Data warning from the Competition Authority about e-commerce marketplaces

In the report prepared by the Competition Authority on e-commerce marketplace platforms where more than one seller sells from a single site, consumers are warned about data privacy, while the “free” offers of these sites It was pointed out that it collects the data of consumers in exchange for services.

The “e-Marketplace Platforms Sector Review Final Report”, which was prepared within the scope of the industry review initiated by the Competition Authority to identify potential competition problems and to determine effective policy tools to combat them, has been completed.

According to the report, “self-serving” behaviors are observed in the e-marketplace platforms market. In this context, issues such as “giving priority to their own product in listings and rankings”, “providing unfair advantage in products of which it is the seller by using the seller’s data” and “providing unfair advantage to the sellers who benefit from their related services compared to other sellers” come to the fore.

Customers are shown different prices

It turns out that “price discrimination” is applied to consumers in e-marketplace platforms. Price discrimination is known as “the application of different prices for the same product to groups of consumers in a similar position”.

Algorithms allow marketplaces to charge consumers personalized prices. In this case, some consumers pay more for the same product than others. Thus, it is ensured that the marketplace earns a higher profit from certain sales compared to other sales.

With loyalty programs implemented by e-marketplace platforms, consumers can earn “points/gift money” or “gift vouchers/coupons” and spend them on shopping in the relevant marketplace, receive priority notice of discounts, benefit from free shipping, and prioritize customer service. is given.

Loyalty programs can cause consumers to withdraw from seeking alternatives or choosing multiple access.

Collecting data in return for free service

According to the report, marketplaces may choose to offer some services “free of charge” to attract consumers to their platform, without charging a monetary fee. However, the term “free service” used here is generally considered misleading. Platforms pay for their “free” services with consumer data. Therefore, although consumers do not pay for these services, they actually make a payment with their data.

For platforms, consumer data is seen as a monetary asset. As the consumer data they collect increases, platforms can both improve their marketing strategies by predicting their preferences more accurately and make advertisements for consumers more targeted. This increases the willingness of advertisers to pay.

Consumers can become tempted by the services offered without any monetary cost and lose their sensitivity at the point of sharing their data.

What data do they collect?

Marketplaces, consumers, name and surname, e-mail address, phone number, address information, birthday, date of meeting, marriage and engagement anniversary, bank account, credit card and IBAN number, voice, search, It collects a wide range of data, including correspondence, social media correspondence and complaint records, IP address, website login and exit, password, password information, membership history, shopping history, survey and cookie records.

There are fake reviews

The report also warns about comments, which are among the most important factors affecting consumer preferences. It was pointed out that the negative comments of these comments were hidden in the lower ranks or that fake comments could be found.