Amazon ripped off its third-party sellers’ merchandise and rigged search results to favor its own merchandise — at the same time as Jeff Bezos informed Congress beneath oath that the corporate didn’t have interaction in such practices, in accordance to a brand new investigation.
The knockoff and manipulation marketing campaign occurred in Amazon’s India division with the approval of high-level executives based mostly within the US, Reuters reported on Wednesday.
Amazon workers tracked gross sales and search knowledge to determine “reference brands” that the corporate then replicated and offered, in accordance to a 2016 doc seen by the outlet.
The report provides credence to a declare that critics and a few third-party sellers have been making for years: Amazon makes use of the unprecedented amount of gross sales knowledge it gathers because the world’s high e-commerce website to assist determine which merchandise to make beneath its own labels like Amazon Basics.
But the corporate has lengthy denied such accusations. Speaking to Congress beneath oath final yr, founder Jeff Bezos stated the e-commerce big has a rule prohibiting its workers from utilizing knowledge on third-party sellers to assist its private-label enterprise.
“If we found someone violated it, we would take action,” stated Bezos, who was Amazon CEO on the time however has since stepped down.
But the interior paperwork seen by Reuters present that manipulating search results to favor Amazon’s own merchandise, in addition to copying different sellers’ items, had been a part of a proper, clandestine technique at Amazon’s India operation. The paperwork additionally reportedly present that two Amazon executives reviewed the India technique – senior vice presidents Diego Piacentini, who has since left the corporate, and Russell Grandinetti, who at the moment runs Amazon’s worldwide client enterprise.
In an announcement to The Post, an Amazon spokesperson denied the Reuters report.
“As Reuters hasn’t shared the documents or their provenance with us, we are unable to confirm the veracity or otherwise of the information and claims as stated,” the spokesperson stated. “We believe these claims are factually incorrect and unsubstantiated.”
The spokesperson didn’t reply to a query about whether or not the Reuters report exhibits Bezos misled Congress. The report didn’t say that Bezos was conscious of the India technique.
The revelations might give gasoline to antitrust regulators within the US, European Union and India, who’re all investigating the corporate for allegedly utilizing its dimension to squash competitors.
In the US, Federal Trade Commission chief Lina Khan wrote in a 2017 paper that Amazon’s private-brand enterprise raises competitors considerations.
“It is third-party sellers who bear the initial costs and uncertainties when introducing new products; by merely spotting them, Amazon gets to sell products only once their success has been tested,” she wrote. “The anticompetitive implications here seem clear.”
Amazon, for its half, has referred to as on Khan to recuse herself from any investigations of the corporate as a result of she has written critically about it up to now.