Amazon

Why was My Review Rejected or Removed?

24 September 2016

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Link to the rest at Amazon Customer Review Creation Guidelines

Just How Many Stores Must Retailers Close to Beat Amazon?

23 September 2016

From The Motley Fool:

Are there enough stores for retailers to close to offset the impact of Amazon.com?

Macy’s announced last month it identified 100 stores it will close in a bid to offset six straight quarters of declining comparable store sales. The reduction equates to 12% of its store base and exceeds the combined number of store closings the retailer has initiated over the last six years.

Where some companies like Sears Holdings probably don’t even have enough stores in its portfolio to close to offset the damage being done, others don’t seem to fully appreciate the threat they face and aren’t doing enough to sufficiently offset the Amazon effect.

. . . .

Retail remains “overstored” with too many locations that can’t support declining customer traffic. According to data compiled by the industry watchers at ShopperTrak, retail store foot traffic has plunged 57% between 2010 and 2015, and shoppers are checking their mobile devices before making a purchase.

Some in the industry seemingly don’t want to accept the notion that many of their stores aren’t needed. Instead of closing locations, they’re just reducing their size.

. . . .

But there is a dramatic reduction coming in the number of stores that will be open.

  • Office Depot has closed 400 stores as of the end of its second quarter and will be closing 300 more over the next three years.
  • American Eagle Outfitters will close 154 stores through 2017.
  • Barnes & Noble is closing 10 stores this year and 223 stores by 2024.
  • Chico’s FAS will close 120 stores thru 2017.
  • Children’s Place will close 200 stores by 2017.
  • Gap is closing 35 stores this year.

. . . .

Malls are not the draw they once were and department stores have lost their ability to attract customers. Real estate research firm CoStar reports annual department store retail sales have tumbled 28% since their peak in 1999, and revenues have slid every single year except one to end 2015 at $165.5 billion.

All the while Amazon.com is getting stronger, recently reporting its third consecutive quarter of record profits by generating $857 million in earnings on sales of $30.4 billion.

Link to the rest at The Motley Fool

Amazon Says It Puts Customers First. But Its Pricing Algorithm Doesn’t.

21 September 2016

From Pro Publica:

One day recently, we visited Amazon’s website in search of the best deal on Loctite super glue, the essential home repair tool for fixing everything from broken eyeglass frames to shattered ceramics.

In an instant, Amazon’s software sifted through dozens of combinations of price and shipping, some of which were cheaper than what one might find at a local store. TheHardwareCity.com, an online retailer from Farmers Branch, Texas, with a 95 percent customer satisfaction rating, was selling Loctite for $6.75 with free shipping. Fat Boy Tools of Massillon, Ohio, a competitor with a similar customer rating was nearly as cheap: $7.27 with free shipping.

The computer program brushed aside those offers, instead selecting the vial of glue sold by Amazon itself for slightly more, $7.80. This seemed like a plausible choice until another click of the mouse revealed shipping costs of $6.51. That brought the total cost, before taxes, to $14.31, or nearly double the price Amazon had listed on the initial page.

What kind of sophisticated shopping algorithm steers customers to a product that costs so much more than seemingly comparable alternatives?

One that substantially favors Amazon and sellers it charges for services, an examination by ProPublica found.

. . . .

Unseen and almost wholly unregulated, algorithms play an increasingly important role in broad swaths of American life. They figure in decisions large and small, from whether a person qualifies for a mortgage to the sentence someone convicted of a crime might serve. The weightings and variables that underlie these equations are often closely guarded secrets known only to people at the companies that design and use them.

But while the math is hidden from public view, the effects of algorithms can be vast. With more than 300 million active customer accounts and more than $100 billion in annual revenue, Amazon is a shopping giant whose algorithm can make or break other retailers. And so ProPublica set out to see how Amazon’s software was shaping the marketplace.

