It is reported that Amazon has suffered new setbacks recently. The latest antitrust details released by American regulators show that the US Federal Trade Commission (FTC) accused the company of using secret algorithms to raise market prices, thereby increasing and obtaining extra profits of more than $1 billion.
“Amazon internally created a secret algorithm called’ Nice Plan’ to identify and predict specific products that other online stores will follow Amazon’s price increase. In this way, the tool can not only increase the price of products in its market, but also increase the price of the whole market. “American regulators condemned that” Amazon used the Nice Plan to directly extract more than $1 billion from the pockets of Americans “.
According to reports, Amazon stopped using the “Nice Plan” in 2019, but FTC claimed that “the company has considered reactivating it many times”. The lawsuit said: “Amazon suspended the algorithm during Prime Day sales activities and holiday shopping season because more media and customers paid attention to it at that time, but then restarted the service on a wider scale to make up for the impact during the suspension period.” They pointed out that in April 2018 alone, Amazon used this method to price more than 8 million items purchased by its customers, totaling nearly $194 million. Finally, the algorithm was stopped in 2019.
In a statement to Reuters, Amazon spokesman Tim Doyle assured that the FTC had made a serious mistake in describing the tool. Nice plan is to prevent our price matching from being too low to maintain business.
Amazon announced the closure of its two Amazon Style physical stores, which is reversing the company’s physical retail commitment. These two physical stores are used to sell men’s and women’s wear, shoes, jewelry and beauty products, and ensure a personalized and convenient shopping experience for customers. Shoppers can click the button on the application to send the goods to the fitting room or directly to the delivery counter.
Amazon introduced this concept in January 2022 and currently has two stores in Ohio and California. Both stores will be closed on November 9th. Closing Amazon Style is the latest strategy of this American multinational company. In 2022, the company closed most of its different physical stores, such as Amazon Books Bookstore, pop-up shop and the Amazon four-star product store that sold its favorite products.
In the future, Amazon will focus on strengthening the online fashion shopping experience. To this end, it will expand product selection and introduce new technologies, such as virtual shoes and glasses fitting and size suggestion services. On the other hand, physical store employees will be relocated within Amazon.
Post time: Nov-10-2023