are unintended, there is no profit incentive to get rid of them.
The only time I had my car towed was in Devon, SW England, in 2020. I hit a pothole and blew out a tyre. The company that towed my car took it to their workshop, and took me to my hotel. The next day I spoke to them to organize getting a pair of new tyres. That was a challenge because I had winter tyres on as I was intending to return to Norway before the spring and no one stocks winter tyres in Southern England. It took them another two days to get the tyres. They charged me for the tyres and fitting and that was it, no charge for the ten mile tow.
This seems to be the classic underdog problem. The traditional retailers that you like today will become third party marketplaces tomorrow if they grow. So the issue is that we only get good service from underdogs and it is destined to fail once the underdog is not an underdog anymore.
Except Amazon started as a third-party marketplace. This isn't *new*, some of us just have really short memories. For the first several years the only first-party sales they did were in books (and not all books on the store even at the beginning). They've expanded into other first-party categories, but there are much fewer first-party categories than people assume. (And always have been.)
The big thing that changed isn't the third-party marketplace on Amazon, it's that they increasingly and intentionally blurred the lines between "third-party" and "second-party" marketplaces. Any third-party that uses "Fulfilled by Amazon" logistics (warehouses, shipping) just about gets automatically upgraded in the Amazon user experience to "second-party" even if Amazon has no deeper working relationship with the third-party than "Fulfilled by Amazon".
Some of that intentional blurring of the lines is also questionably Dark Patterns intentionally designed to confuse consumers in just exactly what categories Amazon supports directly (first-party) and which ones are third-party, and more importantly which ones are first-party usually versus third-party today (such as sold out goods). They want to give consumers the illusion of an "everything store" that is never out of stock. That's never the practical reality, and the illusion may be evil from the perspective of shadily pushing consumers to unvetted third parties due to Dark Patterns that back that illusion.
That doesn't follow. Just because an online retailer grows it doesn't mean they have to start allowing third-party sellers. In fact, seeing what is happening to Amazon's reputation, that seems like a bad long term move.
Short termisum might win out, but it is not a foregone conclusion.
The mechanism is the managers that take over at companies who focus on the short term bottom line (trimming support today, to juice profits tomorrow, to lose credibility years down the road after the bonuses have long landed in their bank account).
And the problem is that Amazon's growth profile (retail-side anyway) is going to be pretty constrained going forwards because they own too much of the available pie right now. So the result is that managers are going to have to look for other ways to trim costs to make numbers.
If you're starting from 0.001% of the retail market and trying to grow 10x it is much easier to do that just by having really good customer service.
This comment is peak short-termism! It is comically absurd to refer to 25 years as a long time!
There are companies that have been around for 300 years, in fact prior to rise of venture capital moat companies were multi-generational family business and you would consider how a decision would reflect on your children.
> Just because an online retailer grows it doesn’t mean they have to start allowing third-party sellers.
Why do you believe this? Not one of the top 10 online retailers in the US doesn’t have third party sellers. It appears to be the case in practice that growing does require opening the doors to anyone and everyone, which obviously increases the scale of business a retailer can offer. There are both reasons and evidence to suggest third party sales are what it takes to grow to even one hundredth the size of Amazon.
> seeing what is happening to Amazon’s reputation, that seems like a bad long term move.
This seems like a big assumption. There is a very long list of corporations and monopolies with relatively bad reputations that are doing just fine and have for a long time. Reputation isn’t a good measure for the success or future prospects of a company, once it gets large enough.
I agree it's not a foregone conclusion, but it's also not far fetched. That's what happened to newegg. They tried to turn into an amazon and now I have a hard time trusting them.
Ordered some things from walmart.com, half of it was third-party sellers. They were sort of transparent about it, though, and the quality was at least what I'd expect from inside a Walmart.
Yep. I've been ordering from Target, Best Buy, and Walmart much more often these days. I just assume the product descriptions and reviews on Amazon are all lies.
Target and Wal-Mart also sell third party shit. It's easier for me to just buy directly from brands I like, or to shop for them on a couple outlet sites I trust (so far) to sell legit (overstocked or lightly damaged) top-quality stuff and not lower-quality second- or third-tier versions (as some outlet stores do), than figure out how to avoid or disable displaying third party sellers on a bunch of different sites.
By the time you factor in the time and frustration for that, any savings (which isn't even guaranteed) doesn't look like great ROI anyway. Plus, even Amazon often won't carry the full range of a brand's products, so I get more options shopping this way.
Best buy is filled with 3rd party sellers too but it's at least very easy to filter them out. If I could do the same on Amazon I wouldn't have any problem with 3rd party sellers, but they instead make it almost impossible to know even if you check manually.
That and Amazon commingles their inventory with 3rd party inventory, which can sometimes be counterfeit. And Amazon doesn't care if the counterfeit products are mixed in with the genuine products in their warehouses. As far as I know, Best Buy/Target/Walmart don't commingle their inventory with 3rd parties because they have physical stores that they can pull from.
True. But stores like Target also let you see inventory in physical stores, so it's easier to purchase an item you know is coming from a Target store/warehouse than a 3rd party.
Do they still allow listing different products on the same page, with the same reviews?
You can read reviews for a whole different model of headphones or kettle, for example, but what you get is another, (usually) cheaper model/revision. Which is insane!
Negative reviews are silenced. I ordered a machine with missing parts such that it couldn't be assembled. I gave a 1-star review and it never appeared on the seller's page.
Target and Walmart take online returns at their stores, which no one in the supply chain likes. They will take bad suppliers to the woodshed if too many returns of an item. Hence they have skin in the game to carry quality products
I didn't say I trust reviews on Target. Paid reviews exist everywhere. But if I have to choose, I'd trust Target's first. Amazon's extensive 3rd party marketplace is set up in a way that encourages vendors to game their system. Amazon does nothing about it because it's good for business.
And I trust Target's products are genuine and what you receive is what's in the product description, because they sell them in stores.
Agreed. Last example was LED grow light I purchased and description said had a grounded plug. When it arrived there was only a 2 prong plug. I’m weary of everything I buy there now and try find a manufacturer direct order when possible. Fulfilled by Amazon should read as a warning sign.
> Amazon today is a street side flea market. You really don't know what you'll get.
There are two time when I will use Amazon nowadays:
1) If there is an official store there
Anker is a good example of this. It seems like Amazon doesn't commingle inventory if there is an official store.
2) If I want something faster than Alibaba/Aliexpress
Quite often I can find the exact Chinesium equivalent on Amazon and I get the benefit of returnability if what is advertised is completely out of whack.
This has to be costing Amazon money, but, it's their funeral.
