Shaoul Sussman ’19 wrote a post for ProMarket, the blog of the Stigler Center at the University of Chicago Booth School of Business, explaining how, despite the challenges Amazon is facing due to COVID-19, the company will emerge from the global crisis on top.
In the last two weeks, it became apparent that Amazon is seizing the moment by leveraging its position as intermediary between quarantined consumers and distressed merchants to bolster its grip over the retail sector. Enforcement agencies and lawmakers should step up and scrutinize Amazon’s activities at this critical moment. If they fail to do so, Amazon’s power over our economy would dwarf the power it possessed prior to this pandemic.
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While Amazon’s decision created chaos for its third-party sellers, it simultaneously revealed that Amazon’s house brand products were all deemed by its algorithm as high priority and essential by the e-commerce giant. These items include Amazon’s tablets, smart speakers, and even earbuds. This, of course, allows Amazon to increase sales of these items if comparable products by its competitors cannot be delivered within a reasonable amount of time.
