Amazon Patents Bad Service For Bad Customers 299
mikesd81 writes "Techdirt reports that Amazon has been awarded a patent for Generating Current Order Fulfillment Plans Based on Expected Future Orders. Essentially, if Amazon deems that you won't be a long time customer or ordering again soon, your order will take longer to be expedited."
Waitaminute (Score:5, Funny)
If another retailer takes forever and a day to ship your stuff, they open themselves up to a patent infringement suit!
This could be a boon for internet shoppers everywhere...
=Smidge=
Re:Waitaminute (Score:5, Insightful)
The reality is that this is a good thing for consumers if the patent makes it through its paces. As consumers we would all know that Amazon provides bad service on purpose, and other retailers would have to pay in order to provide deliberately bad service.
Seems like a win-win to me.
Re:Waitaminute (Score:5, Informative)
What Amazon patented is a predictive model used to optimize inventory handling and shipping.
In other words, they start to figure out the best way to ship you the crap on your "recommended items" list before you even order it. That way, should you actually buy any of that, they will already have figured out the best warehouse to ship it from and the best carrier to use. They also try to predict when you might buy those things, so they can figure in anticipated shipping costs, inventory levels and operating capacity of their various distribution centers. They want to avoid things like inventory shortages and overloading their packaging lines.
The patent says NOTHING about penalizing "bad" customers, or even giving "good" customers a specific advantage. The name of the game is to anticipate orders and optimize the order fulfillment process ahead of time. The only reason a "good" customer would benefit more is because there is more history to build the predictive model with, and thus it will be more accurate.
=Smidge=
In other words ... (Score:4, Insightful)
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Just think that for every package that gets unfavorable treatment, there is a package that gets a better treatment. I bet you money service will improve overall.
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Yeah, it really seems they got it backwards.
Lots of places treat frequent customers better, not many make it a point to treat infrequent customers worse.
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In any case, Amazon is doing it wrong.
My point was, most places will start with service level X and frequent customers might eventually get the better service level X+1.
What Amazon is doing is starting with service level X for everybody, and then going the other way. Frequent customers still get X, but infrequent customers get X-1.
The results are just about the same, but they've chosen a funny way of going about it. "Really good service for frequent customers is too expensive, so lets just provi
Re:In other words ... (Score:4, Insightful)
It started with free delivery on orders over a certain amount. Which is great since P&P used to negate the saving of buying CDs etc. online in the first place. Although free delivery orders didn't have a guaranteed time, they usually only a day or so slower than first class. But then the free option started taking longer to arrive, and now seems like they already deliberately delay sending out orders for a week or so just to guarantee the "up to 5" extra days.
The more amazon do this BS, the more often I go with another company rather than pay their premium for acceptable customer service. I used to just go with amazon for convenience even if they were a tiny bit more expense. Now they've made it a purely numerical decision.
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Oversimplified, I think. (Score:5, Informative)
Sample table from patent [flickr.com]
The system allows them to prioritize delivery methods according to potential goodwill cost. Here's a simple example: Say Amazon has only two customers - you and me. We both frequently buy expensive stuff. I don't really care when it arrives, just so it arrives. You, on the other hand, complain if things arrive late. The system would allow Amazon to know that they should prioritize your shipments over mine.
Now, extend this to many, many customers with widely varying buying habits, and varying attitudes to early, on-time, and late deliveries. It's kind of cool, if you think about it. Say I buy stuff from Amazon very infrequently, but when I do, it's always *really* expensive, and I *hate* it when stuff arrives late. Then there's this other guy who buys less expensive stuff, but buys all the time, and *he* LOOOOOVES it when stuff shows up early, but doesn't much care if it's late. Then there's this chick who buys, on average, one book every month and never says anything positive if it's early, never complains if it's up to a week late, but rants and raves and swears to never buy again from Amazon when something's over a week late...
The system allows Amazon to prioritize shipment plans among their millions of customers, all with varying buying styles and delivery-time cares. They do it because it allows them to maximize their profits, which, it seems, most people on here don't like. But look at the effects - you get, not only *what* you want, but you get it within a timeframe that's acceptable to you!
That having been said, in a very simple sense, you and most others are right that it rewards "frequent customers," but in a limited way. The only way this system gives frequent customers preferential treatment is because frequent purchasers provide more information about buying habits and delivery-time cares to enable Amazon to prioritize. A more accurate statement would be: "This system will give preferential treatment to customers who spend the most money and complain the most if stuff is late and like it when stuff is early." Which makes sense.
Another thing to consider is that Amazon has a limited pool of shipping resources. This system is a method to accurately distribute those resources, but not just according to pure cost - it actually takes into consideration "goodwill cost!" For crying out loud, it takes into account your feelings!
