Some of the popular listings on the Amazon UK website were defaced by racist comments. Though the abuse was removed from the American retailer’s website but the social media platform, Twitter was flooded with screenshots of those comments.
However, the company claims to have identified the source of these racist comments but did not disclosed the details. These comments are believed to be triggered due to the death of a black man in police custody in the United States. According to some media reports, the Seattle based E-commerce company has removed the content.
The kind of challenges faced by Amazon is also due to socio-political factors. The online businesses, specifically in the Business to Consumer space are likely to face these kinds of challenges. In the last week of April, Amazon’s foreign e-commerce platforms, including Amazon UK, were blacklisted by the US government for selling counterfeit and pirated products. However, the company had denied all the allegations and said the move was a mere political stunt. The company said that it has all checks and balances in place and has zero tolerance towards counterfeiting and piracy.
Another issue faced by the online business platforms is regarding fake reviews of the products available on the website. According to some media reports, people are being paid to write fake reviews about products. It is obvious that people do it for supplementing their incomes, but it adversely affects the business prospects of the company.
Last month, the UK Competition and Markets Authority (CMA) had launched an investigation into several major websites for suspicious reviews, manipulations in terms of related products and paid reviews. Most of the websites are swamped with fake 5-star ratings.
Challenges faced by online platforms
To understand these challenges, first, we need to understand the business model adopted by these online platforms. Most of the retailers are mere sellers’ aggregators and provide a virtual space for showcasing their products. For every sale, the aggregator gets a commission. Hence, more sellers mean more commissions.
Now the problem is, people are not able to gauge the quality of the product online as they are used to touch and feel the product before buying. Hence, with statistics playing a huge role in our lives, we tend to factor the ratings of the product in our buying decision. Most of the times, ratings can significantly influence the decision.
Not all brands are well known to consumers, and the online aggregator is home to several brands which the consumers have not even heard of. Therefore, it is hard for consumers to trust any brand.
Another issue is counterfeiting and price gouging. As the delivery network is huge, the sellers can easily counterfeit products. In addition, differential pricing is a common phenomenon for some of the online retailers.
Remedies which ought to be followed
To address these kinds of issues all the loopholes in the supply chain should be plugged in. The eligibility criteria to be a seller on these platforms should be more stringent. New brands or sellers must join forces with existing credible sellers. Only after they have proven their credibility, they should be allowed to operate on a standalone basis. The online platforms should invest in technology to closely monitor each of the steps in the supply chain.
Not everyone should be allowed to rate the product. Ratings should come from credible sources which are on merit and not because of any influence. Price gouging and profiteering should be randomly checked upon by concerned authorities to ensure healthy competition in the markets and in the best interest of customers.
The American multinational is into the business of cloud technology, AI devices and e-commerce. The company started just as a Bookstore in the US. Since then it has grown exceptionally high. Amazon has been a veteran in this sector and is trusted by its customers.
The technological advancement, in general, has reshaped the world in which we live today. Different sectors of the economy are hugely reliant on technology. Everything has become more convenient, and the work is done by just a few clicks. Even in the pre-Covid era, Amazon was a trusted brand name for online shoppers.
The company initiated a dedicated timeslot for elderly people in the UK at Whole Foods Market stores. The company recently launched an option of "unattended delivery" following the pandemic for its Prime Now, Amazon Fresh, and Whole Foods Market customers. The company also reiterated that it strictly discourages price gouging and profiteering.
Nobody in the world was prepared for the novel coronavirus outbreak. Around 38 thousand people died in the UK due to the pandemic. The coronavirus induced lockdown was possible because of technology. People were asked to stay indoors and practise social distancing. Non-essential retail shops were closed. People were hugely reliant on the online retail platforms for the goods they need.
With more than two months of lockdown, the dependence on online retailers has grown manifolds. The buyers are not confident of visiting the stores due to fear of falling prey to Covid-19. The online platforms also offer ease of convenience along with exciting deals on some days. In addition, the old and the vulnerable people are inclined to use these platforms more often.
According to the report from the Office of National Statistics (ONS), the online sales reached a record high of 22.3 per cent in March 2020 as compared to overall retail, due to sudden change of shopping behaviour of consumers as they chose to buy through online platforms following the outbreak of the novel coronavirus.
The online retailing was up by 5.1 per cent in value in March 2020 when compared with February 2020. In March 2020, non-store retailing increased by 5.1 per cent in value terms and the volume of goods was up by 5.9 per cent when compared to the previous month. The non-store retailers were able to boost sales as they were able to continue trading during the coronavirus pandemic. Another interesting fact from the Office of National Statistics (ONS) report, was that out of recent internet users in 2019, 91 per cent of them were adults in the UK. This suggests that the internet, on which the online business model feeds, is widely available to people in the UK.
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