The Amazon price glitch on December 12 hit a huge number of companies. For around an hour, RepricerExpress, an automated pricing system for Amazon’s online retailer’s MarketPlace, went wrong and priced thousands of products at a single penny.
During the glitch, up to 75 million items were set to 1p and more than 2,000 sellers were affected. There are fears some businesses might go bankrupt as a result of the error, writes City A.M. It has cost retailers across the UK thousands. And caused issues in terms of reputation — some negative customer feedback has been damaging.
Amazon says “it responded quickly” to cancel most of the orders placed. Obviously, the situation sparked a buying frenzy as consumers hoped to make the most of the bargains. But some purchases slipped through the net and were distributed over the succeeding weekend, especially those from companies that have automated fulfilment centres.
Go2Games, a small, privately-owned independent retailer of consoles and video games, says it has a confirmed loss of £11,000 as a result. It’s brand has suffered and claims it was even “directly targeted in some cases”, as people looked to snap up digital products cheaply. Go2Games saw that people had posted links to the “deals” across the web.
“It has been incredibly stressful,” Jess Wright, of Go2Games tells Business Insider. “We were at our company Christmas party on Friday evening celebrating all of our work for the year when the glitch struck, so we didn’t catch it right away. As soon as we found out, we were working tirelessly through the weekend to try and reach out and repair the damage.”
The sheer cost of the stock sold and dispatched poses a real threat to Go2Games, Wright explains. If all orders had been completed the company would have lost well over £350,000, with a gross total sales of only £262. The confirmed losses are far less, but remain significant — 220 orders were automatically shipped by Amazon over December 13/14. Only £146.59 came in.
Wright says the problems go further than instant monetary losses: “Aside from the financial implications of this error, we are also seeing a threat to our brand. We have managed to maintain 100% positive customer feedback for our 2 years trading on the channel.
“With many cancellations on the horizon, our customer satisfaction has dipped, with our feedback seeing an immediate decline as a result. It is such a shame as we have been working so hard to make a name for the company in terms of quality of service, we were just starting to come into our own.”
And some customers are annoyed they didn’t receive their 1p buys. “We’re not looking at a handful of disappointed customers,” Wright notes, “we’re looking at thousands”.
Wright adds that the situation is “mostly upsetting,” but says there are some positives. After sending out emails to customers and posting an “urgent appeal” blog explaining what happened, some people returned their items for a refund rather than see a small company at risk.
Still, “most customers seem to be under the impression they are buying directly from Amazon and nobody gets hurt,” adds Wright. They appear unaware that livelihoods are at stake.
As of December 17, Go2Games had yet to receive a “firm response” on how the ongoing situation will be handled from Amazon or RepricerExpress — though the two have assisted in part. Overall however, it seems there is no definitive prospect of compensation.
Disclosure: Jeff Bezos is an investor in Business Insider through his personal investment company Bezos Expeditions.