We looked at 250 frequently purchased products over several weeks to see which ones were selected for the most prominent placement on Amazon’s virtual shelves — the so-called “buy box” that pops up first as a suggested purchase. About three-quarters of the time, Amazon placed its own products and those of companies that pay for its services in that position even when there were substantially cheaper offers available from others.

. . . .

Erik Fairleigh, a spokesman for Amazon, said the algorithm that selects which product goes into the “buy box” accounts for a range of factors beyond price. “Customers trust Amazon to have great prices, but that’s not all— vast selection, world-class customer service and fast, free delivery are critically important,” he said in an e-mailed statement. “These components, and more, determine our product listings.”

. . . .

The decision to allow non-Amazon companies to sell products on the site was controversial within the company. But Bezos pushed ahead, saying he was willing to lose sales if it made his company more competitive in the long run. “If we side with the consumer on that kind of decision,” he said at the 2007 annual shareholder meeting, “over time it will force the right kind of behaviors on ourself.”

At that meeting, a shareholder asked about Amazon’s practice of promoting products sold by other companies on its website. Bezos replied that the company had “very objective customer-centered algorithms‘’ that automatically award the “buy box” to the lowest price seller, provided “they actually have it in stock and can deliver it.”

It is not clear why Amazon’s algorithm now pushes its own products ahead of better deals offered by others. Perhaps Amazon is taking the view that its widely admired shipping and delivery offers the best possible satisfaction for customers, even if it costs more.

. . . .

Consider BareBones WorkWear, a Sacramento clothing retailer that has been selling on Amazon since 2004. This year, the company removed nearly all of its items from Amazon, and shuttered a warehouse and call center that were devoted to Amazon sales.

“Competition between us and Amazon is just insurmountable,” BareBones chief operating officer Mason Moore said. The profit margins for most clothing items were too low, he said, to allow for the company to sell through the Fulfilled by Amazon, or FBA, program. But, he said, “FBA is really the only avenue that we see as any feasible way to do business with Amazon.” This week, BareBones has just five items listed on Amazon — all of them fulfilled by Amazon.

Last Christmas, so many vendors joined Fulfilled by Amazon that the company ran out of space in some of its warehouses. This year, the company has doubled its number of warehouses.

. . . .

Tech companies’ practice of favoring their own listings has occasionally earned regulators’ scrutiny. The European Commission, for example, has accused Google of violating EU antitrust rules by favoring its own shopping service over those of other vendors.

Link to the rest at Pro Publica

PG says that’s just what ecommerce needs – government regulation of computer algorithms. No-hassle returns, high-quality packaging, package tracking and highly-predictable shipping are several. On more than one occasion, PG has regretted not paying a bit more for Amazon quality when he waited 2-3 weeks to receive a product from an independent seller who sent it in a chewed-up envelope.

 

 

A sure sign Amazon wants a D.C. store: It plans to finally collect sales taxes

21 September 2016

From The Washington Post:

Amazon shoppers in D.C. and 22 states currently make their purchases without having sales taxes collected — a major point of contention for traditional retailers who consider the arrangement unfair.

Shortly the playing field will be evened in the District however as representatives for the online seller informed the D.C. tax office in recent weeks that it would begin collecting the 5.75 percent sales tax on purchases shipped to the District.

. . . .

Company spokespeople repeatedly declined to respond when asked to elaborate, but Amazon is in search of locations to open brick-and-mortar stores in D.C. and opening one would trigger a law requiring that it collect taxes for online sales as well.

. . . .

“If Amazon opens a store they will be subject to District tax law, including the requirements regarding collection and remittance of sales tax, the same as any other retailer in the District,” said David Umansky, spokesman for D.C. Chief Financial Officer Jeffrey S. DeWitt  “In addition, if Amazon opens a store in the District sales taxes would be applicable to all Amazon products delivered to the District. Vendors on Amazon selling products delivered in the District will be subject to the taxes applicable to them.”

. . . .

Amazon already has three brick-and-mortar book stores, in Seattle, San Diego and Portland. It is hiring for a location outside of Boston. And it has enlisted the brokerage firm KLNB to scout places to open in D.C.

