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Comment by thoraway1010 | Hacker News Reader

This is totally false - the number of retailers who have testified before congress that they don't use seller data to compete against sellers - and then who go ahead and do just that is basically zero.

Additionally, most other retailers actually BUY the third parties products and take the risk of promoting and selling it. On Amazon third parties take the inventory and many other risks and may have to pay amazon to promote their product.

The story here is that amazon has testified it does not do something, has supposedly the "highest ethical principals" - yet goes ahead and does exactly that which it said it doesn't do.

Do that not matter to you from a trust / credibility perspective?

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This comment is based on a misreading of the very testimony you're referencing. As quoted in this CNBC article.

https://www.cnbc.com/2019/07/16/amazon-tells-house-it-doesnt...

"Nate Sutton, associate general counsel at Amazon, told lawmakers the company doesn’t tap data from individual third-party merchants to determine what new products to create."

Of course they don't use data from individuals, they use all of the data, in aggregate, from everyone including themselves.

Amazon has promised individual sellers it would not use the data for their products to market against them (not individual buyers).

Despite the ludicrous lengths Amazon goes here to say there were multiple sellers and so this data was aggregate, we all understand (and amazon did too) that if you generate statistics such as median sale price per month / day etc where 99.95% of the data comes from one seller, you have the data from that seller.

> Amazon has promised individual sellers it would not use the data for their products to market against them (not individual buyers).

Again, there's that word. Individual.

They get off on a technicality with that comment to congress. The second you have even 0.05% (Your example, not mine.) of any category occupied by a second reseller, you're no longer targeting individuals -- you're entering a 'product vertical'.

Amazon does exactly what you're claiming they do not.

If they aggregate data from individuals, they're using the individual's data. They didn't get off on a technicality, they're simply lying.

and they don't even have to use merchant sales data to determine what product to go after, just search click troughs are enough for that.

Major retailers buy and sell their product line data from neilson and others. I worked on a project with one of them so I know first hand. So the idea that they don't use seller data to market their own products has to be false.

And amazon sellers can sell their data (and do sometimes) as well. All that is fine.

Remember, for major retailers, a) THEY are the seller in most cases and b) in most cases they get mfg's to agree to whatever is going on in the agreement UPFRONT.

I mean, let's be objective for a minute here. Do you really believe that Walmart, Target, Costco, Kroger, etc, are more ethical with their suppliers than Amazon?

Let's not forget that many of these large retailers have moved to the practice of taking up to 90 days to pay their suppliers. 90 DAYS! That's three months before you see the money of the product you sold through their channels. And they do this because they simply can.

I believe that there's not a single retailer that doesn't leverage its distribution advantage to squeeze their suppliers. If you're not Coca Cola, PepsiCo, Unilever, Procter and Gamble or Colgate Palmolive, you have little to no room for negotiation.

I've done consulting for small business distributing into major stories.

Other stores are very very UPFRONT on what they will do. Many make the small mfg sign an agreement that not only will the store have all the data, but the mfg will need to pay the STORE if they want the data.

The difference here is that a) it is all upfront and b) the mfg can make an informed decision - is this worth it.

If you need store / day detail on sales because you are running promos and in-store marketing vs just being a low cost volume seller - all affect your view of this.

Finally, in grocery retail - once you have the order and deliver, you DO get paid regardless of whether product sells. This is an important positive even selling through Target in some cases especially with more perishable goods. Amazon as a seller you can't plan as well - their alog or someone else paying for promo could cut your demand in half overnight.

Additionally retail stores actually drive demand / discover ability when they purchase your product in a way amazon often does not.

> Finally, in grocery retail - once you have the order and deliver, you DO get paid regardless of whether product sells.

It's been quite a long time since I worked in the grocery business, but I don't think this is accurate. A lot of vendors stock their products themselves or use food brokers that do it, and they are on the hook for expired and returned product. And there was a shitload of bribery and corruption happening to steal shelf space and end unit space from competitors. It's a surprisingly cut throat business.

> The difference here is that a) it is all upfront and b) the mfg can make an informed decision - is this worth it.

You sign the same deal when you sell on Amazon, probably even signing away more rights. I'm not sure I haven't read the full EULA when you sign up to sell.

> Amazon as a seller you can't plan as well - their alog or someone else paying for promo could cut your demand in half overnight.

This is about the only thing you've said I agree with. But it's not due to lack of data, it's due to barrier to entry with retail sales you have less competition. Right for the wrong reason here.

> Additionally retail stores actually drive demand / discover ability when they purchase your product in a way amazon often does not.

Amazon drives way WAY more discoverability than any retailer.

Pretty much your entire argument contradicts real world experience, common sense, and actual reality from what I know of the situation. I can tell you for a fact your assertion that 'Amazon doesn't do this' everything you're saying is 100% false.

Amazon drives way WAY more discoverability than any retailer.

