Why Amazon Is Not A Marketplace

Amazon.com violates the most rudimentary rules of marketplaces and is merely a superstore. The antithesis of a free-market marketplace.

If you’ve read my previous blog on marketplace rules, you would agree. Amazon.com is a Super Store which, by expanding the relationship with other premium suppliers mimics the appearance of a marketplace. And because Jeff Bezos associates Amazon.com with a marketplace frequently, I stand to correct him:

Marketplace rules.
Rule #1: Failed. Amazon limits the supplier participation to its premium strategy.
Rule #2: Failed. Limited suppliers mean limited transactions are available
Rule #3: Failed. Amazon regulates the process of how a transaction takes place, conforming to Amazon pricing models
Rule #4: Failed. Once you order from a different supplier than Amazon, all bets are off with regards to transparency, shipping, returns, etc
Rule #5: Failed. There is no way for new buyers to see who bought what at what price and equally for sellers who sold what.
Rule #6: Failed. User opinions are irrelevant if they are not borne out of a transaction.
Rule #7: Perhaps not relevant here.
Rule #8: Failed. Amazon is “competing” in the “marketplace” with its suppliers

Amazon will have a much harder time to sustain growth and meet Wall Street expectations, as a lot of growth through premium suppliers will become non-organic (or sell through revenues). Amazon has plenty of opportunities to migrate to a real marketplace without losing its footing, but it better hurry.

In the meantime, Jeff, please call Amazon what it is: Jeff’s premium selection.


The sign of an intelligent nation is its willingness and ability to reinvent itself, upstream. Let’s inspire the world with new rigors of excellence we first and successfully apply to ourselves.

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