Home > mint-lounge > mint-on-sunday > A Kasparov-like battle with Amazon 

It was with much anticipation that I was looking to snag some deals on the much-hyped Amazon Prime Day. Not because I am a shopaholic—but because I thought this as good a day as any to test a hypothesis I’ve clung on to in my head. That if thought it through right, I could beat the Artificial Intelligence (AI) embedded into the black box that are Amazon’s algorithms. 

At least in my head, this was intended to be a chess-like game. And something as big to me as Gary Kasparov versus Deep Blue. That Kasparov eventually lost is one thing people still speak of as the turning point in the battle between human intelligence and that powered by the power of computing. But there is no taking away from the fact that those matches could have gone either way. And that Kasparov put up a bloody good fight. In fact, some analysts and commentators have it that it just happened to be that Kasparov had a few days. Else, he may have trounced Deep Blue. 

 Be that as it may, I have nothing romantic to report, save that I capitulated. Amazon beat not just me, but captured my family as well. No movie can be made of the encounter that ensued between man and the algorithms that power the beast that is Amazon. And I concede, my ignorance now stands revealed. 

 What happened? Why did I crumble? How does Amazon now control me? 

What happened 

• In theory, I was prepared. And I was darned sure I wouldn’t concede a rupee to those conniving creatures called algorithms. So, when Amazon announced that on its much hyped “Prime Day", offers of all kinds would be made, among the first things I did was redeem the points I had earned on my credit card spends as Amazon vouchers. Overnight, I had Rs3,500 at my disposal. 

• I was clear I have nothing to buy, but the Amazon Fire Stick—a device that allows you stream content from Amazon Prime to your television via the internet (in hindsight, the dumbest thing a man trying to beat Amazon could have set his eyes on). 

 I usually access content on Amazon Prime via my laptop when time permits. Quite honestly, I like Prime because at an annual fee of Rs499, it offers me video and music of all kinds on demand. “Peanuts," a monkey in the brain argues, “for the benefits that come bundled with it." 

• But that is an aside. My point here is the sticker price of the device that is the Fire Stick on any given day is Rs3,999. And my stated position was I will not give a dime away to those algorithms to buy it. 

• With Rs3,500 in hand, I ought to have sat pretty. Because evidence has it from other markets where Amazon is present that it drops prices of the Fire Stick significantly for a few hours to attract buyers. My punt was that with the kind of money at my disposal, I’ll get the device after they drop prices and still be left with some to buy an odd e-book or so. 

• But the whiz kids at Amazon had other plans. The announced that if I buy the stick at Rs3,999, they’d credit Rs499 into my Amazon account. Effectively, a discount of Rs499. This was a googly. Because to execute the purchase, I’d first have to pay Rs499, over and above the Rs3,500 I was sitting on. 

• The monkey in the head got restless and pushed me. I ought to have ignored the creature. Because this announcement did not comply with precedents in a few ways. For one, it was not a significant drop in price. And two, this announcement was made a few days before the big sale, not just before it started. Usually, the big price drops happen just before the sale begins. To that extent, this drop was out of pattern. 

But like I said, the evidence did not stand to scrutiny against the monkey and it argued if I add Rs500 to my account, I’d have money on hand to buy the device and have cash credited back to my account. If the price drops further, buy some more free stuff, blah, blah. I conceded. 

• The monkey was horribly wrong. A little after I added Rs499 and before the sale started, Amazon dropped prices of the Fire Stick by Rs999 for a brief while with a cashback of Rs499 thrown in. For all practical purposes, I was staring at a price drop of Rs1,500. 

• All chances of a smirk on the face were wiped. I could have got the device for Rs2,500 and had my books. But in a battle between the monkey in my head and the folks at Amazon, “rational me" lost. 

The math started to look ridiculous as well. 

1. Because I had added Rs500 to the Rs3,500 that already existed on the voucher, I had Rs4,000. 

2. After spending Rs2,500 on the device, I still had Rs1,500 left over. The rational part of me ought to have got some much-needed books or some such things and exited. 

But by now I was mad. “How dare some ridiculous algorithms make me look silly?" They had to be put in place. A strategy had to be thought up. It was furiously done, because there was evidence to suggest Amazon would drop prices of some things people crave for a brief while—like they did for the Fire Stick—to lure people in. 

 To cut a long story short, before I knew it, I was in there. Waging a war. Not just that, there were some words there that had gotten the monkey’s eye—albeit insidiously. Like, “More Deals". “Upcoming". I could put it on “Watching" as well. Carefully chosen words I must admit; crafted to get my attention. 

Why did I crumble?

 All thanks to a chance encounter with that classic, Why we Buy: The Science of Shopping, a book by Paco Underhill, and listening to the people who work at crafting the retail experience, I have some understanding of how people in the retail business operate. Malls, for instance, are designed by people who understand not just design, but psychology, and how the human mind works. 

In the Indian context, for instance, some supermarkets have crowded aisles where people hustle and jostle for space. This is very different from the antiseptic environment supermarkets are known for in other parts of the world. This was not by accident or for lack of space. But because the people who designed it knew that those they want to attract into their aisles would be uncomfortable in an antiseptic environment. They are comfortable in the regular bazaars where jostling is a way of life and no offence is taken. But there is no taking away either from that they crave the supermarket experience on the other hand.

In creating crowded aisles, thought leaders in the retail business cracked a very real issue and gave a lot many people the comfort of shopping in a “supermarket", but in an environment not unfamiliar to them. Call it sheer genius if you will. 

So, what happened to me at Amazon on Prime Day? A few things I think I know with the benefit of hindsight. 

