Hacker News Reader

Comment by kristianc | Hacker News Reader

This is more or less what Amazon is known for - experimentation, A/B testing and dumping ideas quickly.

I'm pretty in awe that Amazon seems to have (at least) three bricks and mortar retail concepts on the go at the same time : Go, pop up stores and Whole Foods, and is only now deciding to cut one of them. Amazon's commitment to going with the data goes so so deep.

View on HN

I think Amazon doesn't need those pop-up stores now as much since they could easily use Whole Foods stores to display and sell their hardware devices. They also have other options as well to sell devices such as their Amazon Books physical stores.

They already do, at least here in SF

There are Amazon devices in the Washington, DC, Whole Foods stores.

What about Amazon makes it successful with having multiple versions of the same concept at one time compared to Google's* lack of success doing the same?

*At least my impression of Google and their structure/incentive system that pushes different groups to pursue the same thing and not succeed at any. Messaging is at the forefront in my mind.

Follow-through.

Google is infamous for this sequence of events, time and time again:

1. We made this great new thing that's gonna change the way you verb! Hope you enjoy it!

2. (1-5 years of product stagnation)

3. Hey, thanks for the all the good times. We're closing the thing at the end of the year.

Amazon (for all their warts) is much more adept at keeping customer experience in their crosshairs.

> Amazon (for all their warts) is much more adept at keeping customer experience in their crosshairs.

Except when it comes to selling counterfeit merchandise. This is more than just a nitpick, they are cannibalizing their core business. What I don't know, and I assume they do know, is how bad is the problem. Is it impacting 1% of customers who ultimately leave their platform (which could easily be offset by other factors), or are we at the tip of the iceberg and they're going to continually lose marketshare with time?

There’s been a lot of heated discussion about this on HN previously, but it would be interesting to know 1) how big of a problem it is, and 2) what people are buying that seem to have this problem.

My household buys on average 10-20 items from amazon each week for many years (combined personal, my business, my wife’s business) and have yet to receive a counterfeit item. Am I doing something different?

Amazon's last 10-K report specifically listed counterfeiting as a risk factor for investors. Quote:

"Under our seller programs, we may be unable to prevent sellers from collecting payments, fraudulently or otherwise, when buyers never receive the products they ordered or when the products received are materially different from the sellers’ descriptions. We also may be unable to prevent sellers in our stores or through other stores from selling unlawful, counterfeit, pirated, or stolen goods, selling goods in an unlawful or unethical manner, violating the proprietary rights of others, or otherwise violating our policies. Under our A2Z Guarantee, we reimburse buyers for payments up to certain limits in these situations, and as our third-party seller sales grow, the cost of this program will increase and could negatively affect our operating results. In addition, to the extent any of this occurs, it could harm our business or damage our reputation and we could face civil or criminal liability for unlawful activities by our sellers."

https://ir.aboutamazon.com/node/32656/html

Anecdotally, it's trivially easy to find obviously counterfeit products on Amazon. For example, the eighth result when I search for "yeezy" is this listing for an obviously fake pair of Adidas Yeezy Boost 350 v2 shoes. In many product categories, Amazon looks more like a seedy flea market than a multinational retailer. I have no idea what proportion of supposedly legitimate listings are for counterfeit products, but I have personally received counterfeit SD cards and USB chargers.

https://www.amazon.com/HEIMA-TRADE-Lightweight-Breathable-Ru...

https://www.flightclub.com/yeezy-boost-350-v2-white-cblack-r...

I agree with their assessment that the A2Z Guarantee is a financial risk as the potential for counterfeits increases with scale. Amazon returns are shockingly easy and I am always given the benefit of the doubt. Makes sense that they would call that out as a risk factor.

That listing for the "yeezys" you linked, though, is a great example of something I would never even consider... I don't have a specific heuristic for how I select products, but this listing violates a lot:

-Prime availability

-Multiple sellers with extensive trading history

-At least 10 ratings and preferably at least 100

-Rating above 4* and maybe 3.5* if there are limited options

-Description that is written in legible English and reflects the copy on the item as found in a store

-And only after multiple searches using different search terms to identify the "right" keywords that bring the most relevant products

This has and will be a problem on any platform, whether it's eBay or Alibaba or on Canal Street in NYC [1]. If it seems shady, it probably is.

