Amazon Just Landed a Patent That Could Throttle Online Retailers
It’s a strange move for a company that grew its business by offering lower prices online.
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The world's largest online retailer has just been granted a patent for a system that stops brick-and-mortar customers from comparing in-store prices to competitors' online offerings--a move that's been largely viewed as head-scratching at best. After all, the retailer has constructed a vast empire by putting many a brick-and-mortar retail shop out of business with its lower prices.
The patent, which was first reported by The Verge, is called 'Physical store online shopping control.' It describes how a retailer can monitor customers' Internet use--while on the store's WiFi--and deter them from checking competitors' prices. A practice that occurs so frequently, people have given it a name: 'showrooming.'
When the technology detects users attempting to compare an item price on a competitors' website, the retailer can try to persuade them to buy it in-store by offering a coupon or to price-match the competitor. It can also block users from browsing the competitor's site altogether.
While it sounds like something befitting George Orwell's 1984, one can already see the possibilities for the technology. While Amazon's patent waxes lovingly about the plight of the brick-and-mortar retail store, it stops short of actually naming a reason for the tool. The following possibilities may be in the offing: Amazon might decide to license it to brick and mortar retailers, for instance. Or it may just use the technology itself.
Jeff Bezos's company has already opened several brick-and-mortar bookstores, the latest one opening in New Jersey this week. And of course, it may well use the technology in its other businesses, which now includes more than 460 Whole Foods stores.
Of course, Amazon could also just bury the technology. That way, nobody can apply the system against it. Only time will tell.