Last week, the Australian Competition and Consumer Commission flagged concerns around how online marketplaces operate. In this special series, Ragtrader looks back at the submissions to its Digital Platform Services Inquiry.
Kogan has alleged traditional retailers deny the supply of brands to pureplay retailers, warranting an investigation by the ACCC.
The corporate watchdog has flagged issues around marketplace competition, with concerns some online retailers are preferencing the sale of private label goods on their site.
In a response to the ACCC Issues Paper, Kogan stated that the sale of goods was uniform throughout the industry.
"Whilst some marketplaces, like Kogan, also sell their own-branded products, on the same websites as marketplace sellers, this is no different to incumbent retailers such as Coles and Myer who have operations that compete with their suppliers, such as developing their own private label products, allowing concession stores within stores, and competing online channels.
"In fact, in Kogan’s experience, marketplace sellers that tend to offer similar product categories to the categories where Kogan’s own-brands are most well-known tend to attract more business on the Kogan marketplace than sellers in categories for which Kogan is less well known. In other words, competition within the platform actually boosts seller performance on the platform."
Kogan also questioned supply agreements in place with traditional retailers.
"Kogan submits that there is indeed a gatekeeper role in Australian retail that warrants regulatory attention and investigation, and has significantly diminished competition for many years. That gatekeeper role is played by large traditional and incumbent retailers with significant market share - who influence the denial of supply of popular brands to online retailers.
"Kogan submits that a primary reason why online retail penetration in Australia is lower than comparable countries internationally is due to this practice. It is not by choice that Kogan, which is one of Australia’s largest online retailers, cannot gain supply of a significant number of famous brands - we submit it is due to the pressure exerted by major Australian retailers on brands to deny supply of their goods to online retailers - especially those like Kogan who seek to drive down prices for consumers."
Last week, the ACCC flagged a range of concerns about how retail marketplaces - such as Amazon Australia, Catch, eBay Australia and Kogan – operate.
Concerns included the use of algorithms to decide how products are ranked and displayed, with some marketplaces giving preference to their own products.
The collection and use of consumer data was also cited, as well as inadequate dispute resolution processes and a need for more consumer protections.
The ACCC’s fourth report in its Digital Platform Services Inquiry examined whether online marketplaces are promoting fair and competitive markets for consumers and sellers.