[1] https://www.unpublishedarticles.com/handbags/

Hair products are heavily counterfeited on Amazon - I only buy them direct from companies now. High end shampoo/conditioner/treatments can cost $50 a bottle for large sizes. They're just colored plastic bottles with text and some gel inside. Trivially easy to copy the bottle, costs essentially nothing to produce, and only obvious that it's fake to the consumer that receives it, not others involved in the supply chain.

Do the listings say "Sold and shipped by Amazon"? If so, Amazon has procured it. If it says "Fulfilled by Amazon", anybody in the world sent the product with a matching UPC label to the fulfillment center and Amazon shipped it.

I thought I'd heard that they were commingling their own stock too, so even sold and shipped by amazon is no guarantee.

It's possible your sample is not representative of the larger sample.

My understanding on this matter is Amazon is going the way of giving the brand owners more control of the brand as one part of the solution. Ultimately they know their product(s) the best and are likely most aware of matters no heuristic is going to catch. Maybe it can be used to train an automated counterfeit identifier since this solution only scales for large brands that have resources already dedicated to the problem. You still get stuck with a McDowell's vs McDonald's problem of brand erosion from very similar knockoffs that tread the legal grey line.

The problem seems to exclusively affect HN commenters, who have the remarkable misfortune of having every single item they buy off Amazon turn out to be counterfeit. It's a total scourge on the community of HN but miraculously doesn't seem to affect anyone else.

Occasionally I'll see a broken-English listing from a third-party seller advertising a $800 camera for $200, but when that happens I just...don't purchase the obvious counterfeit product.

> The problem seems to exclusively affect HN commenters, who have the remarkable misfortune of having every single item they buy off Amazon turn out to be counterfeit. It's a total scourge on the community of HN but miraculously doesn't seem to affect anyone else.

I'm sure that much of the anecdata on HN unfairly paints Amazon in an poor light in regards to counterfeit goods. At the same time, I suspect that many, many people have bought counterfeit goods on Amazon and don't realize it.

One side issue you'll run into when discussing things like this is a major response bias. People who have neutral or good experiences are far less to chime in saying as much. By contrast you'll have a very large percentage of anybody who ever had a negative experience say something.

Like I suspect the vast majority of people, I've ordered plenty of items from Amazon and also never run into a single counterfeit.

---

As a tangent, you could also apply this same bias to driving the things like the division in social media. People surround themselves with people of the same affection and biases which, in turn, ends up being seen from their perspective as 'normal' which, in turn, drives radicalism since their distorted perspective creates a false reality.

So I've been using Amazon for years, and only had a bad experience once. I always used to use Anker products, especially their screen protectors that were cheap and worked well enough.

I ordered the exact same listing maybe 4 or 5 times (at the top it would say 'You ordered this item on XX.XX.XXXX) and the sixth time I ordered it, what turned up wasn't Anker at all, and wasnt' even pretending to be. The pack was completely different and this was from a store listed as 'Anker'.

Of course, Amazon refunded and sent the correct item but it does happen.

I suspect there’s something to what you say. People buying on price are more likely to hit counterfeits. It’s also statistics. With a large enough population, some people are going to get unlucky purely by chance.

But how else can I be a disruptive hacker if I don't buy $800 cameras for $200?

I've been wondering for a while why Amazon has been letting (my impression of) trust in the listings on its retail site be eroded so much.

My best naive wild guess (as a techie, not an MBA) is that a solution is Amazon private brands. Amazon could exercise control over the supply chain, could keep other sellers from piggybacking on a listing, could keep the reviews generally positive (in various ways, including aggressive investigation of suspected fake negative reviews), and could even have customer service treat private brands more favorably than many others. Plus preferential listing and smarter targeting.

Meanwhile, most other brands would still have to be on Amazon, but suffer the current awful environment of counterfeits, reuse of listings for different products, fake reviews on their and competitor's listings, etc.

This is basically already happening. There is a long list of Amazon-owned brands - not just AmazonBasics anymore

The wild speculation part is that a plan for building trust in Amazon-owned brands could explain an appearance of foot-dragging in fixing trust problems hurting other brands.

