As a consumer it’s hard to imagine a better online shopping experience than you get with Amazon. The company does an outstanding job selling and delivering products, while also promoting items that are shipped to you by other retailers.
I’ve always found transactions on Amazon to be fast and trouble-free, and I’ve been satisfied with their customer service for as long as I can remember.
However, because of their market power – and some behaviors that I feel are outright irresponsible – I think that you should approach Amazon with great suspicion when it comes to your online business.
Fierce Competitor
Let’s face it: many consumers would be happy to buy a slightly inferior or more expensive product from Amazon than a comparable product from your website. Amazon makes it so easy to buy and return items – and there’s so much trust in their store – that the risk is practically zero.
This is the natural and deserved advantage that Amazon gets from its good customer service. But it also means that you should think twice about starting an online store if Amazon sells even somewhat competitive items.
Our Mistake
Knowing that customers feel comfortable with items they find on Amazon, we signed up for their Seller Central program to display our ads whenever Amazon visitors searched for items like ours. People who clicked the ads were taken to our website, where they found detailed information and accurate shipping rates quoted in real-time by UPS and others.
Shocked, then Angry
Soon after joining the program we found ads appearing on websites all over the Internet, offering bogus discounts and nonexistent free shipping on our products. It turns out that the ads are published by Amazon affiliates, who Amazon pays a commission to bring buyers to its website regardless of the products sold.
So many affiliate websites offer bogus discounts on our products that people who search for our company name on Google often click the results that show enticing fake offers. We know because frustrated shoppers contact our customer service staff, demanding that we make good on the bogus ads.
Next, the affiliates began running large ads above Google’s search results, showing our company name and the bogus offers.
Feeling confident that Amazon would handle the issue fairly, we contacted the company to ask that they stop the affiliates’ ads that offer fake discounts on our products. Amazon’s reply was a real surprise.
It Gets Much Worse
Instead of putting a stop to fake offers published by its affiliates, the email reply from Amazon seems to blame our company with the odd pretext that our website, like many stores, offers our customers accurate shipping rates calculated in real time by UPS and others.
We concluded that Amazon makes a thin excuse for paying its affiliates to act irresponsibly. Not wanting to reward that behavior, we stopped our Amazon Seller Central ads.
And then things got really ugly.
The affiliate ads with bogus offers on our products continued after we stopped advertising with Amazon, of course. But now when you search for our product name and click the big ads with the fake offers, you’re taken to Amazon’s web page that displays our product images and names, with the misleading message that they are all “Currently unavailable” and a list of cheap alternatives you can buy from Amazon.
Lesson Learned
Early-on another business owner told us that fulfilling products through Amazon can be a big mistake, too, since Amazon has a reputation for using the data they collect to seek out and replace successful products with their own, aggressively undercutting the original sellers on price.
We could have saved a great deal of time, money and frustration if we’d only heeded those early warnings about doing business with Amazon.
Thank goodness our company’s products have positive word of mouth. It seems certain that Amazon harms our business, but more and more customers still find our products without being lured away by bogus ads.