{"id":25922,"date":"2024-07-13T13:00:08","date_gmt":"2024-07-13T13:00:08","guid":{"rendered":"http:\/\/108005456"},"modified":"2024-07-13T13:00:08","modified_gmt":"2024-07-13T13:00:08","slug":"amazon-sellers-lose-coveted-buy-box-ahead-of-prime-day-after-target-discount-snafu","status":"publish","type":"post","link":"https:\/\/wp.worldtechguide.net\/amazon-sellers-lose-coveted-buy-box-ahead-of-prime-day-after-target-discount-snafu\/","title":{"rendered":"Amazon sellers lose coveted buy box ahead of Prime Day after Target discount snafu"},"content":{"rendered":"<p><span class=\"HighlightShare-hidden\"><\/span><\/p>\n<div class=\"InlineImage-imageEmbed\" id=\"ArticleBody-InlineImage-107314679\" data-test=\"InlineImage\">\n<div class=\"InlineImage-wrapper\">\n<div>\n<p>An Amazon driver delivers packages in Washington, D.C., on Aug. 27, 2023.<\/p>\n<p>Tom Williams | Cq-roll Call, Inc. | Getty Images<\/p>\n<\/div>\n<\/div>\n<\/div>\n<div class=\"group\">\n<p>When Brandon Fishman ran a discount on his vitamin-infused coffee for <span class=\"QuoteInBody-quoteNameContainer\" data-test=\"QuoteInBody\" id=\"RegularArticle-QuoteInBody-1\"><span class=\"waslinkname\">Target<\/span><span class=\"QuoteInBody-inlineButton\"><span class=\"AddToWatchlistButton-watchlistContainer\" id=\"-WatchlistDropdown\" data-analytics-id=\"-WatchlistDropdown\"><button class=\"AddToWatchlistButton-watchlistButton\" aria-label=\"Add To Watchlist\" data-testid=\"dropdown-btn\"><span class=\"AddToWatchlistButton-addWatchListFromTag\"><\/span><\/button><\/span><\/span><\/span>&#8216;s weeklong deals event, he wasn&#8217;t worried about how it would affect his business on <span class=\"QuoteInBody-quoteNameContainer\" data-test=\"QuoteInBody\" id=\"RegularArticle-QuoteInBody-2\"><span class=\"waslinkname\">Amazon<\/span><span class=\"QuoteInBody-inlineButton\"><span class=\"AddToWatchlistButton-watchlistContainer\" id=\"-WatchlistDropdown\" data-analytics-id=\"-WatchlistDropdown\"><button class=\"AddToWatchlistButton-watchlistButton\" aria-label=\"Add To Watchlist\" data-testid=\"dropdown-btn\"><span class=\"AddToWatchlistButton-addWatchListFromTag\"><\/span><\/button><\/span><\/span><\/span>. He certainly didn&#8217;t expect his sales there to &#8220;fall off a cliff.&#8221;<\/p>\n<p>Fishman was in for a rude surprise. During Target&#8217;s sales event this week, Amazon&#8217;s automated systems detected his bag of <span class=\"waslinkname\">VitaCup<\/span> coffee was available there for $13.43, about $1.50 cheaper than his listing on Amazon.com.<\/p>\n<p>One of Amazon&#8217;s key tenets is that it offers &#8220;the lowest prices across Earth&#8217;s largest selection.&#8221; It&#8217;s up to Amazon merchants to fulfill that promise, and those who sell their items for a lower price on a competing website risk losing perhaps the most valuable virtual real estate in e-commerce: the buy box. That&#8217;s the listing that pops up first when a visitor clicks on a particular product, and the one that gets purchased when a shopper taps &#8220;Add to Cart.&#8221;<\/p>\n<p>Even though Fishman is the owner of the VitaCup brand, he said he lost the buy box to a reseller of his coffee products.<\/p>\n<p>&#8220;I&#8217;ve had to purposely lose the buy box all week because of this Target issue, and my sales went way down on Amazon,&#8221; said Fishman, who has been selling VitaCup coffee on Amazon since 2017, pulling in roughly $20 million in annual sales on the site.<\/p>\n<\/div>\n<div role=\"region\" aria-labelledby=\"Placeholder-ArticleBody-Video-108003040\">\n<div role=\"button\" id=\"Placeholder-ArticleBody-Video-108003040\" class=\"PlaceHolder-wrapper\" data-vilynx-id=\"7000345115\" data-test=\"VideoPlaceHolder\">\n<div class=\"InlineVideo-videoEmbed\" id=\"InlineVideo-0\" data-test=\"InlineVideo\">\n<div class=\"InlineVideo-wrapper\">\n<div class=\"InlineVideo-inlineThumbnailContainer\"><img decoding=\"async\" class=\"InlineVideo-videoThumbnail\" src=\"https:\/\/wp.worldtechguide.net\/wp-content\/uploads\/2024\/07\/amazon-sellers-lose-coveted-buy-box-ahead-of-prime-day-after-target-discount-snafu.jpg\" alt=\"Target to stop accepting personal checks: Here's why\"><span class=\"InlineVideo-videoButton\"><\/span><span><\/span><\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<div class=\"group\">\n<p>Amazon has long relied on algorithms that continuously scan the internet to match or beat the price of products listed elsewhere. Other marketplaces, including <span class=\"QuoteInBody-quoteNameContainer\" data-test=\"QuoteInBody\" id=\"RegularArticle-QuoteInBody-4\"><span class=\"waslinkname\">Walmart<\/span><span class=\"QuoteInBody-inlineButton\"><span class=\"AddToWatchlistButton-watchlistContainer\" id=\"-WatchlistDropdown\" data-analytics-id=\"-WatchlistDropdown\"><button class=\"AddToWatchlistButton-watchlistButton\" aria-label=\"Add To Watchlist\" data-testid=\"dropdown-btn\"><span class=\"AddToWatchlistButton-addWatchListFromTag\"><\/span><\/button><\/span><\/span><\/span>, use similar systems in a bid to offer the cheapest prices.