Amazon Sponsored Products are keyword-targeted advertisements that allow advertisers to promote certain items. To get the sponsored label, advertisers bid under certain conditions, and ads with higher bids are more likely to show.
Amazon said in a statement that it disputes the Journal’s findings, but recognizes that certain keywords related to Amazon devices may have limited ad inventory. The company said these limitations are an example of retailers deciding what products to promote or showcase on their website, which it says is standard practice. Amazon added that it’s possible for companies to bid on ads and not win the auction.
“News flash: Retailers promote their own products and often don’t sell their competitors’ products,” Amazon spokesman Jack Evans said in a statement. “Walmart refuses to sell Kindle, Fire TV and Echo. Shocker. In the next Journal story, they will learn about gambling in Las Vegas. ”
The investigation revealed that Roku, which competes with Amazon’s Fire TV, has not been able to purchase advertisements related to both Amazon’s devices and its own products for several years. Roku’s search results on Amazon’s website often display ads for Roku competitors, Roku products offered by resellers, and promoted ads for Amazon’s Fire TV near the top of the search results, according to the Newspaper.
Roku declined to comment.
Other competing device makers have encountered similar issues purchasing sponsored ads on search results for Amazon’s products, including Facebook, which makes voice-activated smart displays that compete with Amazon, and Arlo Technologies, which makes smart security products that rival Amazon-owned Ring smart doorbells.
The actions could attract the attention of regulators who are already reviewing Amazon’s business practices.
The Journal found that members of Amazon’s devices team flagged the products of large competitors, called “Tier 1 competitors,” to prevent them from buying ads on Amazon’s own products. Additionally, when Amazon’s devices team launches a new product, employees are tasked with determining which keywords to remove from the ad and are encouraged to discuss those issues in emails labeled “privileged and confidential”. , in order to prevent regulators from accessing associated emails, the Journal told me.
Amazon told CNBC that employees are only asked to mark emails as privileged when they seek legal advice.
Amazon faces ongoing investigations in Europe and the United States, where the House Judiciary Subcommittee on Antitrust has examined how Amazon uses data from third-party sellers to create private label products. Amazon’s competitors have previously accused the company of using predatory pricing practices to suppress rivals.
Read the full story of the Wall Street Journal.
– CNBC’s Megan Graham contributed to this article.