> Except when it comes to selling counterfeit merchandise.

Bought Gold Toes on Amazon. Squeezed my feet causing numbness. My wife reported the same with her much smaller feet. Manufacturing defects too. Nice, higher end semi-gloss cards and packaging, looked legit. Sold in packs of 6 pairs.

Bought Gold Toes at Macy's. Comfortable fit, no numbness. No manufacturing defects. Not letting my wife touch them. Sold in packs of 8 pairs. BTW $3 per-pair price actually less than Amazon even though not on sale at Macy's.

They just launched project zero, so at least they seem to be addressing the issue.

https://blog.aboutamazon.com/company-news/amazon-project-zer...

“We’ve been testing these automated protections with a number of brands, and on average, our automated protections proactively stop 100 times more suspected counterfeit products as compared to what we reactively remove based on reports from brands.”

What’s scary is the implicit quantity of counterfit products quoted here.

Seems really cool. Serialization is the answer: manufacturer sends exact serial numbers electronically before shipping merchandise. Serial numbers are scanned with barcode readers on entry to fulfillment center and as they are picked/packed for delivery. There should be zero chance of co-mingling if done properly.

Amazon does do this - it's called Amazon Transparency. https://brandservices.amazon.com/transparency

Given the incredible disregard for correct usage of GTINs by Amazon on Amazon.com I've seen in the past, I'm very surprised that this exists.

Wow that is an extremely unfortunate name, it almost seems like they’re maliciously trying to ride the positive and successful associations of the existing Project Zero.

I'm going to guess that many, like myself, have no idea what the existing Project Zero is, and I would venture a guess the people that named this were in the same boat.

I'd even surmise that it's not a particularly unique or interesting name.

Obviously they must know it's a problem, but it seems to be a constant arms race fighting with the counterfeiters, especially with their current business model.

It seems pretty clear Amazon is moving away from being a direct retailer of items and instead fulfilling orders for other stores. Moreover, they're leaving it in the hands of these storefronts to differentiate themselves by having them pay extra to separate their stock from other warehouse goods.

Lastly, it seems as if the end goal is for the retail store to become a platform for a new wave of direct to consumer manufacturers, which you see in the form of Anker, that trending Orolay jacket, etc.

Their in house brands are a large and growing part of the marketplace, so it's not quite right to claim they're moving away from being a direct retailer. Perhaps "retailer of other brands" is where they're moving away from but even that I'm not positive there's been any meaningful change of late.

Even their house brands are sometimes outsourced - its been reported here that counterfeits occur even among them.

I don't encounter many counterfeit problem as people here seem to be frequently hit. I use Amazon quite frequently, more than one order each week.

Disclaimer: Ex-Amazon employee.

The line in the sand for me was when I purchased new socks and, fresh from the sealed plastic wrapper, they just didn't have that glorious new-sock feel. Washings later I can still tell the difference between the counterfeits I got online and the real ones I got in a store, and it is always a little let down when they come up in the sock rotation.

I've bought the same Hanes underwear from different stores at different times and gotten very different sizes and material quality. Sometimes what seems like a counterfeit could be just manufacturer material/parts sourcing and factory variation.

They measure counterfeit complaint rates with a PPM metric.

I'm going to miss Inbox. Sure they merged a bunch of features back into Gmail, but they still don't provide some of the greatest ones - such as context aware grouping. Planning a trip? All the emails from the various services you reserved (airfare, rental car, hotel, etc.) get grouped under "Your Trip to X" automatically. Or the grouping of GitHub emails under a group per repository or organization with buttons such as "view pull request" or "view issue."

Or that their desktop web experience was the same as mobile experience.

That's an interesting question, imo. Google is (was?) also very well known for (A) making decisions with data and (B) letting flowers bloom, fail, and moving on.

You could describe both with the same shorthand cliches, but they're obviously very different.

I think the difference is how intentional they are. In this case, they want to do physical retail. They have certain ideas about what meaningful wins they can achieve in retail. What they're "testing" are, in a very broad sense, implimentation details and approaches. They are intent ona destination, but very expiremental about the route.