<\/p>\n<p>Amazon&#8217;s algorithms have attracted scrutiny from lawmakers and regulators who claim the system is anti-competitive. The practice is <span class=\"waslinkname\">at the center of a lawsuit<\/span> filed in September by the Federal Trade Commission that accuses Amazon of using an &#8220;anti-discounting strategy&#8221; and a &#8220;massive web-crawling apparatus that constantly tracks online prices&#8221; to stifle competition.<\/p>\n<p>The company has rejected the FTC&#8217;s claims, and said the pricing tool is part of running a good business.<\/p>\n<p>&#8220;Just like any store owner who wouldn&#8217;t want to promote a bad deal to their customers, we don&#8217;t highlight or promote offers that are not competitively priced,&#8221; David Zapolsky, Amazon&#8217;s general counsel, wrote <span class=\"waslinkname\">in a blog post<\/span> after the lawsuit was filed. Amazon <span class=\"waslinkname\">has also said<\/span> third-party sellers set their own prices.<\/p>\n<p>An Amazon spokesperson declined to comment on the concerns raised by sellers.<\/p>\n<\/div>\n<h2 class=\"ArticleBody-subtitle\">The importance of the buy box<\/h2>\n<div class=\"group\">\n<p>Amazon launched Prime Day in 2015 as a way to attract new members to its currently $139-a-year subscription program, while also showcasing its own products, notably its electronic devices, and other services. The promotional event has turned into a big revenue driver for other retailers, which often hold competing sales timed around Prime Day.<\/p>\n<p>Analysts at JPMorgan forecast total revenue for Prime Day, which is <span class=\"waslinkname\">set to kick off<\/span> on Tuesday, will reach $7.9 billion this year, up 11% from 2023, according to a note to clients on Friday.<\/p>\n<p>Target began running discounts across its site on July 7, as part of its Circle Week promotional event. Circle Week is typically held in the lead-up to Amazon&#8217;s bargain bonanza.<\/p>\n<p>The problem for Fishman and other sellers resulted from a change in how Target promoted deals for Circle Week. In the past, the company would would show the percentage discount off the regular price to avoid tipping off Amazon&#8217;s pricing algorithms, Fishman said.<\/p>\n<p>But this year, instead of listing his item as 25% off, Target showed the item&#8217;s actual sale price. That meant it was indexed by Amazon&#8217;s pricing algorithms, Fishman said, causing him to lose the buy box.<\/p>\n<\/div>\n<div class=\"InlineImage-imageEmbed\" id=\"ArticleBody-InlineImage-107407619\" data-test=\"InlineImage\">\n<div class=\"InlineImage-wrapper\">\n<div>\n<p>An Amazon Rivian electric delivery van on Interstate 87 near Harriman, New York, US, on Thursday, April 11, 2024.<\/p>\n<p>Angus Mordant | Bloomberg | Getty Images<\/p>\n<\/div>\n<\/div>\n<\/div>\n<div class=\"group\">\n<p>Winning the buy box is paramount to a seller&#8217;s success on Amazon. Without it, shoppers can still find a seller&#8217;s product, but they have to take the extra step of clicking into a separate window, where all the offers available are listed. Nearly 98% of sales made on Amazon go through the buy box button, the FTC alleged in its suit.<\/p>\n<p>Mason Arnold&#8217;s experience last week was similar to Fishman&#8217;s.<\/p>\n<p>Arnold said that after Target launched Circle Week, sales of his <span class=\"waslinkname\">Sunwink<\/span> herbal tonics and powders started plummeting on Amazon because he lost the buy box to resellers.<\/p>\n<p>&#8220;The only way to get back the Amazon buy box is to lower our price on Amazon,&#8221; Arnold said.<\/p>\n<p>Sunwink did just that, cutting the price of one of its products to $19 from $23. Sales have since started to pick up, but Arnold is doubtful he&#8217;ll be able to make a profit at that level. Amazon retail is already a low-margin business due to pricing competition and all the fees for fulfillment, <span class=\"waslinkname\">advertising<\/span> and other services.