Reuters investigation reveals disturbing strategies adopted by Amazon in India, accused of copying the most successful products of the competition.
Heavy accusations are raining for Amazon . The e-commerce giant, already under the eye of the European antitrust due to its double “soul” of marketplace and seller, ended up at the center of an investigation by the British agency Reuters for some opaque and anti-competitive practices adopted in India , one of the fastest growing and potentially the most profitable markets.
The objections emerge from a series of internal documents published by the press agency (e-mails, projects and strategic plans), which would reveal a manipulative strategy aimed at favoring the products owned by Amazon (moreover copied) to the detriment of the similar proposals of the other brands. For its part, the US company wanted to forcefully reject all charges, as we will say at the end.
Amazon’s two-phase strategy
As can be seen from the documents, Amazon would have set up a two-stage strategy, first by scanning and copying the most popular products on the Indian marketplace and, subsequently, pushing the sale of proprietary solutions (rather than those of the competition) through an ” adjustment ” of the results. of the internal search engine. Hence the pressing requests of the EU Commission to separate the two activities.
To achieve this goal, the company founded by Jeff Bezos would have used two absolutely central tools: on the one hand, the so-called ” views at a glance “, that is, the data that indicate the products most viewed by consumers based on searches on Amazon; on the other hand, the alteration of the search algorithm through the ASIN (Amazon Standard Identification Number), the code that identifies each product hosted within the e-commerce.
The views at a glance
The at-a-glance views are a very important indicator for understanding which products to replicate, also thanks to a combination with data on the best-selling products by category. It is a tool that is inaccessible to the competition and of which only Amazon is fully aware: hence the first advantageous position of the American giant would arise, which would exploit the popularity assumed by competing products and become true inspirational muses.
As an internal Amazon document reported by Reuters reads , having such data streams is “a great opportunity to influence interested customers who are considering a purchase in a product category .” Moreover, the British news agency would have obtained evidence regarding the existence of an internal Amazon research program , supervised by at least two senior Amazon India executives, with the purpose of probing and copying the most successful products of the competition. . And here are cited by the source, in order to avoid remaining in the aleatory, some Amazon.in best-sellers, such as the John Miller shirt brand, owned by a company attributable to Kishore Biyani, better known in the country as “the king of retail trade”. Well, it seems that Amazon has copied the measurements of John Miller shirts, from the circumference of the neck to the length of the sleeves.
The ASIN algorithm
It is not enough to copy a successful product, but also to sell it at a profit. And here comes Amazon’s second manipulative strategy: altering search results to ensure that Amazon-owned products always pop up at the top of searches. A “hand” that would have allowed the US company to collect, according to the data collected, over 600 million dollars in revenue from sales on Amazon.in of products made by the e-commerce giant itself.
Two examples of alleged copies of Amazon in an image reported by Reuters: on the left the “original” model, on the right the one reproduced by the e-commerce giant
The Solimo case
There is a precedent that would seem to best embody the winning – albeit anti-competitive – practice charged to Amazon: the line-up of Solimo brand products . Yet, at the beginning things did not seem to go the right way: the objects, which crowd various consumer categories on Amazon.in, had earned just over 100 million dollars in revenue, in the face of a huge and potentially very large market. profitable. According to Reuters allegations , Solimo-branded products would have benefited from the adjustment we have talked about so far. At first by copying the equivalent objects of the competition and then constantly fixing Solimo products, which are sold 15% less compared to those of rival brands.
This strategy would then be replicated in America , involving, according to the source, the same market segment of the American furniture company Williams-Sonoma Inc and the sports footwear brand Allbirds : the former, however, had already expressed its perplexities. in order to the moves of Amazon, accusing in 2018 the company founded by Jeff Bezos of copying its products. Words that three years later seem to sound like a flashback . In any case, the sales model relaunched in America – based precisely on the Solimo experience – would not have obtained the same results achieved in India.
Amazon’s comment
Amazon’s response was not long in coming and goes diametrically opposite to the content of the investigation reported by Reuters . The e-commerce giant has rejected the accusations against the sender, arguing through a spokesperson that ” it is not possible to confirm the veracity or otherwise of the information and statements reported, as the news agency has not shared the documents with Amazon or their origin “. In any case, the American company wanted to clarify that ” the information reported is incorrect , as well as not supported by facts. Amazon continues to strive to bring excellent service to its consumers and help small businesses in the
Meanwhile, US Senator Elisabeth Warren returned to the attack against Amazon and wrote on Twitter the importance of “breaking up” the business of the e-commerce giant.
