Report: Amazon used its seller data to launch private-label products.

Report: Amazon used its seller data to launch private-label products.

According to a report from The Wall Street Journal, Amazon staffs have obtained sales data from independent Marketplace sellers to help the organization create competitive private-label goods. Past Amazon workers and one current one informed the WSJ there was no clear implementation of rules that barred the practice. 

Furthermore, former Amazon staff claimed to utilize vendors’ sales data was “a standard practice that was debated openly in the meetings they attended,” the report states.

One former employee told the WSJ that they understood they violated the policies:

“We realized we shouldn’t,” said one former employee who obtained the data and identified a pattern of using it to launch Amazon goods to benefit themselves. “But at the same time, we are making Amazon labelled products, so we want them to sell.”Amazon denied allegations that the business utilized data from private sellers to further produce its goods, in a statement to The Verge. 

“We look at the sales and shop results like other retailers and give our consumers the greatest potential experience,” said Amazon. 

“Nevertheless, we explicitly forbid our staff from utilizing non-public, seller-specific data to decide which goods to introduce on private label. Although we don’t believe these reports are true, we take these allegations very seriously and have launched an internal investigation.”

Previously, Amazon has testified to Congress that it doesn’t carry any activity of collecting sales data to create its private brands.  “Our motive is to help the seller prosper, as we depend on them,” Nate Sutton, Associate General Counsel for Amazon, said at a hearing on July 16. “We have a lot of options. And we extend the same criteria to all of them and when we make decisions to launch private brands we don’t use their individual data.”

Amazon has been under scrutiny for some time over alleged anti-competitive activities, but the Federal Trade Commission has not yet initiated a formal inquiry into the corporation on the issue. The FTC also made tentative inquiries into Amazon’s deal with Apple to allow Apple to sell its products on the e-commerce portal. Marketplace sellers were also interviewed by FTC investigators on how many of their sales came from Amazon, Bloomberg reported last September. 

In February, the FTC was petitioned by a coalition of unions to investigate Amazon for anti-competitive activities involving their usage of marketplace data.

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Abhay Shah is a professional Digital Marketer and a Web Designer who is having more than 7 years of experience in the marketing field. Based on its knowledge, he tries to formulate the best information and keeps himself updated with the latest trends.

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