AMAZON IS TOO PERVASIVE, ANTI-COMPETITIVE.
Determining when a company becomes so powerful that it hinders competition is one of the toughest tasks in capitalism.
Tens of millions of Americans love the convenience of ordering from Amazon.com. But the company is also much more significant than most people know, dominating every facet of ecommerce as it tries to sell everything a consumer may want.
Digital retailing tools are highly effective, decimating brick-andmortar stores. But Amazon’s strategy goes much further, gathering in-depth customer data and providing the computing backbone for online sellers. Amazon’s domination of online retail has gone too far.
Amazon started out selling books, but today almost any item legally for sale anywhere in the world is available. The selection of switchblades is impressive, and you can get next-day delivery with Amazon Prime membership.
The company, which briefly hit a $1 trillion valuation, has moved beyond merely selling items, but rents website space to other retailers, provides cloud computing services, operates warehouses, delivers good for others and sells advertising, which now includes sending free samples to loyal customers. But beware, because if you do a great job selling a product on Amazon.com, Amazon will hire a company to start making that same time and will begin competing with you by offering impossibly low prices.
To put this in old-fashioned terms, Amazon owns the mall, rents space to retailers, controls access to customers, collects data on every sale while also operating the largest store in the mall. And if one of the smaller retailers show some success, Amazon will compete with them.
Yet that is not enough for CEO Jeff Bezos, because 90 percent of retail sales still take place in brick-and-mortar buildings. Amazon has bought grocery giant Whole Foods, launched Amazon Go convenience stores and opened Amazon kiosks in shopping malls. The company is reportedly looking at old Sears stores to add more retail and warehouse space.
Most disturbing, though, is Amazon’s decision to establish 135 private-label products to compete directly with third-party retailers on the Amazon website.