Link to the rest at The Washington Post and thanks to Dave for the tip.

Amazon Opening Another Bookstore in Massachusetts

19 September 2016

From Shelf Awareness:

After opening stores in Seattle, Wash., and San Diego, Calif., Amazon has confirmed that it will open two more stores, near Portland, Ore., and in Chicago, Ill., in the near future. Now we’ve seen ads for booksellers to staff a future Amazon Books location in Legacy Place, an outdoor shopping center in Dedham, Mass., in the suburbs southwest of Boston.

Link to the rest at Shelf Awareness

PG hasn’t read anything about how much Amazon pays its bookstore employees compared to the pay at locally-owned bookshops.

Amazon has cornered the future of book publishing

15 September 2016

From Quartz:

As traditional publishers struggle with sales, Amazon is quietly cornering a powerful new trend in books.

A recent report (pdf) from Bowker, the US company that issues International Standard Book Numbers (ISBN), shows that self-publishing is growing rapidly. Between 2010 and 2015, the number of ISBNs from self-published books grew by 375%. From 2014 and 2015 alone, the number grew by 21%. And perfectly positioned to take advantage of the growth is Amazon, whose DIY print business CreateSpace has become far and away the biggest self-publishing platform in the United States.

. . . .

Amazon’s dominance in self-publishing is probably even greater than Bowker shows. The e-commerce giant’s Kindle Direct Publishing platform lets authors publish ebooks without ISBNs, which means a big chunk of data is not captured by the report.

 Self-publishing is getting bigger and bigger. By some accounts, self-published authors are overtaking the big five publishing houses, at least when it comes to ebooks.

Link to the rest at Quartz and thanks to Dave for the tip.

Amazon Books opens in San Diego

15 September 2016

From The San Diego Union-Tribune:

Amazon Books, the e-commerce giant’s seemingly incongruous brick-and-mortar venture, is now open at Westfield UTC mall in University City. The bookstore marks the company’s second formal foray into offline retail.

The San Diego shop premiered with little fanfare on Sept. 7, and is now open daily during regular mall hours. The 3,500 square-foot venue is located in the Sears wing of the upscale mall, next to the Tesla store and across from the Apple store.

The opening comes just 10 months after the first Amazon Books store debuted at University Village, a Seattle-area outdoor mall.

. . . .

The physical stores reinforce Amazon’s original mission as an online bookseller, said Miro Copic, marketing professor at San Diego State University.

Though smaller than the Seattle store, San Diego’s Amazon Books location is similar in style and function, featuring a distinctive exterior brick wall, as well as an interior crafted not only to sell a curated selection books, but also to heavily promote Amazon’s Prime subscription service and its electronic devices.

“We’re giving customers an additional way to discover books and devices they’ll love by integrating the benefits of offline and online shopping in a physical store,” company spokesperson Deborah Bass said of Amazon’s strategy.

Amazon Books shoppers will find a limited number of titles (roughly 3,500 books in total), with books picked based on a variety of truly Amazonian factors such as online customer reviews and sales data.

. . . .

Despite its name, the venue isn’t really a bookstore — at least not in the familiar sense. Here, books act as a vehicle to drive consumers deeper into the Amazon system, Copic said. Books, he said, are small but browsable, don’t have a shelf-life and, more importantly, can act as conversation starters with staffers, who can then teach customers about the benefits of Prime membership.

In fact, Prime, the company’s $99-per-year membership service that includes two-day shipping and streaming video, factors heavily into the store experience. Staffers and in-store signage remind patrons at every turn that Prime members often pay less than retail prices for books, a point that is reinforced with each smartphone price check.

“Amazon is making sure that it gets as broad a way possible to distribute the (overall) Amazon store to the consumer,” Copic said. “They want to use this as a showpiece location; to showcase new products and technologies, and real cutting-edge products that might not be their own.”

Link to the rest at San Diego Union-Tribune and thanks to Dave for the tip.

