Amazon trounces rivals in battle of the shopping 'bots'
By Jeffrey Dastin
SAN FRANCISCO (Reuters) - Earlier this year, engineers at Wal-Mart Stores Inc (WMT.N: Quote) who track rivals' prices online got a rude surprise: the technology they were using to check Amazon.com several million times a day suddenly stopped working.
Losing access to Amazon.com Inc's (AMZN.O: Quote) data was no small matter. Like most big retailers, Wal-Mart relies on computer programs that scan prices on competitors' websites so it can adjust its listings accordingly. A difference of even 50 cents can mean losing a sale.
But a new tactic by Amazon to block these programs - known commonly as robots or bots - thwarted the Bentonville, Arkansas-based retailer.
Its technology unit, @WalmartLabs, was unable to work around the blockade for weeks, forcing it to retrieve Amazon's data through a secondary source, according to a person familiar with the matter who was not authorized to speak publicly.
The previously unreported incident offers a case study in how Amazon's technological prowess is helping it dominate the retail competition.
Now the largest online retailer in the world, Amazon is best known by consumers for its fast delivery, huge product catalog and ambitious moves into areas like original TV programming. But its mastery of the complex, behind-the-scenes technologies that power modern e-commerce is just as important to its success.
Dexterity with bots allows Amazon not only to see what its rivals are doing, but increasingly to keep them in the dark when it undercuts them on price or is quietly charging more.
"Benchmarking against Amazon is going to become hard," said Guru Hariharan, a former Amazon manager who now sells pricing software to retailers as chief executive of Mountain View, California-based Boomerang Commerce. Continued...