This is an application of free-market principles to an internal resource distribution problem, and it's actually a clever solution. They increase their profit, and you get what you want. I don't see the down side to this. (Other than the patent.)
Re:Oversimplified, I think. (Score:4, Insightful)
EVERYONE has different preferences for shipping times. For some stuff, I want it right away, or for a specific gift, I might want it to arrive on or before a date certain. For other things (like used books for 10 dollars, just as an example), I could care less if it is a few days late.
Did you not read the major takeaway from that comment, which is that there are limited shipping resources and we can only devote so many at any given time? Even in the long run, it doesn't make sense to allocate infinite shipping resources.
What we are saying is this: If you can't get EVERYONE's package on time, doesn't it make sense to figure out who will actually care and matter in the long run and get their on time. If you had to choose which on to prioritize, which one would you get on time?
And to your direct question, yes. It pays to be the squeaky wheel.
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Re:In other words ... (Score:5, Interesting)
to take advantage of amazon's free shipping, you have to be willing to let amazon sit on your order for a while before actually picking it. in my experience, across many orders, this results in about a one week (!) delay. then it's another week or so for ground shipping to deliver it to you.
amusingly, amazon's own marketplace sellers typically ship right away, so it's generally faster to order from one of them than amazon directly. those, of course, don't ship for free. but they do typically ship for less than amazon charges (at least for what i tend to buy).
i'd buy at least twice as much from amazon if they'd just pick the orders within a day or so. i often order from their competitors just for this reason.
if this is a new plan to cause certain shoppers even more delays in shipping, it may cost them even more business. not smart.
Nothing to with customers (Score:5, Informative)
This has nothing to do with Amazon deciding that Joe Smith projects to be a lousy customer so lets not care about the order he just placed.
This is all about trying to determine the most profitable way to fill orders from multiple distribution centers, using projected future orders for those centers.
Of course, it's much cooler to be a sheep and follow the herd, isn't it?
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Re:In other words ... (Score:5, Funny)
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Patent Application Form J2124, Patent for 'Good Service for Good Customers on the Internet in a Shopping Cart Model'
There's no way it could fail!
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It's difficult to estimate precise delivery times. The book may not be in the nearest warehouse, for instance. They may not have the staff at a particular facility to package all the items in a timely fashion. If they over estimate the time it takes to package and deliver an item to an address, the customer may decide that he
Ok (Score:3, Interesting)
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How many of Amazon's customers give a damn about targeted discounts or the one-click patent? Probably fewer than are buying Ratatouille on DVD at $12.49. Blu-Ray at $24.
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The targeted discounts mess was big enough to get amazon to stop and probab ly big enough to keep early adopters away for a little while. The people buying movies on DVD aren't the big spenders. Amazon is looking for early adopters of technology for high margin items, not people buying movies and CD's where the margin is probably under a dollar for the retailer.
The one click patent, probably not so much.
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Wow, Amazon! (Score:3, Insightful)
Re:Wow, Amazon! (Score:4, Insightful)
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Much better to get cu
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One of the reasons I rarely shop Amazon is because of their slow shipping. Seriously, if an item is in stock, I fully expect it to ship the next business day. If it doesn't, I won't be back often. If other retailers can do it, so can Amazon.
I used to cancel orders that sat in Amazon's shipping queue for days on end, even though the item was in stock, and it wasn't near a major holiday or anything of that nature.
After a while, I noticed that each and every one of my orders began going into the nebulous "Processing" category as soon as I went through the checkout. This meant that I could wait the better part of a week for an item to ship, but because it was "Processing", I couldn't cancel it.
That's when I gave up on Amazon, as if their re
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If you have 10 people waiting for products that need to be shifted in 5 days time, and you move 2 of those guys forward to two days, all you're doing is changing the order in which you deal with those 10 customer's orders. The other 8 will still have the orders shipped by the later date.
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Seriously, you want to run that past me again? I don't expect my shit to be consistently shipped at the last possible minute all the god-damned time. Mix it up however you want, two are expedited two are delayed.
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They've given you an expectation of service, and they're pretty good at sticking to it in my experience - if you don't like that, then don't shop there, though it's mystifying why you wouldn't like it.
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If Amazon only have one guy doing all their picking, then he must be incredible.
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There's an explanation above that I've written of how this could work very simply without worsening service for 'non-prioritised' customers.
Please read it.
Re:Wow, Amazon! (Score:4, Insightful)
When you give shipping expectation dates, you don't give the customer the earliest possible date - that leads to disaster when something goes wrong. You give them a reasonable expectation of when the package is going to be delivered which they can accept or not. That gives you time from order completion to dispatch to prioritise depending on the level of business each customer provides. As long as you don't exceed the expectations, then it works out fine.
