Amazon’s annual Prime Day is nearly upon us. Like Christmas in July, this annual “holiday” is a shopping bonanza for Prime members with deals on stuff that they want or didn’t know they needed.
While Amazon aims to reel in Millennial and Gen Z shoppers, one federal agency intends to land this big fish. The Federal Trade Commission (FTC) under Chairman Lina Khan has targeted Amazon in recent weeks. One FTC lawsuit alleges that the digital retailer is employing coercive actions to “trick consumers into enrolling in automatically-renewing Prime subscriptions” and then making it difficult to cancel.
The next impending lawsuit could upend the corporate giant’s business model. Like throwing spaghetti against the wall, Khan hopes something will stick.
Bloomberg reported recently that the FTC is finalizing plans to sue the company over the operations of its core e-commerce marketplace. While it’s understandable that people have concerns about how retail giants, from Amazon to Wal-Mart and Target, impact traditional Mom and Pop stores on Main Street, some of these selling giants actually facilitate the creation of small enterprises. Over half a million third-party merchants sell on the marketplace and reportedly account for a quarter of the company’s whopping $469 billion in revenue. These merchants can choose to manage their own storage of inventory, fulfillment, and delivery of orders or pay Amazon for a range of these services.
Amazon has said it invested more than $100 billion over the last 20 years in establishing soup-to-nuts logistics capabilities—from fulfillment centers to a streamlined transportation network operating by air, sea, and land—that can guarantee free one- or two-day delivery. Nearly nine out of ten sellers value these services enough to opt into the program. READ MORE