How Amazon And Apple Show That High Profits Stop Companies From Dreaming Big

15 September 2016

From Forbes blogs:

When Amazon first introduced its own tablet, it seemed like just another me-too entrant into a hot category that Apple had pioneered. Five years later (last Saturday), Amazon.com launched a new model that takes its low-price obsession to the extreme. The latest Fire HD 8 comes with 12 hours of battery life and 200 GB of storage. Not only does it include rear and front cameras, but it also comes equipped with Alexa—the voice-controlled helper that answers questions, plays music on command, orders pizzas, and does much more. The price? A jaw-dropping $89.99 compared to Apple’s 8-inch iPads, which start at $399. So, while the overall tablet market has seen some sharp declines in recent quarters, Amazon tablet sales have surged 5,421% in 2016.

. . . .

Every respectable business school teaches at least one thing to aspiring MBAs: Prioritize investments on innovations that promise the highest returns. That is why, in each company, a watchful financial controller assesses investment opportunities and carefully allocates corporate resources. In an ideal scenario, the company sees its operating margins increase steadily with the launch of more profitable products over time. Apple is the poster child for this. The company’s stellar margins of nearly 40%, more than double Samsung’s 16.3%, have charmed investors.

. . . .

But no company operates in a vacuum. Apple’s real trouble lies in its high profitability; it has competitors which are only too happy to live on lower margins.

. . . .

A favorite maxim of Amazon’s Jeff Bezos is “Your margin is my opportunity.” Amazon built its empire selling books, CDs, and DVDs. Next came video streaming, then the Kindle, then the audiobook company, Audible. At every turn, Amazon forewent profitability. Instead, it “trained” investors to accept razor-thin margins. Adopting such a strategy, however, would also have impacts outside Amazon. It has created a precarious situation for a well-run, highly profitable firm such as Apple, whose sheer profitability severely limits what it can pursue now. And Apple is far from being an exception.

Link to the rest at Forbes blogs

Echo Dot Price Cut

14 September 2016

Amazon has announced a new Echo Dot at $49.99. The original Dot cost $89.99.

The Dot is a shorter version of the Echo (currently $179.99) that lets you talk to Alexa, a smart assistant like Siri, but more intelligent and with many more talents.

PG bought the original Echo and the original Dot when they were first released mostly because he’s a sucker for gadgets. Both do the same things, but the Echo has a better speaker for music.

Unlike many of his other gadget purchases, PG uses both every day (one is located downstairs at Casa PG and the other is located upstairs so PG can bellow commands from many parts of the house).

PG’s most common uses for Alexa are:

  1. To ask Alexa many random questions.
  2. To start, change and stop various music around the house. Alexa works with Prime Music plus Spotify, Pandora and other music services. Both the Echo and the Dot have internal speakers, but they also pair with external bluetooth speakers. The Dot can also connect with a standard stereo cable. Sonos has announced Alexa will be able to play through their excellent speakers within the next few months.
  3. To set various kitchen timers when PG’s hands are involved in cooking tasks. “Alexa, set a timer for 15 minutes” is easier than rinsing off his hands, then looking for a timer and setting it. Alexa can also tell you how much time is left on a timer.
  4. To turn lights on and off all over the house with smartplugs or smart switches.
  5. To add an item to a shopping list or a to-do list. Later, Alexa can read back all the items on any list. You can also see the lists on your smartphone.
  6. Adjust the thermostat at Casa PG.
  7. Check current weather conditions and the weather forecast
  8. Tell Alexa read you just about anything on Audible or Kindle Unlimited and to stop reading in so many minutes. Ditto for turning off music after a specified time interval.

Each thing that Alexa can do is called a skill and there are zillions of skills, most created by independent developers. Google “Alexa skills” to get an idea of the scope of AlexaWorld.