I wouldn't be surprised (in fact, the opposite, I would be suprised if this wasn't the case) that Amazon have realised they have some extra time between order completion expected dispatch and want to fill that by improving service for their better customers.
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Get Firefox and use the User Agent Switcher extension:
Mozilla/4.0 (compatible; MSIE 6.0; Windows NT 5.1; Caucasian; Male;)
Great idea... not. (Score:5, Insightful)
A) How are you going to prove that another company delayed an order for that reason? How would you be able to prove anything in a court of law, so your patent wouldn't be infringed on?
B) Why, oh why, would anyone use this idea? Delaying the orders of non-longtime customers or customers that are not extremely active is the wrong way to do things. First impressions count, and one of the reasons that I am such a Newegg fanatic is because my first order came overnight via UPS ground, extremely well packaged to boot.
If Amazon implements something like this, I'm not going to shop there out of principle.
Re:Great idea... not. (Score:5, Interesting)
In the case of Amazon.com, you are talking about getting this service without paying for it. If you buy things from Amazon that indicate that you will buy fancy stuff in the future, your order will get pushed out the door faster. If you only buy used books from allied used retailers, then you're order will get fewer CPU cycles devoted to it.
It's just interrupt priority for shipping, basically.
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Very interesting thought - say your first experience with Amazon was buying textbooks in college. Is there incentive for them to ship, say, medical textbooks faster than philosophy textbooks, since doctors are generally going to have more expendable income than philosophers?
This example isn't perfect (philosophers may buy more books, philosophy as pre-law, etc), but there
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If Amazon implements something like this, I'm not going to shop there out of principle.
Oh please. Every brick-and-mortar you do business with does the same thing. It's the expected norm. Don't believe me? Pick a locally-owned restaurant small enough to actually care about customer service. Go there often enough to become a regular. Notice that sometimes you get magically promoted to the front of the "waiting to be seated" list, and maybe get drink refills a little more promptly than other tables on busy nights.
Now, one could argue that you should give preferential treatment to first
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I guarantee that this will result in net faster service.
I could give a rat's ass about "net faster service" I want my shit next week, not some time next year.
I doubt it will result in "net faster delivery", Amazon has orders in the preferred queue and in the non-preferred queue. They need 51% moved into the "shipped before I die" line while the other 49% need to get out the door within the same god-awful time frame we're used to and like you said this doesn't happen, it's either expedited or delayed.
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I'll go along with your intent: I'd leave.
From the restaurant's perspective, that's fine. They'd rather turn away someone who may never have come back anyway than a regular who provides them consistent income.
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This could easily get hit with civil rights lawsuits for that reason. In the US most minorities are, on average, less wealthy. Now what if it turns out that poor people are on average not the best customers because they shop less often, return things after using them for a week, whatever. They could be disproportionately affected by this. This sort of lawsuit happens all the time [nytimes.com] in other industries such as insurance a
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Comparing the two only ignores the ignoble and disgusting nature of racism in insurance and realty.
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I'd guess amazons order scheduling system is very complex and balances a variety of elements, such as:
total order value
ease of scheduling that drop-off
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I think you've missed their intent here. Such a system would almost definitely prioritize new accounts, because of their "future potential".
The sort of account that would likely
The patent is the only thing (Score:5, Insightful)
Now, as to why they thought that patenting it was a good idea, I don't have a clue.
Re:The patent is the only thing (Score:4, Insightful)
That's really easy to answer. It's to stop someone else from patenting it and using it to sue them.
The whole thing is absurd, not just this particular patent, but this stupid torrent of all but worthless patents that is busily burying the US's future ability to innovate..
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Purpose of patents.. (Score:2, Interesting)
Re:Purpose of patents.. (Score:5, Informative)
Implementations of ideas - not ideas themselves. (Score:2)
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Sort of like making a computer simulation of a wind tunnel. Yeah, wind tunnels exist and the ideas and theories are in the public domain, but the actual computer simulation allowing a CAD input and providing a Cd and other info is very novel.
Slow service does not make customers repeat! (Score:5, Interesting)
And slow service will make me want to be a repeat customer?
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Pareto Optimization (Score:5, Insightful)
Amazon wishes to patent this as a form of obstructive competition. (Which seems to be the only use for software and process patents). If they hold a monopoly, nobody else in the commercial optimization space can offer software or business process design that includes this particular expression of Pareto optimization without fear of Amazon's lawyers. It is ugly, but because our government rewards this sort of behavior, it would be against the shareholder's best interests NOT to pursue such patents. Now, if the consuming public provide a massive negative reaction to this behavior, then the shareholders would be rightfully demanding that Amazon and other companies not play the patent game. But we all know how thoughtful most consumers are.
