Amazon Patents Bad Service For Bad Customers

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

[Smidge204]

This could be a blessing in disguise!

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

[hedwards]

I'd be curious to learn why you were modded funny rather than insightful or interesting.

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

[Smidge204]

It was a joke. Amazon didn't patent "treating customers like crap" no matter what the summary or linked article say.

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 ...

[Aetuneo]

As I said when this was posted on Techdirt, this system could encourage customers not to shop at amazon, because when you start shopping there the shipping takes longer. Appeasing a small group of users who make up the majority of purchases and irritating a larger group who make only occasional purchases is not the way to go.

Re:

[Protonk]

I think it's clever and creative. It's basically a free version of Newegg's preferential shipping scheme.

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.

Comment removed

[account_deleted]

Comment removed based on user account deletion

Re:

[jlarocco]

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.

Re:

[jlarocco]

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 ...

[Yahweh Doesn't Exist]

I used to really like Amazon's service, and still use them a lot, but find myself liking, and using, them less.

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.

Re:

[mazarin5]

I decided to enroll for a second degree this year. The student bookstore ran out of three of the books I needed and wouldn't have more for a couple weeks, so I ordered them off of Amazon with expedited shipping. It was more than enough to get the free shipping, but time was essential. After three weeks, I called to find out where my order was and they said they would refund the shipping and send it out the next day. About a week later they canceled the order without bothering to tell me, and gave me a credi

Oversimplified, I think.

[baboo_jackal]

I think you (and most other posters) missed the point by oversimplifying it. I don't think this is a system that gives more frequent customers better treatment, and less-frequent ones worse. Here's why I think that - take a look at this:

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.

[Protonk]

Sigh.

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.

Re:

[blahplusplus]

I think a semi-randomized mixed system might to the trick, but would it be any different from a total randomized system?

Re:In other words ...

[zarqman]

As I said when this was posted on Techdirt, this system could encourage customers not to shop at amazon, because when you start shopping there the shipping takes longer. Appeasing a small group of users who make up the majority of purchases and irritating a larger group who make only occasional purchases is not the way to go.

amazon has already implemented their picking system to discourage customers from buying direct from them. i can't tell if this is another way to discourage customers or if it's merely the formal patent for the existing implementation.

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

[acvh]

As it seems that no one has read the damned patent - here is the concise version:

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?

Re:

[Bwana Geek]

You'd think that, but according to the 80-20 rule, 80% of a company's profits come from 20% of their customers. If they give superior service to their most loyal customers, I bet their profits will increase overall.

Re:In other words ...

[base3]

Better hurry--and be sure it says "on the Internet" so it's patentable.

Re:

[the_lesser_gatsby]

Too late. But "on a mobile phone" is still available.

Re:

[Jarjarthejedi]

Still not creative enough...hmm

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!

Re:

[Jeremy Erwin]

Amazon's real secret? When you purchase something on Amazon, their delivery commitment is vague enough that you can be at the "back of the line" and still get your goods when promised.

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

[Protonk]

I can understand why you would DO this, but why in God's name would you patent it? Amazon already has the black eye from attempting to give targeted prices to members (oops) and a patent black eye by flouting the USPTO's decision on one-click. What business model is being protected by patenting the mechanism to put orders on the back burner?

Re:

[westlake]

Amazon already has the black eye from attempting to give targeted prices to members (oops) and a patent black eye by flouting the USPTO's decision on one-click.

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.

Re:

[Protonk]

LOTS.

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.

Re:

[hey!]

Actually, this is just business common sense. It's common sense to take the best care of your best customers. It's also common sense that this sometimes means poorer service for your less preferred customers. Since good customers are profitable and bad customers are unprofitable, if you can shift more of your business towards your good customers you make more money. If Amazon does this right, it doesn't matter to them that you get pissed off at them and never do business with them; if that happens it

Wow, Amazon!

[base3]

Self-fulfilling prophecy much? It works both ways, guys--if you slow my order because you don't think I will be a good customer, guess what, you can be pretty sure I won't.

Re:Wow, Amazon!

[Protonk]

I'm pretty sure people would have forgotten about this had Amazon not seeked to patent it.

Re:

[base3]

Guess it was pretty stupid of them to patent them and put themselves in the limelight for customer hostile practices, then, wasn't it? The good news for Amazon here is that people have amazingly short memories, but their timing might cost them a few bucks if this gets picked up on by someone like Walt Mossberg.

Re:

[Threni]

Amusingly, they used to charge existing customers more, presumably on the grounds that they've already hooked you and don't need to try as hard. I don't think that little trick lasted very long. I might go to Amazon first to check the price and get details of the product, but I always then look elsewhere to see if I can get it cheaper.