If PG were starting with the Echo ecosystem today, he would probably buy all Dots. The larger Echo is perfectly fine and sounds good for a small speaker, but using the Echo purchase price to buy more Dots would mean fewer Alexa deadspots in his home and he can listen to music on external speakers that are connected to/paired with a Dot. Dots are also smaller and less visually obtrusive than the Echo.

It’s not so much that you can’t do most or all of the tasks with your computer or smart phone but, for PG, telling Alexa to do something while he’s typing or reading doesn’t take him away from his task the way that using other devices does.

You can pre-order the new Echo Dot for delivery on October 20 when it’s released.

 

Pricing system offers scant protection as Amazon Japan hacks away at bookstores’ benefits

14 September 2016

From The Japan Times:

Until the early 1990s, when the asset-inflated bubble era ended, Japanese consumer prices were commonly thought to be substantially higher than those in other developed countries. Thanks to more than two decades of deflation, that’s no longer the case, but one sector has remained dear: publishing.

Books, newspapers and magazines are still relatively expensive thanks to the government-imposed resale price maintenance system, generally referred to in its abbreviated form, saihan seido. According to this system, all prices for publications (including CDs) are fixed for as long as they exist in the marketplace. Retailers cannot charge less for an item under any circumstances, no matter how long it remains in stock — no cutouts, no remainders, no bargain sales.

The ostensible purpose of saihan seido is to eliminate competition that could drive out smaller publishers, a situation that would threaten the public’s right to information. Regardless of the validity of this theory, it was actually the internet’s impact on news distribution, not to mention the growth of media conglomerates, that destroyed smaller publishers and regional newspapers in the U.S., where there is no price maintenance.

For sure, saihan seido has guaranteed the survival of a variety of publishing-related entities in Japan, even as sales of books and periodicals decrease. Newspaper delivery agents’ entire existence hangs on printed matter, and without guaranteed prices they would go out of business overnight. As a result, circulation would drop and periodicals could no longer charge high advertising rates.

But what has been the trade-off? Freelance journalist Tetsuo Jinbo is the most vocal critic of saihan seido. He says that along with the press club system and the cross-platform nature of Japan’s media industry, saihan seido prevents mainstream newspapers from thoroughly interrogating the authorities. He claims the mass media feel beholden to the government, because without seihan seido it would be every newspaper and magazine for itself.

That’s also why the media has never liked Amazon, whose online retail system allows it to flout saihan seido. Amazon has to sell Japanese books at their cover prices, just as bookstores do, but Amazon Marketplace offers an outlet for thousands of independent book vendors who sell supposedly used books at bargain prices. The national chain Bookoff does the same thing and the publishing industry tolerates it. Amazon is more of a concern since it is right there on your PC or smartphone, and Marketplace editions are sold alongside new editions and Kindle electronic books on the Amazon site, thus providing instant comparison shopping.

. . . .

Until Kindle editions became available, the main advantage bookstores had over Amazon was the option of browsing. Theoretically, readers could go to a bookstore to browse and then return home and order the book they found online, but in that situation the only cost advantage to consumers would be if they bought a used copy on Marketplace. It made no sense to buy the book online at the same price they could have paid in the store earlier. However, Amazon offers points for purchases of almost everything, including books, which effectively means the buyer receives a discount for anything sold on the site. So far, the government hasn’t seen this practice as a violation of seihan seido.

The clearer advantage of Amazon is that it offers books that aren’t browsable in bookstores. Before online shopping, if you wanted a book and your local bookstore didn’t stock it, you’d have to order it sight unseen and pay for it. Then you’d wait up to two weeks to receive it. Amazon carries everything, and delivers the book you want straight to your door.

Kindle made the situation for bookstores even worse, since Amazon offers free samples — usually a chapter or a few pages — of Kindle editions.

. . . .

Now, it could be argued that there’s no need to go to a bookstore at all. Initially, some publishers withheld their books from Amazon, but the online retailer is just too big to ignore, so the only way they can confound online browsing is by refusing to license their books for Kindle editions.

Link to the rest at The Japan Times and thanks to Felix for the tip.

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