European competition regulators have opened a formal investigation into Amazon because of the e-commerce giant’s use of data. Officials will focus on the Amazon “Buy Box” which is used by millions of Americans every day. As a regular user of Amazon, you may use the buy box without realizing it and you may be punished for doing so. What is the Amazon “Buy Box” and why should you be cautious when using it?
What Is The Amazon “Buy Box”?
When visiting Amazon and browsing listings, you’re going to encounter the buy box more often than not. The buy box sits on the right-hand side of the page and provides you with vital information such as price, shipping cost, arrival date, fastest delivery, and two buttons, Add to Cart and Buy Now.
Using the “Add to Cart” button will obviously add the item to your cart. Click on Buy Now and you’ll be taken to the checkout page. However, you may not realize that the item is being sold by another party and it might be available at a lower price.
Buy Box Example
Take this example. The Segway Ninebox Electric Scooter is being sold for Amazon for $799.00 with free shipping. If you click “But Now”, you’re going to miss out on the chance to save money. You may not be able to find it on your own but another seller is offering the same item cheaper.
If you scroll down further on the page, you’ll find New (2) from $798.95 + Free Shipping in the middle and on the side. These messages and links are not as clearly visible as the Buy Box. The 3rd party Amazon seller is selling the same Electric Scooter for a few cents cheaper.
And, that seller has a 100% positive feedback rating over the last 12 months. Amazon may get the item to you on Sunday, June 28 but the other guy will get it to you on June 29 – July 1. Sure, it is only 5 cents but the Buy Box betrayal doesn’t stop there.
Out Of Stock Buy Box
Amazon likely suspects it can deliver items quicker than 3rd party sellers. And, there are fewer risks involved when it handles the transaction. So, it is understandable when the company takes the Buy Box and it is only a few cents higher. But, what happens when Amazon doesn’t have the item at all? In this case, Amazon doesn’t have the item but its Fulfilled by Amazon 3rd party seller will on July the 28th.
Amazon has given that seller the buy box at $10. The problem here is that the seller is significantly higher than the individual shipping it without Amazon’s assistance. For the out of stock Amazon fulfilled seller, you’ll get the item for $10 between August 2 and August 4. If you stick with the other guy who doesn’t have the buy box, you’ll get it for $6.95 between June 30 and July 6.
Why would anyone pay $3 more for the same item even though it isn’t in stock until July 28? And, who is to say it will be in stock then? Unfortunately, this is a common occurrence on Amazon’s Marketplace and it hurts 3rd party sellers and buyers. The 3rd party seller won’t make the sale because they don’t have the buy box.
As for buyers, they’ll pay nearly $4 more for it and they’ll have to wait to get it. In some instances, Amazon removes the buy box completely. It may have something to do with the fact that they do not have a dog in the fight. When Amazon doesn’t need to secure a stranglehold on the buy box, it removes it entirely.
Unfortunately, Amazon doesn’t always offer the lowest price. Nevertheless, it almost always holds onto the Buy Box. In the following examples, you can see that Amazon’s price is much higher than the competition. Still, Amazon maintains the buy box which likely results in the customer paying more.
This disregard may be further evidence that the company does not always put its buyers and sellers first. Those brave enough to shop on Amazon must pay close attention to the buy box and all prices from 3rd party sellers. Otherwise, they may foolishly believe Amazon has their best interest at heart and that could result in them paying a bit more for the same item.