This is completely false. Amazon provides significantly less discoverability than a retailer. With a retailer, you get a product that actually shows up in front of people's eyeballs, and the ability to provide in-store promotions to attract customers, and, most crucially, the store lets you know how the promotions perform. A small minority of retailers make you pay for this data, but most don't because they want products to sell through. Many stores will even work with new brands to promote their products, such as (temporary) eye-level product placement, end-of-aisle placement, special displays, etc.

Source: Before going in-house I used to rep manufacturers of all sizes from startups to billion-dollar behemoths selling to major, regional, and local retail chains. Grocery stores are the best at working with brands (but also the fastest to drop products that don't sell), Target is about average, and Walmart was the worst at the time though I hear they've gotten better.

As a non shlock product seller you are much more comfortable in local retail I think? I just thought retail was easier to actually talk to real people.

The schlock sellers I think are more expert in the amazon game (image / product swapouts and seller targeting, review spiking games, competitor flag and return / hazard attacks etc). So much BS and so little real recourse - the scale of marketplace must be nuts.

Tim - have you actually ever reped / managed distribution into retail at the moderate scale at least?

Do you have a reasonably high volume ($1M+ sales) amazon account to compare to?

I just ask because for such strong opinions "everything you're saying is 100% false" you don't seem like you have actually worked with businesses in this way.

Beleive it or not, you can actually talk to real human beings at your local retail stores. And yes, you can talk to real people at amazon, but if issue is outside their box (on seller side) you get little mercy. If inside box some of the treatment is amazing (amazon payments for goods they show as lost by them as a sale with no return risk)

Can you link to where AMZN has said this?

"Nate Sutton, associate general counsel at Amazon, told lawmakers the company doesn’t tap data from individual third-party merchants to determine what new products to create."

https://www.cnbc.com/2019/07/16/amazon-tells-house-it-doesnt...

Ah, the hyper-specific dementi? Doesn't tap data from _individual_ third-party merchants.

No specific merchants... It's just from the aggregate data from third-party merchants. And I bet that data is "anonymized" too.

And you would win that bet.

Paragraph two of the article

> The online retailing giant has long asserted, including to Congress, that when it makes and sells its own products, it doesn’t use information it collects from the site’s individual third-party sellers—data those sellers view as proprietary.

How would Amazon not use sales data of comparable products to evaluate the launch of a new white label product?

Amazon agrees that what is being reported goes against their policies.

'"However, we strictly prohibit our employees from using nonpublic, seller-specific data to determine which private label products to launch." Amazon said employees using such data to inform private-label decisions in the way the Journal described would violate its policies, and that the company has launched an internal investigation.'

That carefully phrased language could be technically accurate but still allow them to use seller-agnostic information about the market for batteries or speaker wire to decide to launch Amazon Basics batteries or speaker wire.

(Which by the way, I’m totally fine with, because there’s no reasonable way to prove you’re not doing it and any brick-and-mortar retailer is almost surely doing it as well.)

It's also ethically fair game to base your decisions to launch a product on the amount of consumer interest the category gets. Everyone does that.

What they promise not to do is take a look at seller specific data. That makes sense because it won't get them much extra compared to looking at categories, and the sellers ethically claim it's their data.

Actually - as the article described, they DO spend a lot of time looking at SPECIFIC seller data for unique products because it gives them LOTS extra that category details don't provide.

Could you please stop using allcaps like this? This is in the site guidelines: Please don't use uppercase for emphasis. If you want to emphasize a word or phrase, put asterisks around it and it will get italicized. https://news.ycombinator.com/newsguidelines.html.

> seller-specific data

Making decisions on the aggregate data doesn't violate this policy.

By breaking up Amazon.

This whole issue stinks of monopoly.

Amazon enticed sellers by promising them they would not do this. They literally testified before congress they would not do this.

My comment got voted to zero and negative initially - does HN not understand that lying DAMAGES even capitalistic economies and functioning markets?

"why not do this?" - because you promised you would not.

This is stuff we teach 6 year olds - but apparently the most rudimentary form of ethics is too much for amazon.

> This is totally false - the number of retailers who have testified before congress that they don't use seller data to compete against sellers - and then who go ahead and do just that is basically zero.

I can't understand this at all. Retailers create in-house brands all the time. Do they somehow make decisions of which products to create in a black box? How would they even do that?

If you go into the Walmart pharmacy, their store-brand equivalents are full of statements such as "Compare to the active ingredient in Advil".

Sellers at walmart

a) actually sell their product to walmart, even the branded product is owned, priced and managed by WALMART. So there is much less SELLER specific data to datamine.

b) sellers to walmart AGREE that the data on products priced, sold, and promoted by walmart (even branded one) belongs to walmart, and in many cases the seller has to pay extra if they want day/store level detail on sales. So in most cases it is a very upfront relationship, and walmart takes a lot more risk in pricing, promoting etc.

Here Amazon has enticed sellers by reassuring them that in CONTRAST to target, Amazon will NOT use the data they provide amazon to market against them AND sellers give amazon a lot more "seller" data because the sellers are often doing their own price management etc etc.

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