Amazon Faces Consumer And Regulatory Challenges

While Amazon eyes the next step in its seeming bid for domination around the world, it will have to tackle challenges from both regulatory and consumer headwinds. Even so, the company is described as Earth’s “most powerful brand,” and the second most valuable company around the globe, The Telegraph reported.

Jeff Bezos recently told employees, according to reports, “Amazon is not too big to fail. In fact, I predict one day Amazon will fail. If you look at large companies, their lifespans tend to be 30-plus years, not 100-plus years.”

Even with retail sales increasing from $51 billion to $59.7 billion in the first quarter of this year, growth has decelerated. Revenues increased 17 percent in North America compared to 46 percent last year, while international growth has fallen from 34 percent to 9 percent.

At the same time, a federal court ruling could bring complexity to Amazon’s business in the event that it is more broadly applied: It noted the retailer could be held liable for a dog collar sold via its website that partially blinded a woman. The report noted, however, that over half of the items sold on the website come from independent merchants.

And a report from Which?, a consumer group, discovered that unscrupulous sellers are beating the retailer’s security systems with tactics like creating fake reviews. Features that were created to make the eCommerce website more user-friendly were “abused on a grand scale” in an effort to mislead shoppers.

In separate Amazon news, the retailer is reportedly charging “additional funding” to some brands in the grocery space during Prime if sales of their promotional items cause a loss for the online retailer. The company, however, is waiving the placement fee to run promotions for the shopping event, which is said to usually cost $500 per deal.