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It's a form of Pareto optimization, in which a reallocation of resources is expected to improve the utility for a subgroup without decreasing the utility of others. In this case, users who are not regular Amazon consumers will not have pre-set expectations of service. So fulfilling their orders in a slightly less rushed fashion will not be noticeable to them.
the problem with amazon's approach to this is that they already have some of the slowest shipping times of any retailer online--at least if you want their 'free shipping'. any other retailer with free shipping picks your order promptly, amazon sits on it for a week before bothering. if i'll pay amazon for the shipping, even though it's the _same_ shipping, they'll pick it right away and i'll get it a week sooner. of course, next day or 2 day shipping is faster yet.
i have no idea if i'm considered a regular
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Well, if we are talking about optimization, thoughtful customers maximizing their own situations individually would probably still find it suboptimal to buy from another supplier, if Amazon is the cheapest one. The kind of behaviour you ask for requires cooperation
The patent (Score:4, Interesting)
Now, I hate business method patents in general, but this one appears to be sufficiently arcane as to not risk much litigation. The point being that it would be extremely difficult to prove infringement by another business, given that business practices are typically kept private.
Of course somebody probably has a patent on labeling isles in stores according to what products are found, and I know somebody had to at least try to patent the mall display that provides a map and legend system to locate stores. Those patents, if they exist, would be an easier target for an infringement suit.
Have we reached such a perfect state of justice that lawyers have nothing better to do than this? Isn't there an ambulance to chase somewhere?
How can *this* be patented? (Score:2, Interesting)
I just don't understand how patents can be delivered for such obvious things..
IANAL, but can the Airlines... (Score:2, Interesting)
Nope. (Score:2)
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"You on the other hand, are a casual traveler who only flies occasionally, so we will give you a heavy discount so you don't go to our competitors."
not valid (Score:2)
Glass half full vs. half empty (Score:2)
You can make the argument that the corollary of such a policy is that "bad customers" get the shafted, but that's not the intent. Using that lo
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I'm baffled by the free shipping (Score:2, Interesting)
Patents are often worded to confuse (Score:2)
Not particularly surprising (Score:2)
I did used to use a much smaller online retailer (dabs.co.uk) quite frequently though to buy computer parts. When I first started using them they offered free delivery if you ordered online. The delivery was only 2-3 day though not next day. Most of the time this didn't bother me, of it did I always had the option to pay for the next day option.
At first when I ordered something that was out of stock so I had to wait fo
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They do it because it is a well-known business practice that is actually being taught as part of selling and business courses.
Read, you lemmings! (Score:5, Insightful)
Anybody who actually read that patent (obligatory of course not, this is slashdot) can see that the article has it totally wrong. First of all, Amazon -would- be stupid to patent what the article claims. It would be very bad for business, and whatever you may think of Amazon, they are extremely good at business. This patent describes a system for determining how to fulfill an order (not just in terms of when to ship, but also, where to ship from, how to ship, etc) based on a multitude of factors. These factors include future orders, but those future orders refer to the expectation of future orders for all customers. Statistics 101 (Amazon surely knows this): the future orders of one specific customer are very hard to model, but the future orders of all customers are pretty easy to model. The point is to optimize the fulfillment process for all customers. Yes, it -could- be possible for them to use these techniques to target specific customers, but I would think it much more likely that they would use this in the favor of new customers they are trying to hook, rather than older established customers. Netflix, anyone?
How can anybody here think they deserve to waste space by posting an opinion on something they haven't even taken the time to check out?
A War on Customers (Score:2)
lesson 0 in selling (Score:2)
Prior Art? (Score:2)
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One of the reps told me on the phone that if you choose free shipping, your order goes through a delivery tar pit (Delivery is deliberately delayed).
That much has been obvious to me for a long time (at least as far as amazon.co.uk are concerned). The actual dispatch date is clearly being delayed on items that are in stock.
I can live with this; they make clear that delivery dates will be 3-5 days later on Super Saver items, and don't actually claim (nor imply, if one actually pays attention) that this is due to slow delivery. Frankly, Amazon are already pretty cheap for a lot of things, and the free shipping must cost them a fair amount on lower-value
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However, since you raised these issues, let me reply to them anyway:-
Amazon only charges your credit card when the order ships - it's in Amazon's best interest to ship as fast as possible so it can charge your credit card.
No, it's not. If Amazon shipped all orders as fast as possible, no-one would bother using the paid shipping op
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There is much more controls on
Re:Buying from them at Christmas could be iffy the (Score:3, Informative)
But simply put, if you have an 'arrives on' date of the 24th or sooner then you will get it on the 24th. If they have to upgrade you from super saver to next day air, then so be it.
Of course due to reasons beyond Amazon's control (eg: vendors didn't deliver) some people don't get what they ordered. In which case we email them on the 23rd after we're certain it's not going (or sooner if possible) and let you know that you won't get it.
I wi