Amazon.com Inc.'s determination to offer shoppers the best deals is prompting merchants selling products on its marketplace to raise their prices on competing websites, a testament to the company's growing influence over the e-commerce market.
Amazon constantly scans rivals' prices to see if they're lower. When it discovers a product is cheaper on, say, Walmart.com, Amazon alerts the company selling the item and then makes the product harder to find and buy on its own marketplace — effectively penalizing the merchant. In many cases, the merchant opts to raise the price on the rival site rather than risk losing sales on Amazon.
Pricing alerts reviewed by Bloomberg show Amazon doesn't explicitly tell sellers to raise prices on other sites, and the goal may be to push them to lower their prices on Amazon. But in interviews, merchants say they're so hemmed in by rising costs levied by Amazon and reliant on sales on its marketplace, that they're more likely to raise their prices elsewhere.