Founded in 1994, the online superstore Amazon.com was created by CEO Jeff Bezos and sold only books. Little did we know, the little site he originally wanted to name “Cadabra.com” would soon transform into one of the biggest commercial sites on the Internet.
While you can find a lot of things on Amazon and the convenience is undeniable, here are 10 kind of shady things about the company they don’t exactly like to broadcast.
10. Take Customer Reviews With A Grain Of Salt
You can’t always take a glowing review at face value on Amazon. Turns out that some of the site’s most prolific reviewers regularly receive free products from publishers, agents, authors and manufacturers in exchange for their “unbiased” opinions. There’s even a site called Fakespot that will analyze reviews for authenticity.
9. Free Shipping Helps You Overspend
Amazon offers free shipping for those who spend more than $25 on certain goods. Amazon Prime members get free two-day shipping on many items as one of the benefits of their membership. Research shows that free shipping actually causes customers make more impulse buys as well as spend more money online in general. #8 really took me by surprise.
8. Their List Prices Are Misleading
When shopping Amazon’s site, don’t be dazzled by those sky-high list prices and eye-popping “bargains.” There’s a good chance that the original prices on Amazon’s site are nowhere close to actual prices that are commonly charged for the item. Amazon’s vendors tend to use high list prices to make their “sale” prices seem that much more attractive.
7. They Hurt Mom-And-Pop Stores
Brick-and-mortar stores with high overhead and sales taxes simply can’t match Amazon’s discounts. While that might not mean much to consumers looking for the best deals, it’s independent stores that have really suffered. Ten years ago, there were about 4,000 independent bookstores in the U.S., according to the American Booksellers Association. Today, only about 1,900 remain. Number 6 made me a bit uncomfortable.
6. They Know More About You Than You Realize
5. They Don’t Pay Taxes
Amazon has a long history of doing all it can to avoid paying taxes. Until a few years ago, Amazon claimed its only physical office was its headquarters located in Seattle, Washington, and that its many warehouses across the US were technically owned by independent contractors. This way, Amazon could claim that its only taxable location was in Washington. I was shocked to learn #4.
4. Amazon Encourages Prime Retailers To Price Gouge
Don’t always assume that if something is Prime Eligible that you’re getting the best possible deal. According to a lawsuit filed in 2014, Amazon suggests that their vendors raise prices on Prime items, to help recoup the shipping costs. So yeah, tack on a few extra bucks and call it “free shipping.”
3. They’re Hard On Their Employees
“Amazon is where overachievers go to feel bad about themselves,” one former employee told The New York Times in 2015. Between tracking warehouse employees by GPS in real time to make sure they don’t stand still for too long to the brand’s culture of ruthless efficiency, the online behemoth isn’t known for being employee-friendly. You won’t believe that #2 is a problem for a company like Amazon.
2. They Have A Counterfeiting Problem
There’s a growing number of fake products being sold by third parties on Amazon, most of them coming from overseas. Sellers of legit goods say their sales are hurting as unscrupulous companies copy their products and offer them at big discounts, while customers are complaining that these cheap knock-offs aren’t the real deal.
1. We’ll Publish Your E-book… Or Else
Amazon captured the ebook market by selling their e-readers at cost or even at a loss in the early years and building a “one-click” model that makes it easy and convenient for people to buy their e-books. Some in the book industry have even gone so far as to openly describe Amazon’s tactics as “predatory.”
Who knew there were so many secrets hiding behind that little smiling box on your front porch? From price gouging to predatory practices, a toxic employee culture to tax evasion all over the globe, it seems that Amazon has plenty of skeletons hiding in their closets. Their rise to the top of the internet marketplace has not been without controversy, yet they seem like an unstoppable freight train of progress and convenience.
How about you? Are you an ardent Amazon fan for life, or do you think they’re a corporate devil? Let us know in the comments and share this article with your friends to keep the conversation going.