What is the terrifying strategy of Chinese companies that pollute the Amazon marketplace?
The Amazon Marketplace, which allows individuals and small businesses to set up store pages on Amazon, started in 2000. However, in the Amazon marketplace where anyone can freely list products, there are many companies that offer poor quality products and services, and it is just a mixture of boulders. The Wall Street Journal, an American economic newspaper, points out that 'the number of Chinese vendors has increased so much that the Amazon marketplace is declining.'
The Surprising Reason Your Amazon Searches Are Returning More Confusing Results than Ever --WSJ
Initially, the Amazon Marketplace was a free place for manufacturers, middlemen, bargainers, and Amazon to compete, resulting in price cuts and benefits for consumers. According to The Wall Street Journal, 'The purpose for Amazon is to enrich the product lineup without increasing the cost of inventory, and by entrusting inventory management to an outside vendor, the Amazon marketplace has become a new business model.' It states.
However, as Amazon worked with Chinese manufacturers and distributors in the mid-2010s to offer more products at lower prices, the share of Amazon marketplace sellers with Chinese vendors surged. According to data from research firm Marketplase Pulse, the percentage of Amazon's top 10,000 sellers based in China was about 20% in 2016, to almost 50% by the end of 2020. It is said that it has increased.
And Chinese distributors did not 'sell famous brands cheaply', but developed their business with the policy of 'displaying and selling products at the top of Amazon's overall ranking'. By optimizing for the search algorithm, even if you are dealing with the same product as other sellers, the top sellers will be displayed at the top of the search ranking, and you will be known as 'the seller who handles that product'. In addition, there is also a 'strategy that gives consumers an image that guarantees a certain level of quality even for completely unknown brands and products' by using a system based on Amazon reviews and star ratings, and a tag of 'Amazon recommendation'. It was taken.
However, in reality, it turned out that many of the products offered by Chinese sellers were counterfeit brands and did not comply with consumer protection standards. Of course, many sellers based in the United States have similar problems, and there are Chinese brands that are evaluated for their quality and service. Even so, it is widely known that 'Chinese vendors selling on Amazon have poor product quality and service quality.'
'The problems caused by Amazon's opening of the Amazon marketplace to Chinese vendors have become more apparent in recent years,' the Wall Street Journal said. In 2019, a reporter from The Wall Street Journal found on Amazon thousands of banned items, low-safety items, misleadingly labeled items, etc. , Most of them were sold by Chinese sellers. There have also been
In May 2021, the existence of a fake reviewer who asked Amazon to write a fake review on a product and its customer was revealed by a database leak containing more than 200,000 personal information.
Amazon's fake review organization reveals database leaks containing more than 200,000 personal information-GIGAZINE
Also, in order to establish a brand on Amazon, it is necessary to register the trademark in the United States where Amazon is based, so it is said that a large number of new trademarks have been applied for registration at the US Patent and Trademark Office.
Of course, Amazon isn't doing anything, spending 12,000 people and $ 900 million (about 120 billion yen) and banning more than 2.5 million fraudulent seller accounts, an Amazon spokeswoman said. Says. Also, in September 2021, it was reported that more than 600 accounts of Chinese brands, which have many fake reviews and fake reviews, were deleted.
Amazon Announces Expulsion of Over 600 Chinese Brands Covered With Fake Reviews-GIGAZINE
Jason Voice, CEO of Avenue7Media, a consulting firm targeting vendors selling products on Amazon, said, 'Amazon Marketplace is also taking measures, but there are endless cat-and-mouse games with vendors who use forbidden cowardly tactics. It is clear that it continues. '
Furthermore, according to the Wall Street Journal, an 'aggregator' that absorbs and expands small Chinese vendors selling on Amazon has appeared. In order for Chinese vendors to continue their sales business on Amazon, they need enough funds and staff to handle branding, advertising, and product management on Amazon, which makes it impossible for small vendors to sustain their sales business. It will be. That's why aggregators are buying sales businesses from small sellers.
Amazon says it's not cracking down on vendors based in any particular country, but according to The Wall Street Journal, many of the exiled vendors are based in China. thing. The Wall Street Journal argues that there are still Chinese vendors who will not give up listing on Amazon because Amazon is the mainstream e-commerce platform in the United States and Europe. In fact, Anker has launched sales of 1 billion dollars (about 130 billion yen) on Amazon as of 2021 by narrowing down the sales platform of the product to almost only Amazon, and a Chinese company that made a leap globally with Amazon as a trigger. It can be said to be an example of. 'If a Chinese-based company wants to win consumers in the West, it has to use Amazon as a simple fact,' said Louis Ma, a Chinese investor. ..
The Wall Street Journal said, 'More broadly, Amazon may need to radically rethink how it can deliver value to its customers on an ever-expanding platform. Consumers have too many choices. I think there are unnamed brands that try to trick us. Jeff Bezos said 'customers first,' but I don't think those unnamed brands are thinking about that. ' Said.
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