Re:

[Protonk]

the design of the price selection system was meant to provide lower prices to price sensitive customers and higher prices to price insensitive customers. Plenty of companies do this through self selection (top of the line gaming rig vs. budget box), but amazon got busted using a pretty unsophisitcated way of doing it. Partially boned by (as base3 said) AOL's practice of aggrigating IP addresses and the mixed nature of cookie handling, it wasn't a very good idea to begin with, anyways.

Much better to get cu

Re:

[account_deleted]

Comment removed based on user account deletion

Re:

[Y-Crate]

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

Re:

[account_deleted]

Comment removed based on user account deletion

Re:

[bangzilla]

Have your read the patent? There is *nothing* about slowing orders if you don't order much. Scheese - if you're going to go negative please do so based on actually *reading* what you are complaining about.

Re:

[Macthorpe]

they'll slow orders to customers who are not predicted to order in the future.

Or perhaps that they'll ship orders faster to regular customers and the service to new/occasional customers will be exactly the same?

Re:

[cyphercell]

so, there's a line with ten people in it, how do you move two forward without moving two back?

Re:

[Macthorpe]

Customers to Amazon aren't in a line, so that's a bad analogy.

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.

Re:

[cyphercell]

all you're doing is changing the order in which you deal with those 10 customer's orders

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.

Re:

[Macthorpe]

Why do you care, as long as they adhere to the date they've given you?

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.

Re:

[Macthorpe]

No it's not, because a line implies that the customers have to be served one after another.

If Amazon only have one guy doing all their picking, then he must be incredible.

Re:

[cyphercell]

so, you're saying this is a patent to hire more pickers? you're making me laugh now, surely you're joking. It really doesn't matter how many pickers they have, 100 pickers have to pick 1000 orders ONE AFTER ANOTHER. Let's say 10% are moved to the front, another 10% are moved to the back.

Re:

[Macthorpe]

I'm not sure whether you're just trolling now or not, but I'll continue.

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!

[Macthorpe]

That doesn't have to happen, and you need to take this from someone who has worked in an exclusively online bookstore.

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.

Re:

[Raven42rac]

They've been doing something similar to this for a while, they kind of sit on your order if you get the el-cheapo shipping, which I'm willing to deal with. Sometimes the shipping can end up negating any savings you might realize from buying through amazon.

Re:

[FLEB]

Being as it is a matter of public record though that they have the technology, one has to wonder if/when some organization such as the NAACP set up for the protection of minorities might sue and file for discovery to ascertain the degree to which minorities are being discriminated against by these methods.

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.

[Coopjust]

This is not only a dumb thing to patent, but also something that is a dumb idea in general.

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.

[Protonk]

this is a GOOD idea, and not that far removed from the Newegg concept. Newegg spends money and charges more in order to push items out the door faster. You can pay MORE in order to get something tomorrow. Partially what allows them to do this IS an ordering system that prioritizes orders from one source over anothers. That is what allows them to fill boxes and get them to UPS faster.

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.

Re:

[dontthink]

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.

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

Re:

[Protonk]

Meh. Probably not. I would be impressed if they had the data to universally correlate type of textbook purchase with future value. To me it seems likely that a new tezxtbook purchase would signal pretty clear price insensitivity of demand, and they would declare you a priority customer.

Re:

[Protonk]

I'll bet quite a bit. I'll wager that they've compiled data showing that 1 click users offer a much better margin than checkout shoppers and so they will probably give priority to a 1 click purchase.

Re:

[VCAGuy]

...and not only that, they'll probably also prioritize Prime customers accordingly...they tend to be more loyal because they're getting their shipping discount, and don't want to buy it somewhere else because fast shipping "costs more" there (though not everyone might get their $79 worth...I know I did...I bought a Mac Pro from them and had it shipped overnight for $3.99).

Re:

[Just Some Guy]

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

Re:

[cyphercell]

I see your point, but this is Amazon we're talking about. Basically, they're saying if you're a new customer you may have to wait four hours for a glass of water, shit the only thing Amazon should ever say about poor service is that they're doing whatever they can to eliminate it. Dumb-asses, if I'd heard about this two years ago, before two different "Amazon direct" purchases were delayed nine months I'd have felt even more entitled to good service, I wonder how they'll treat good customers they treat like

Re:

[Protonk]

YOu know that this system isn't just: "Ok, if you suck and buy used books, we are going to bench your order just out of spite for months on end." Every time someone's order is delayed, another order gets expedited. This is how shipping preference works. It's how ocean container shipping works. If you pay big bucks for the container, you get moved in first, if you don't, you get to wait until another container shows up and you can fit inside it after someone else has paid its way. This way, more shippin

Re:

[cyphercell]

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.

