The way it works is simple. Let’s say you’re out shopping for a TV and you think you’ve found one that meets all your requirements. Now you’re wondering if the big box store down the street is selling it for a cheaper price, so you whip out your cell phone and head to their website. A quick search with the model number lets you know that you could save $50, so off you go. It’s normal to want to get the best deal possible, and people are free to do this as often as they’d like.
However, Amazon has found a way to deter you from doing this in Whole Foods stores. It has been awarded a patent for a system that could block access to rival websites by people using the store’s Wi-Fi. It could even redirect them to certain “counter-competitive information” like coupons or price match offers. Known as Physical Store Online Shopping Control, it can issue one of several “control actions” if it detects customers trying to do something associated with one of its competitors.
Perhaps the creepiest part of the whole system is that it could even alert sales representatives that you’re checking out the competition so they can approach you and try to keep you in the store. Amazon could also send you an email or text message.
Retaining customers is always smart business, but the way Amazon is planning to do it goes against the spirit of consumer freedom. It’s particularly incredulous when you consider the fact that Amazon often benefits from this practice, with many brick-and-mortar retailers complaining that consumers go to their store to check out items in person and then end up ordering them from Amazon for a lower price. This practice is so widespread that there’s even a name for it: showrooming.
Patent grab?
Another possibility is that Amazon’s patent is a way to give them a legal claim against other physical retailers who attempt to put similar measures in place to stop shoppers from checking prices on Amazon while they’re in the store. Preserving the ability for someone to order a computer from Amazon while shopping at a competitor is something they could likely benefit from far more than a shopper finding out a dozen eggs are 80 cents cheaper at the store down the road. Either way, the solution looks like a win-win for Amazon.
This also strongly implies that Amazon is expecting you to learn that Whole Foods’ prices are not the cheapest. If they were, they would actually want you to compare and see for yourself just how much you are saving. Costco has been easily surpassing it in sales, with the wholesaler raking in $4 billion in organic sales compared to Whole Foods’ $3.5 billion, and it’s clear that the store is concerned about losing even more customers to competitors.
Of course, the good news is that it’s relatively easy to get around this if you have a data plan as it will only apply to those using the in-store Wi-Fi. However, one could argue that those looking to save a few bucks on groceries are probably less likely to have a generous data plan.
Amazon recently revealed plans to buy Whole Foods in a $13.7 billion all-cash deal that will see it extend its grocery delivery services to the chain’s 465 locations. The deal is sparking concerns that Whole Foods’ commitment to labeling GMOs on every item they sell by next year will be scrapped by Amazon head Jeff Bezos, whose newspaper, the Washington Post, often promotes the interests of pesticide and GMO companies. Workers are also concerned that they will be replaced by robots given Bezos’s fondness for automating as much as possible.
Sources include:
Please contact us for more information.
