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Amazon Can Bag Your Dollars Even When You're Shopping Elsewhere – CNET

Your guide to a better futureIt’s already the “everything store.” Now Amazon is spreading to other places you shop online.Laura HautalaSenior WriterLaura writes about e-commerce and Amazon, and she occasionally covers cool science topics. Previously, she broke down cybersecurity and privacy issues for CNET readers. Laura is based in Tacoma, Wash. and was into sourdough […]

Your guide to a better future
It’s already the “everything store.” Now Amazon is spreading to other places you shop online.
Laura Hautala
Senior Writer
Laura writes about e-commerce and Amazon, and she occasionally covers cool science topics. Previously, she broke down cybersecurity and privacy issues for CNET readers. Laura is based in Tacoma, Wash. and was into sourdough before the pandemic.
Amazon, with another Prime Day-style blowout of deals this week, may seem like it’s doing everything it can to get you into its store. But, quietly, it’s finding ways to be part of your online shopping elsewhere too. 
Amazon commanded more than 37% of the US e-commerce market last year. After touting its last Prime Day sales event in July as its biggest ever (yet again), it’s ratcheting up a second bonanza of discounts with its Prime early access sale Tuesday and Wednesday. 
Amazon is getting involved in online purchases it typically hasn’t been a part of.
But if you look around, you may see signs of Amazon reaching into your online shopping in new places. In April, Amazon revealed a “Buy with Prime” program that lets sellers add a button onto their own websites. Clicking it, customers can access their Prime benefits for a purchase outside Amazon’s own sprawling store, with Amazon handling the payment and shipping. Buy with Prime makes sense in light of another feature announced last year: Local Shopping, which lets third-party sellers offer curbside pickup from their storefronts on Amazon’s online marketplace. Both facilitate transactions that don’t typically involve Amazon at all.
Both are also examples of how Amazon is leveraging its logistics prowess for other retailers. But taken together, these features also give Amazon entry points into some of your online transactions where it was previously locked out — another way for the giant retailer to have its tentacles touch your shopping cart when you’re somebody else’s customer.  
Stacy Mitchell, co-executive director of an antitrust-focused nonprofit called the Institute for Local Self-Reliance, said Amazon’s aim seems clear. The features are “a way to extend Amazon tentacles,” she said, “to be the interface for every transaction.”
Amazon says it’s helping sellers with the features. Peter Larsen, Amazon’s vice president of Buy with Prime, said in a statement that the company is helping retailers grow their sales by “offering shopping benefits that millions of Prime members love and trust — including fast, free delivery and a seamless checkout experience.”
An Amazon spokesperson added in a statement that the company invests billions per year in building up the infrastructure and services needed to boost the businesses of third-party sellers and merchants, whether that’s on Amazon or not. 
“For over 20 years, we’ve been delivering innovative capabilities to empower small business success,” the spokesperson said, “and we continue to seek out ways to invent on behalf of and delight entrepreneurs and small business owners.”
For now, you’re seeing events like the Prime early access sale this week because Amazon and its peers want to ease you into holiday shopping earlier in the year, according to analysts. And any purchases that take place off of Amazon’s site during the deal frenzy? 
Amazon would like a part of those, too. 
Though you may not have noticed it, Amazon for years has processed customer payments and delivered packages for some purchases made on other companies’ websites. Its Amazon Pay feature and Multi-Channel Fulfillment were both introduced 2007.
Inserting a Buy with Prime button onto a retailer’s website amps up this process. Amazon processes the payments and fulfills the orders as if the purchase was being made on its marketplace. 
Beyond Amazon’s fulfillment support, Amazon will also advertise some sellers that use Buy with Prime on social media platforms, sending customers straight to the brands’ websites. Sellers can also use an official badge to advertise Buy with Prime in their own marketing. 
Amazon will even create some off-ramps from its own website for sellers participating in the program: Businesses will be able to redirect shoppers away from their storefront on the Amazon Marketplace to their own website to use Buy with Prime. 
With the Local Shopping option, which is still in its early days according to Amazon, shoppers who want to get something from a nearby store can look for it on Amazon without having to browse individual businesses’ websites. In addition to driving more of the mega-retailer’s customers to local businesses, the feature requires those shops to list in-store merchandise on Amazon to facilitate the purchases.
Amazon didn’t detail how many retailers are using the Buy with Prime button, which is available to sellers by invitation only for now. One brand that uses the service, Great Circle Machinery, said in an Amazon press release that half its sales are coming from the Buy with Prime feature since it was added. 
“It’s tough to gain shoppers’ trust to make a purchase on our own website,” said Patrick Sean Briseno, the company’s e-commerce and marketing manager, noting that the Buy with Prime badge lends credibility. 
Brian Yarbrough, an analyst at Edward Jones, said some shoppers may find it more welcoming to go to a company’s website to learn more before making a purchase — but still want the benefits of a Prime membership. Plus, retailers can customize the experience shoppers have on their web pages.
“A brand website is much more controlled than Amazon,” he said.
Buy with Prime and in-store pickups are part of a long-running strategy to expand Amazon’s e-commerce business beyond its website, retail analysts say. Just as it faces slowing sales growth, Amazon is sitting on more fulfillment and logistics infrastructure than it needs, a result of building swiftly to keep up with pandemic demand. 
Tools like these are ways Amazon can put its extra order-fulfillment capacity to use, said Neil Saunders, a retail analyst with consulting firm GlobalData.
The options may even appeal to retailers who don’t see the value in selling from an Amazon storefront but could benefit from Amazon’s other services. “Amazon can say: Maybe not everybody wants to be on the marketplace, but we have all these logistics offerings and payment offerings,” Saunders said. 
In addition to getting involved in more purchases, the Amazon features can funnel more data about your shopping habits to the mega-retailer. That way, Amazon has an even clearer picture of what you buy and how you buy it. 
Amazon says it doesn’t sell user data, and pointed to an FAQ about Buy with Prime that says the company won’t use non-public information it gets from those purchases to make its own sourcing, inventory level or pricing decisions, which applies to Amazon’s own products and those from third-party sellers. It also says Amazon won’t use non-public data from Buy with Prime purchases to for merchandising or personalization features on its online marketplace. 
Still, such data has the potential to be “very valuable,” Saunders said. Amazon already uses your shopping information from its own site to recommend other products and place ads in your search results, for example. The company has also been accused of breaking its own policies for not using data from third-party sellers on its marketplace to make competing products under its private label business. Under questioning from Congress in 2020, Amazon’s then-CEO Jeff Bezos said he couldn’t guarantee the policy had never been violated.
Amazon’s spread into further corners of the e-commerce industry is likely to catch the attention of federal antitrust regulators, who are already investigating the company’s practices. The company is far from dominating the market for tools that facilitate purchases from a merchant’s website, Saunders said. Shopify, Salesforce and Adobe are among the many businesses offering these services.
Still, Amazon doesn’t necessarily need to dominate a second industry for these fulfillment features to further boost its market share of e-commerce, said Sucharita Kodali, a retail analyst at market research company Forrester. Additionally, Amazon’s promises not to use the data it gleans from these features may not satisfy the government.
“It would be something I would think antitrust regulators would frown upon,” Kodali said.
For now, it may mean you have more boxes delivered with that Amazon arrow smile.