Re:

[Protonk]

ok, so don't shop there. I can't fix you if you're bent out of shape about some order you didn't get. I bet you AMAZON gives a shit about net faster service and the rest of amazon's customers do as well.

Re:

[cyphercell]

Customer's don't care about "net faster delivery" when one out of ten of those orders are late, one out of twenty are excessively late, and one out of fifty are shipped whenever. Anyways, when Amazon is filling every shipping container, "net faster delivery" will not be achieved without adding infrastructure. Oh, and I guarantee the only person that gives a shit about when I get my order at Amazon is the guy at customer support. Otherwise, I'd be compensated.

Re:

[Moralpanic]

Alright, lets run with your restaurant analogy. I know that if i were at a busy restaurant, and i was waiting 30mins for a table, and some regular showed up, and got seated before me, i would leave. What would you do?

Re:

[Just Some Guy]

What would you do?

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.

Re:

[timeOday]

A) How are you going to prove that another company delayed an order for that reason?

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

Re:

[Protonk]

It happens all the time in those industries because they STILL red line and STILL use scare tactics to push black and latino buyers and policy seekers out of the market. there isn't even room for comparison between ACTIVE discrimination in housing markets and an automated system that computes predicted value of future purchases and assigns a shipping priority accordingly.

Comparing the two only ignores the ignoble and disgusting nature of racism in insurance and realty.

Re:

[DrSkwid]

Are poor people a minority now ? I didn't notice that happen.

Re:

[cliffski]

It doesn't sound like they deliberately delay anything, just that good customers get to the top of the queue. I'm not at all surprised by this. If you sell widgets and have 2 emails in you inbox, one from a guy who orders a widget each Christmas, and one from that guy who buys about 36 a week, whose do you reply to first? They are just automating the system.

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

Re:

[moosesocks]

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.

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

[canUbeleiveIT]

Why is this different than any other enterprise? Bigger customers generally get preferential treatment. If two customers call me and have network issues, and I have billed one of them $50,000 in the past year, while the other one bought one compact flash card from me two years ago, which one am I going to take care of first?

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

[rucs_hack]

Now, as to why they thought that patenting it was a good idea, I don't have a clue.

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..

Re:

[Protonk]

Pretty sure that unless it was actually patented previously, their protection would come from prior use. Patent protection serves (in cases like these) to defend a competitive advantage based on novel tech for a while.

Purpose of patents..

[cyberjock1980]

Patents are supposed to protect an inventor's invention so that other's can't duplicate it allowing the inventor to earn money for his invention. Generally speaking a patented idea is a good idea. Yet lately I'm seeing more and more patents being approved that just seem downright bad ideas. They are trying to protect themselves from potential 'bad customers'(being those that will only buy once or twice). How can someone even think of something as idiotic as this? Seriously? They're already marking som

Re:Purpose of patents..

[Protonk]

Your idea of 'good' or 'bad' ideas doesn't really factor in to what patents are or aren't supposed to protect. They protect novel ideas.

Implementations of ideas - not ideas themselves.

[Animaether]

They're intended to protect novel (or improved, see patent law) implementations of ideas. Not ideas themselves - no matter how novel they may be.

Re:

[Protonk]

Creating a system to predict future revenue streams from customers then input that prediction into a shipping preference system sounds pretty novel to me.

Re:

[Protonk]

No, it's not. I didn't work on it, but I can damn well bet that the level of sophisitcation and the novelty of analysis and control are enough for it to be distinct from older uses.

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!

[Tsu Dho Nimh]

"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."

And slow service will make me want to be a repeat customer?

Re:

[Protonk]

I'll bet a week's salary that you wouldn't be able to tell the difference.

Pareto Optimization

[gregor-e]

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. By applying the resources freed from servicing new customers to improved service of old customers, the old customers will sense that Amazon just keeps getting better and better for them, further cementing their loyalty.

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.

Re:

[fermion]

Except that for huge operations like amazon, they set the expectations prior to the customer receiving the goods or services. This is the basic philosophy of a big firm. There is supposed to be less risk than if one deals with a small shop. In the case of Amazon, the ads, or a friend, or a next door neighbor, may have lead me to expect free shipping in less than a week. If I order a few things from them over some long period of time, and each item takes longer than my expectations, I may decide not to u

Re:

[zarqman]

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

Re:

[DrSkwid]

One should mention that just because they have patented it, doesn't mean that they are necessarily using it.

