Consumer Watchdog takes Amazon and Ebay to task
eBay and Amazon Marketplace are failing to crack down on a spate of coronavirus-profiteering by sellers after a Which? investigation uncovered a wide range of products for sale on marketplaces with inflated, and often ridiculous, prices.
At the start of this month, the Competition and Markets Authority (CMA) warned that traders should not be exploiting the coronavirus outbreak to take advantage of people through price gouging, and threatened to take strong action if the problem persisted.
However, the consumer champion’s snapshot investigation suggests third-party sellers are still brazenly ripping-off consumers and using the current situation to list overpriced items that are difficult or impossible to find in local shops.
Which? found consistent overpricing of household items, including cleaning products, thermometers, baby formula and tampons – products that are all currently in particularly high demand during the coronavirus outbreak.
There were hundreds of active listings and auctions for dramatically overpriced items, including a £40 thermometer priced at £300 on eBay and £150 on Amazon. A £3 bottle of disinfectant was on sale for £29.99 on eBay – a markup of up to 1,000 per cent – and was more than three times the recommended price on Amazon.
Meanwhile on eBay’s auction site, a flurry of bids sent the price for a bundle of three bottles of Dettol spray and three packets of antibacterial wipes soaring to £210.
Which? also found that consumers were actually buying these overpriced products from eBay, despite the extortionate prices. For some listings taken down during the investigation, eBay showed that multiple items had already been purchased before the listing could be removed.
The research also demonstrated a failure of ‘filters’ and other checks put in place by eBay and Amazon to adequately protect consumers, despite both having stated publicly that they have taken action on the issue.
When Which? asked eBay on 9 March what action it was taking to protect customers from price gouging on antibacterial gel, it said it had filters in place to prevent the listing of these items. But these listings continue reappearing, suggesting the systems in place are not working effectively.
Amazon seems to be having more success, with a number of active listings disappearing during Which?’s investigation. However, more are still appearing.
Which? is calling on eBay and Amazon to take more effective action against third-party sellers trying to take advantage of consumers at this difficult time.
Online marketplaces should be bringing in far stricter controls to identify and prevent these practices of charging unjustifiable high prices for essential products. They must communicate their policies clearly and directly with sellers.
This investigation raises serious broader questions about the checks and balances that eBay and Amazon currently have in place and their inability to prevent harmful listings, a problem raised repeatedly by Which? through its research and investigations.
If the systems used by the tech giants are not capable of preventing harmful listings from appearing at all, then better manual systems need to be put in place to identify and remove them.
While online marketplaces are taking action, both claim to have removed listings and suspended or terminated accounts during the coronavirus crisis, this investigation shows they need to be doing more. If they fall short, the CMA’s new coronavirus taskforce needs to take action to stop these practices. The CMA has already engaged with the big platforms to find out more about what they’re doing to address the issue of retailers on their sites charging very high prices for essential items.
Given the exceptional circumstances brought about by coronavirus, the government should consider how it will work with the retail sector as a whole to tackle irresponsible price-hiking – bringing together businesses, including supermarkets and online marketplaces, as well as Trading Standards and the CMA – to agree how to keep essential items, that should be accessible to all, at reasonable prices.
Sue Davies, Head of Consumer Protection at Which?, said: “Online marketplaces have taken some action against coronavirus price gouging, but our investigation shows unscrupulous sellers are still cashing in on people’s fears by selling essential items at extortionate prices on eBay and Amazon.
“These companies must make good on their pledges to stamp out coronavirus profiteering, and if they fall short the CMA must be ready to take strong enforcement action.
“The government should consider how it will work with the retail sector as a whole to keep the price of essential items reasonable as the fallout from the coronavirus outbreak continues.”
An eBay spokesperson said: “All the items flagged by Which? have been removed and enforcement action has been taken against the sellers.
“We announced on Friday additional measures to tackle coronavirus-related price gouging. This is a continuation of the aggressive action against price gouging, which has included suspending hundreds of accounts, removing hundreds of thousands of listings, and suspending scores of bad seller accounts. Specifically in the face masks and hand sanitiser categories, only pre-approved whitelisted vendors will be allowed to sell these items.
“We are continually monitoring the situation and will consider widening the ban to include other categories if appropriate.”
An Amazon spokesperson said:“There is no place for price gouging on Amazon. We are disappointed that bad actors are attempting to artificially raise prices on basic need products during a global health crisis and, in line with our long-standing policy, have recently blocked or removed tens of thousands of offers. In addition to removing these offers, we are terminating accounts.”