Google is/was either more "blue sky." They "expirement" more like a VC or incubator expirements. It's more about making likely betys than finding a way to do X. Anything that seems promising is worth a go. They have certain areas (ML, web/mobile platorms) that they invest particularly heavily in, similar to a VC's specific health-tech or ed-tech funds, but the destination is blue sky... "change the world and make billions with ML."

I would say amazon does it more like a startup, and Google is more like a startup investor.

BTW, sometimes one works and sometimes the other works. Google (mostly via android) had far more success in mobile devices/OSs, even though both attempted it.

I think you have to give the edge to amazon though. They managed to build a new business that was better than the old one. Google still makes all its money fom search+ads and supporting stuff. Even their big product successes (android, chrome, drive/docs, maps, etc.) are not money spinners. They arguably support the search+ads business, but nothing is in the same league as aws.

What surprises me about the Google attitude is that it seems to go against one of the basic rules of entrepreneurship: that it's the execution that counts, not the idea. In other words Google seems to throw multiple ideas hoping for some to be successful, but doesn't really seem to put an effort to push them forward despite the initial difficulties. It's a fundamentally insecure attitude: they hope to be blown by the success of something rather than working hard to make it succeed.

It's their strong customer and product focus. I answered in more detail in another thread:

https://news.ycombinator.com/item?id=19286649

I think it comes down to how they handle success at a smaller scale and tend to prioritize for their higher value experiments. I think the better example, on the other side of Google would be Apple, where almost all priority is in the Phone first, Tablet second, everything else after.

For google, you have one line of business than generates billions in revenue and another that generates a few million in profit, in the larger company, it's not likely to gain traction, where in another company it might be larger than the rest of the company.

> I think the better example ... would be Apple, where almost all priority is in the Phone first, Tablet second, everything else after.

To be fair, the iPhone has been an earth shattering success that created multiple brand new markets (e.g. App store, Apple Pay) and propelled Apple to become the first trillion dollar company in history and the most valuable brand in the world. It's difficult to convincingly make the case not to prioritize a product line like that above others.

They have enough funding they could easily have spun of both MacOS and the Macintosh hardware into separate sub-companies or reorganized the organization structure a number of ways not to let things stagnate for over half a decade. MacOS and even the hardware largely feel like how IE6 was for the longest time.

I think it's 5: Go, pop-up, 4-star, bookstore, whole foods.

I do hope 4-star works out. It's worked great for me a few times for last minute decent gifts (including for a kid and difficult to buy for relative).

Also the 365 grocery stores.

Those have been discontinued.

I was about to correct you since one opened near my house, but it sounds like all 9 of the 365 stores will be converted to a regular Whole Foods by the end of the year:

https://www.eater.com/2019/2/27/18243123/whole-foods-365-sto...

I saw in WSJ that Amazon is planning to open an all-new "cheaper than Whole Foods" grocery-store business with the first store in Los Angeles to open by year-end.

https://www.wsj.com/articles/amazon-to-launch-new-grocery-st...

Can't speak for anyone else, but hopefully they will not mess with Whole Foods much. They picked up some baggage with that one, and if they drastically changed things ... to put it in their language this would not be a Type 2 decision.

Welp, so much for that hope.

https://www.theguardian.com/us-news/2019/mar/06/whole-foods-...

They have ruined Whole Foods. Anecdata: the local store is now filthy, filled with unhappy employees, and no longer carries a broad selection of items. But hey, bananas are cheaper. The "customers" are mostly local delivery services now.

What changes at the corporate level caused those effects in the stores?

> Amazon also assured landlords that its decision to close pop-up stores wasn’t a sign that it is pulling back from its expansion into bricks-and-mortar retail, one landlord said.

> “The pop-up stores were designed to ascertain demand, and Amazon can leverage that data for prototypes of other stores,” said Mr. Charles Lanier, director of real estate at Plaza Associates Inc., a private commercial-property landlord that operates Crabtree Valley Mall in Raleigh, N.C., which contains an Amazon pop-up.

> Amazon is innovating at a fast pace, he said, adding, “We’re big fans of the brand.”

Reply on news.ycombinator.com