Amazon recently announced the price alert and made changes in the selling system. The condition is that if the sellers do not increase the price according to the rules set by Amazon, then they might lose perks. Because of this, other third-party sellers such as Walmart has to make changes to match the norms set by Amazon. Although the price alert might sound anti-competitive, it has become the talk of the town. It is also serving as a central piece of evidence in the federal government where there is an investigation going on in the tech companies of the USA.
Amazon has not made the decision in open but somehow it has managed to convey its message to the sellers. In some cases, it has been seen that the brand is asking the sellers to decrease the price for some of its items. In similar manners as Amazon, Walmart is asking its sellers to match the prices but it couldn’t be as influential as Amazon.
One of the alert messages sent to sellers that price products differently on Amazon and Walmart reads “One or more of your offers is currently ineligible for being a featured offer on the product detail page because those items are priced higher on Amazon than at other retailers”. Because of such pricing policies and scales, Amazon has become a platform that one cannot go without.
The hiking has not changed the product’s prices but also affected other platforms. Companies who want to advertise using amazon’s platforms now have to pay more prices than before. Also, Amazon is not going to lower the prices in any way, leading sellers to raise their prices on other platforms to compensate for the loss.
How The FTC scrutinizes this action on the part of Amazon?
Earlier, the brand had a policy according to which it made the prices equal on marketplace platforms. Sadly, it diminished the policy 6 years ago in the EU. Also, it detached itself from the sellers in the USA in the month of May 2019. This influenced the sellers to increase prices rather than lowering it. The step taken by Amazon has given a reason to the Federal Trade Commission to seriously scrutinize it. The scrutinizers have started to ask questions the Amazon Marketplace sellers about a deal which they struck with Apple in the year 2018.
On this, a spokesperson from the side of amazon said, “Amazon works hard to keep prices low for both customers and sellers. We have very competitive fees for sellers and we make significant investments on their behalf to continually improve our store and empower their businesses”. But sellers are not happy by selling their products on Amazon because they are not able to make enough money and it is leading them to losses.
Smith Julian is a Microsoft Office expert and has been working in the technical industry since 2002. As a technical expert, he has written technical blogs, manuals, white papers, and reviews for many websites such as McAfee.com/Activate.