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EMAILED ON September 11, 2017 BY THE HUSTLE

Amazon’s “price gouging” debacle

This past weekend, Hurricane Irma made its way into Florida, causing one of the biggest evacuations in US history (at least 6m people).

The storm inspired a number of charitable acts on behalf of Americans around the country. But others — including vendors on Amazon — saw it as an opportunity to price gouge those in need.

And unfortunately, Amazon’s algorithms are set up in a way that inadvertently rewards them for it.

One man’s disaster is another’s gain

Shortly after news of Hurricane Irma broke, dozens of Amazon shoppers reported seeing water products listed at huge markups.

Packs of Aquafina and Nestlé usually priced at $4 were suddenly showing up for $25 (a 600% increase) — and shipping on some cases was as much as $180.

Though Amazon came under heat for the increases, these products were actually offered by third-party vendors on the marketplace.

It’s just the algorithm, guys

Amazon’s pricing algorithm is designed to weed out vendors who price gouge (and to the company’s credit, they’ve already responded by banning of them).

But the real reason expensive waters are popping up on Amazon is that the cheaper offerings have all sold out, and the previously buried, ridiculously priced ones are now front and center.

Still, as Bloomberg writes, the platform’s propensity for matching supply and demand “enables a cut-throat capitalism that comes across as heartless during a natural disaster.”

As if fancy “spring” water wasn’t overpriced enough…