Re:

[Alef]

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.

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

[Cracked Pottery]

I read as much as I could before my eyes glazed over. The patent doesn't simply address individual customers, it describes a system to minimize costs where a large vendor, such as Amazon, has a number of distribution centers. It as much concerns regional demographic features as individual customers.

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?

[renoX]

Even mom&pops shops have been doing it for a long time: best customers are treated better.

I just don't understand how patents can be delivered for such obvious things..

IANAL, but can the Airlines...

[ducomputergeek]

Claim prior art on this one?

Nope.

[Nick Driver]

Because they standardize poor service for all customers uniformly. Exactly the same as both wired and wireless phone companies and also all the major brand PC makers too.

Re:

[Attila Dimedici]

No, because the airlines generally do the reverse. "You are obviously a business traveler, who flies more often, therefore we will charge you more."
"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

[m2943]

Businesses have been doing this for a long time, using various paper-based methods. While a specific way of doing this might be patentable, merely creating a computer version of this shouldn't be a valid patent.

Glass half full vs. half empty

[prisoner-of-enigma]

OK, enough with the negative-veiwpoint-only here. The poster is making it sound like Amazon is trying to patent and codify a method to give bad customer service. This is misleading in the extreme (not that that's anything new in Slashdot articles). Amazon is trying to ID and reward customers who are likely to do larger amounts of business with them in the future.

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

Re:

[Kjella]

Using that logic, any "customer loyalty program" that anyone ever introduces is shafting someone. Does that sound like a sensible argument?

No. Was I supposed to expect any?

I'm baffled by the free shipping

[gelfling]

I order to different yet related items yesterday. For some reason one of them was eligible for free shipping. But the default order packaging is to ship the items together and charge me $15. I have to go in, tweak the order, separate it into 2 shipments and the shipping cost goes down by half, that is one of the items is free. They both come to me from the same place. I am scratching my head on this. It can't be good for Amazon to break up the order. And it irritates me to have to muck with their order. Plu

Patents are often worded to confuse

[foniksonik]

This is a patent on a system to provide tiered service.. nothing more, nothing less. However it is worded in it's summary or abstract has nothing to do with the method it implements other than to provide an example of how it COULD be used, not how it WILL be used. In fact this could be implemented to provide tiered internet service, tiered data provisioning among servers... ie: it could be used as a clustered server farm system management policy - wherein a server that is not doing so well (DOSed, traffic b

Not particularly surprising

[Ash Vince]

First let me say I have never used Amazon although I might do at some point in the future.

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

Re:

[wikinerd]

The moral of this story is that this is something that every company does unofficially anyway.

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!

[eaglej]

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

[JoeCommodore]

I really like how many retailers are now taking this war on customers stance. I think a lot of companies are realizing they don't really like customers, only their money, so they are working harder to get the money with little customer involvement as possible. And those customers that do interfere with getting money are treated more as enemies.

lesson 0 in selling

[wikinerd]

This idea, that you should take care of 'good' customers more than 'bad' customers, is lesson 0 in any selling course, taught from the very first day. So, now to get a patent, one has only to take an established idea and computerise it?

Prior Art?

[PPH]

What if another business already has a broader claim? Providing bad service for all customers.

Re:

[canUbeleiveIT]

Yeah, but you should put packing peanuts in the box as well. After all, what's the first thing that someone does when the box has the little Styrofoam nuggets in it?

Re:

[Dogtanian]

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

Re:

[bangzilla]

| 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). *utter bullshit* - You'll notice when you place an order on Amazon you are given a delivery promise. If you don't like the promise, you don't have to complete placing your order. Why would delivery be deliberately delayed? 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

Re:

[Dogtanian]

Uh... you're aware that the part of my message you were replying to was actually a quote from its parent? If you want to respond to that, hit the reply button on the original message. (As *I* said, I had no problem personally with Amazon delaying orders, because they were upfront about it, and still met their delivery promises.)

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

Re:

[synx]

This is not true - you're describing postal injection, which does not involve sending packages "in the right direction". It's highly calculated and precise - based on zip3 (the first 3 of your zip). Generally most postal injection lanes pick up 3 days/week. If there is no postal injection available and your super-saver shipment is due in 3 days, it'll go UPS ground. Not to mention that PI is expensive to run if there isn't high utilization, hence it isn't run all year long.

There is much more controls on

Re:Buying from them at Christmas could be iffy the

[synx]

I used to work in supply chain at Amazon, thank god I don't anymore.

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