> Anyone else find Amazon's comingling of stock to be insanity?
They make so much off of AWS now, the market operations are probably just a massive headache to leadership with comparatively lower margins. Unattractive to pay attention and devote resources to, when the same thrown at AWS yields far more profits per unit thrown.
The dynamics that emerge from commingling pushes more buyers to Amazon Basics, which undoubtedly yield much higher profits, so there isn't much incentive to fix it for impacted categories and brands.
I've read that there is a feature that allows Amazon sellers to lock down their SKU's so only specific, named ship-from's are allowed to stock Amazon warehouses. If this is true, then I'd like to hear how this works, and rationales on why more sellers aren't using it.
There might be a core assumption so deeply embedded into the data fabric of "one instance of an SKU is as good as any other instance" that changing the assumption would yield too little benefit to clear some internal IRR metric. I'd caution against that; ceding the market operations to eager competitors to take it away would deny Amazon extremely valuable data. Data whose value I assert far outstrips the decreased margins to fix the commingling problem. This goes far beyond any kind of shopping data. I further assert if Amazon actually unlocks the real value of that data, they'd evolve way beyond their current positioning as a software-driven logistics company.
Even for that current positioning as a software-driven logistics company, this is a curious issue to possess the hot potato upon for so long. Competitors would be well-advised to look and think deeply on what this means on whether they can/should use this to beat Amazon.
Amazon likely is not eager (to put it lightly) to enter into many traditional distributor-retailer relationships with manufacturers, which gives negotiating power back to the sellers. Very far from the commoditize the complements strategy they prefer. The current structure is a manufacturer's Panopticon, even more brutal than the Wal-Mart buyer-department-culture-driven model. Amazon wants to vertically integrate to the point they don't need a relationship, and ideally all the way back through into manufacturing, reaching as far back into the supply chain necessary to secure a welded-shut tight integration, thus capturing all available profits.
They make so much off of AWS now, the market operations are probably just a massive headache to leadership with comparatively lower margins. Unattractive to pay attention and devote resources to, when the same thrown at AWS yields far more profits per unit thrown.
The dynamics that emerge from commingling pushes more buyers to Amazon Basics, which undoubtedly yield much higher profits, so there isn't much incentive to fix it for impacted categories and brands.
I've read that there is a feature that allows Amazon sellers to lock down their SKU's so only specific, named ship-from's are allowed to stock Amazon warehouses. If this is true, then I'd like to hear how this works, and rationales on why more sellers aren't using it.
There might be a core assumption so deeply embedded into the data fabric of "one instance of an SKU is as good as any other instance" that changing the assumption would yield too little benefit to clear some internal IRR metric. I'd caution against that; ceding the market operations to eager competitors to take it away would deny Amazon extremely valuable data. Data whose value I assert far outstrips the decreased margins to fix the commingling problem. This goes far beyond any kind of shopping data. I further assert if Amazon actually unlocks the real value of that data, they'd evolve way beyond their current positioning as a software-driven logistics company.
Even for that current positioning as a software-driven logistics company, this is a curious issue to possess the hot potato upon for so long. Competitors would be well-advised to look and think deeply on what this means on whether they can/should use this to beat Amazon.
Amazon likely is not eager (to put it lightly) to enter into many traditional distributor-retailer relationships with manufacturers, which gives negotiating power back to the sellers. Very far from the commoditize the complements strategy they prefer. The current structure is a manufacturer's Panopticon, even more brutal than the Wal-Mart buyer-department-culture-driven model. Amazon wants to vertically integrate to the point they don't need a relationship, and ideally all the way back through into manufacturing, reaching as far back into the supply chain necessary to secure a welded-shut tight integration, thus capturing all available profits.