The company is working on a fix after Recode alerted it to the issue.
Amazon surprised millions of customers last weekend when it confirmed it had pushed back delivery of many nonessential items until late April so it could more urgently fulfill orders for essential items amid the online shopping frenzy caused by the Covid-19 coronavirus pandemic.
But Recode has learned it’s been possible to get some of these nonessential items much faster — it’s just that Amazon has hidden listings from competing sellers on its marketplace that promise to deliver these same products at earlier dates.
In categories ranging from sporting goods to office equipment, Amazon sellers have been offering some of these same items at the same or lower prices and with earlier delivery dates than Amazon has. But the Amazon algorithm that decides which seller wins a given product sale for a listing has favored items sold directly by Amazon — or by an Amazon seller storing the goods in Amazon’s warehouses — even when those offers are accompanied by much later delivery promises. In Amazon’s ecosystem, winning a sale of an item sold by multiple sellers is known as winning the “Buy Box.”
After Recode alerted Amazon to the issue, a company spokesperson said the hidden listings are unintentional and that the company is urgently working on a fix.
“To address the need for high-priority items and ensure customers are receiving deliveries as quickly as possible, we’ve made a number of adjustments to how our store works,” Amazon said in a statement. “In this case, some of these changes have resulted in an error which, in some cases, resulted in an unintended variation in how we select which offers to feature. We are working to correct it as quickly as possible.”
The hidden listing situation is an instance of Amazon operating in a way that would have been business as usual during normal times — with its algorithm favoring items stored in its warehouses because those are typically shipped and delivered faster than those from a seller’s warehouse — but now it’s happening during a global health crisis. This is causing negative impacts on sellers and customers at a time when people in many Western countries are relying on Amazon in an unprecedented way as they stay home to reduce the risk of contracting and spreading the novel coronavirus.
In other ways, Amazon has already drastically altered how it does business to respond to unique challenges the pandemic is creating. The company has banned nonessential goods from its warehouses through at least early April to try to prioritize stocking and shipping the most in-demand essentials. It’s also pushing to hire 100,000 new warehouse and delivery workers to handle front-line work as unemployment rates skyrocket, and the company has instituted weeks-long shipping delays for discretionary goods that would have been unheard of just one month ago.
By doing so, Amazon is responding to a crisis and getting people goods at a time when they need them the most — but some of its old mechanisms, such as its Buy Box algorithm, have been counterproductive and bad for sellers and customers alike.
“Part of the problem with Amazon,” one longtime Amazon seller told Recode, “is that this little thing that maybe no one at Amazon realizes is happening can wipe out people’s entire business.”
Amazon sellers who spoke to Recode pointed out listings for products ranging from printers to child safety locks where Amazon was highlighting its own item — or those of sellers using its Fulfillment by Amazon warehousing service — that had slower delivery speeds. Recode also found examples in categories like sporting goods where Amazon showcased a listing for a baseball glove that wouldn’t be delivered until April 23, rather than a listing from a seller (with a 97 percent positive seller rating) for the same item that was nearly $1 cheaper and would arrive between April 1 and 6.
Until Amazon updates its Buy Box algorithm, shoppers who want to search to see if there’s a cheaper and faster option on a listing need to look for a tiny text box that, in the baseball glove example, says “New & Used (8) from $19.01.” Clicking on that tab will take customers to a list of all available listings for the same product.
Hiding these product listings has only exacerbated for some sellers the fallout from other recent changes Amazon has made to its business. On one side, Amazon sellers who sell goods currently deemed nonessential during the pandemic — and who store them in Amazon warehouses — are losing money and experiencing delayed payments because, in some cases, Amazon is not shipping their customer orders until late April.
Amazon is also temporarily not allowing sellers to remove their inventory from Amazon warehouses because warehouse staff is so focused on getting high-demand products out the door. One other option sellers then have to keep sales going on Amazon is to ship items themselves. But Amazon hiding their product listings makes that harder, if not impossible, to do.
“They’re not letting me do withdrawals, not currently shipping outbound from their warehouse, and not letting me win the Buy Box” on items they ship themselves, another longtime seller told Recode. “I’m getting hit on all fronts.”
This seller said customers are still placing orders for some of his items that are stuck in Amazon’s warehouses, but he’s not yet generating any revenue from those sales because they are not shipping out as quickly as usual.
At a time when millions of people are relying on Amazon almost as they would on a government service, it has altered its operations in many ways to attempt to rise to the occasion. But the case of the hidden listings — which the company said it would rectify after Recode alerted the company of the issue — is a reminder that for a behemoth like Amazon, changes it makes can have serious unintended consequences that don’t even register on its radar.
Author: Jason Del Rey