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Thursday, Oct 28, 2021
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This Is The Reason Why Amazon Is Again In Trouble In India

Examining the company's internal emails, strategy papers and business plans reveal that the e-commerce giant exploited internal data from their website to make products of a similar kind. This was subsequently offered on the platform.

This Is The Reason Why Amazon Is Again In Trouble In India
This Is The Reason Why Amazon Is Again In Trouble In India
outlookindia.com
2021-10-13T21:34:16+05:30

A recent report by news agency Reuters states that Amazon followed a systematic Operandi in knocking off products sold on its website by exploiting the vast internal data. The idea here as stated by the news agency was to promote its own merchandise at the expense of the other seller. 

Examining the company's internal emails, strategy papers and business plans reveal that the e-commerce giant exploited internal data from their website to make products of a similar kind. This was subsequently offered on the platform. 

Further, the investigation states that the e-commerce giant would rig search results on its website. This was meant to prioritise their products on the search results. A2016 strategy report for India stated, “in the first 2 or three … search results” when customers were shopping on their website, the agency informs. 

Reuters further stated that Amazon employees studied proprietary data from other brands that sold on their platform. This included customer returns. The idea here was to identify and then mark products that could be replicated for profitability. 

In the first article of its series on Amazon, Reuters had stated that the e-commerce giant had favoured the big sellers on its platform. Further, they used those sellers to get around regulations meant to protect the country's small retailers. The Competition Commission of India had sought information and documents from Amazon following the report. 

Amazon, like other aggregators, prefers to sell its own brands as a major driver of increased profitability, informs Reuters. This is because an in-house brand offers lowered production and marketing costs. 

Amazon, in response to the allegations, stated they believed that the mentioned claims were factually incorrect and unsubstantiated. It added that the news agency has not shared the documents or their provenance with them, therefore, they are unable to confirm the veracity or otherwise of the stated information and claims. 

It elaborated that the e-commerce platform “strictly prohibits the use or sharing of non-public, seller-specific data for the benefit of any seller, including sellers of private brands,” and that it investigates reports of employees in violation of this policy.

Amazon India was recently accused of bribery by an Indian publication, The Morning Context. According to the report, Amazon had initiated an investigation into the conduct of its legal representatives in India. Three individuals with awareness of the developments told the publication. The development follows a whistleblower complaint alleging a certain amount paid by Amazon in legal fees have been used to pay bribes by one or more of its legal representatives. 

Two people who work closely with Amazon's in-house legal team told the publication that its Senior Corporate Counsel Rahul Sundaram has been sent on leave. He replied to the publication's request for comment stating, "Sorry I cannot speak with the press". 

Amazon spokesperson told Outlook Business, "We have zero tolerance for corruption. We take allegations of improper actions seriously, investigate them fully, and take appropriate action. We are not commenting on specific allegations or the status of any investigation at this time".

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