<\/p>\n<p>&#8220;We lowered our prices so we&#8217;re currently losing money until it gets fixed,&#8221; Arnold said. &#8220;We don&#8217;t know what the total is going to be, but for us at a minimum it&#8217;s hundreds of thousands of dollars&#8221; in losses, he said.<\/p>\n<p>Arnold said some resellers buy his products from offline discount retailers and sell them at a markup on Amazon, forcing him to compete selling his own brand.<\/p>\n<p>Fishman said that he and other sellers in his network took their concerns to Target. The company then adjusted the Circle Week discounts on some listings to say, &#8220;See price in cart,&#8221; meaning shoppers would have to add the product to their cart in order to see the price, Fishman said. The change skirted Amazon&#8217;s pricing algorithms, he added.<\/p>\n<p>Target disputed the claim and declined to comment further.<\/p>\n<p>Third-party sellers like Arnold and Fishman are the heartbeat of Amazon&#8217;s dominant e-commerce business. Since about 2017, they&#8217;ve accounted for at least half of all goods sold on the site. In the first quarter of this year, that number swelled to 61%.<\/p>\n<p>Still, Fishman says the company is quick to penalize sellers, who are just trying to make a living. In so doing, the company is stifling competition, he says.<\/p>\n<p>&#8220;Their whole point is we always want to have the lowest price,&#8221; Fishman said. &#8220;Well, me as a brand, if I want to have a sale on Target for a week, I should be allowed to. I shouldn&#8217;t have to be on sale everywhere.&#8221;<\/p>\n<\/div>\n<div class=\"group\">\n<div class=\"RelatedContent-relatedContent\" id=\"RegularArticle-RelatedContent-1\">\n<div class=\"RelatedContent-container\">\n<div class=\"RelatedContent-nonCollapsibleContent\">\n<h2 class=\"RelatedContent-header\">Don\u2019t miss these insights from CNBC PRO<\/h2>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<div role=\"region\" aria-labelledby=\"Placeholder-ArticleBody-Video-108005505\">\n<div role=\"button\" id=\"Placeholder-ArticleBody-Video-108005505\" class=\"PlaceHolder-wrapper\" data-vilynx-id=\"7000345620\" data-test=\"VideoPlaceHolder\">\n<div class=\"InlineVideo-videoEmbed\" id=\"InlineVideo-0\" data-test=\"InlineVideo\">\n<div class=\"InlineVideo-wrapper\">\n<div class=\"InlineVideo-inlineThumbnailContainer\"><img decoding=\"async\" class=\"InlineVideo-videoThumbnail\" src=\"https:\/\/wp.worldtechguide.net\/wp-content\/uploads\/2024\/07\/amazon-sellers-lose-coveted-buy-box-ahead-of-prime-day-after-target-discount-snafu-1.jpg\" alt=\"Amazon is playing catch up when it comes to AI, says Roth MKM's Kulkarni\"><span class=\"InlineVideo-videoButton\"><\/span><span><\/span><\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>An Amazon driver delivers packages in Washington, D.C., on Aug. 27, 2023. Tom Williams | Cq-roll Call, Inc. | Getty Images When Brandon Fishman ran a discount on his vitamin-infused coffee for Target&#8216;s weeklong deals event, he wasn&#8217;t worried about how it would affect his business on Amazon. He certainly didn&#8217;t expect his sales there &hellip;<\/p>\n","protected":false},"author":1,"featured_media":25923,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[8],"tags":[],"hashtags":[],"class_list":["post-25922","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-tech","has-thumb","has-featured"],"_links":{"self":[{"href":"https:\/\/wp.worldtechguide.net\/wp-json\/wp\/v2\/posts\/25922"}],"collection":[{"href":"https:\/\/wp.worldtechguide.net\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/wp.worldtechguide.net\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/wp.worldtechguide.net\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/wp.worldtechguide.net\/wp-json\/wp\/v2\/comments?post=25922"}],"version-history":[{"count":0,"href":"https:\/\/wp.worldtechguide.net\/wp-json\/wp\/v2\/posts\/25922\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/wp.worldtechguide.net\/wp-json\/wp\/v2\/media\/25923"}],"wp:attachment":[{"href":"https:\/\/wp.worldtechguide.net\/wp-json\/wp\/v2\/media?parent=25922"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/wp.worldtechguide.net\/wp-json\/wp\/v2\/categories?post=25922"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/wp.worldtechguide.net\/wp-json\/wp\/v2\/tags?post=25922"},{"taxonomy":"hashtags","embeddable":true,"href":"https:\/\/wp.worldtechguide.net\/wp-json\/wp\/v2\/hashtags?post=25922"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}