• The team at Amazon dropped prices beyond what I expected they would. If I had lost on the deal, it would have created pain at having lost. If I had lucked out, I may have wanted to spin the roulette some more to push my luck. Then there are cases like mine that felt pain at being outsmarted.

• In any which case, when in pain, the monkey in the brain felt hurt. In turn, another part of me, the rational, wanted to whack the monkey for playing me against myself. The two got into an argument. At some point, they arrived at a consensus and suggested, “Let’s get you another gadget to compensate for the pain. This time, we won’t repeat the mistake." 

• A little trick I figured that works at a lot many places is that if you place something into the shopping cart, something begins to happen. The algorithms attempt to direct you to the checkout and payment zone. But if you drop the item from the cart there, almost instantly, these “creatures" offer a discount. Pretty much like a salesman would to persuade you in real life. 

Two places come to mind right away. Freshmenu.com sends in a frantic email with a discounted price if you don’t buy a selected item. And The Atlantic monthly offers a 15% discount off its already discounted price for an annual subscription if you attempt to move out. I’m sure they have some safeguards in place including on how many such attempts will they accommodate. But it’s worth trying. 

• Another trick to dump random stuff into the cart—some that you may need and others that you don’t. It also helps if you have multiple addresses and can mask your internet protocol (IP) address using privacy tools. It’s worked often while trying to haggle with vendors of all kinds on Google. 

• On Amazon, if I like something, I don’t buy it right away. I put it into the wish list and wait. Inevitably, the prices drop after a while. No rocket science there. A digital simulation of an offline marketplace where the vendor eventually gives up in exasperation and says, “Okay, don’t choke my warehouse. I’ll drop my price a bit so you’re happy and I can move on to get some more business." But the vendor won’t sell at a loss and I know it as well. In any case, both of us benefit. 

• So, back to Amazon. On Prime Day, I thought I’d try to combine these stunts and confuse the algorithms. But these creatures are far more intelligent than what I had imagined. What I hadn’t factored in was that those price drops were partly engineered by humans and partly by algorithms. The mechanics are unclear because entities like Amazon operate in a black box. Assuming algorithms had dropped prices, as a friend explained to me, they have now evolved to levels that make them significantly smarter than you and me. 

• It has figured there are clowns around who will try to game the system. Over time, it has a built a history of the kind of things I like, will pay a premium for, am looking at, will jump for, am willing to wait for, and so on and so forth. To that extent, these algorithms are self-learning systems built on layers and layers of data about me and the ecosystem I live in. Anything that doesn’t fit into these patterns it will construe as me trying to muck around with its “brain", if you will. So, it knows when to ignore me—much like any smart retailer in the offline world knows what kind of customer to avoid. The issue here is the preciseness with which it can target or ignore me on the back of data. 

I don’t intend to get into how this leap in machine learning and blurring of lines between human and artificial learning has come to happen. But there is an essay that explains the nuances of it all in what is without a doubt one of the finest reads of the year on “How Aristotle Created the Computer". The writer, Chris Dixon, summarizes how things are: “Logic began as a way to understand the laws of thought. It then helped create machines that could reason according to the rules of deductive logic. Today, deductive and inductive logic are being combined to create machines that both reason and learn. What began, in (George) Boole’s words, with an investigation ‘concerning the nature and constitution of the human mind’, could result in the creation of new minds—artificial minds—that might someday match or even exceed our own." 

There are billionaire nuts like Elon Musk who believe this is inevitable and that if humans must survive, humans may just have to leave planet Earth and move elsewhere—like Mars to start with. He is putting his money where his mouth is. 

It isn’t the future we are discussing here, but it is a force that is already in motion, and one our minds aren’t willing to buy into yet. Its implications are beginning to make themselves felt, and are a cause of concern for me. It was driven home harder still.

By way of example, to get over the so-called “pain", I felt compelled to use Rs1,500 left over in my cart. I kept an eye on deals. By now, Amazon knows I like gadgets that can keep track of personal metrics. And voila, a “Lightning Deal" came up and showed a tangerine-coloured Fitbit Surge for Rs12,500. That is half the sticker price of Rs24,500. Even though I don’t like the colour tangerine and don’t need a FitBit because there is nothing the device has that my phone can’t track, a “deal is a deal". 

Just when I thought I’d go for it, I spotted the same device, albeit with a blue strap and a larger dial, at the same price. Bingo. This was it. I tried to move the blue one into the cart and move the tangerine version out. The algorithms declined and emptied my shopping cart. This is what transpired. 

I cribbed.

And waited with much anticipation. Nothing dramatic followed by way of apology or offer to make up for the lapse. The critters remained unmoved. Instead, my friend Rajat, a doctor in sport medicine, suggested I stop gadget hunting and get out running, while another friend, Achuyt, who is a geek, just smiled and shrugged his shoulders at the inevitable.

How does Amazon control me?

The good news is, I didn’t give in, declined to buy the device, gave up and got on with life—but not before having expended most of the sale hours trying to spot the so-called “lightning deals". 

The next day, the much-anticipated Fire Stick arrived. Since then, though, the missus and girls hijacked it. The three of them take turns to watch what gets their fancy at any given point in time. Cable television has conceded ground to this contraption. I’m still to get around to watch anything I want to.

The long and short of it is that by throwing in a so-called incentive of Rs1,500 at me, Amazon has gotten into my life. It now knows intimately all who live at home, what they watch and when they watch it, and, over time, it will build a profile of my family of the kind no entity can. As the girls grow up and the wife moves around, it will target them, and me, with exactly the kind of things we want to hear. And buy. 

For Rs1,500, I traded my family to an entity that aspires to be a digital monopoly. Ought it be curbed? I haven’t heard a single voice crib yet about whether it amounts to an intrusion of privacy. Instead, all I hear are the raving voices of fans on what a fantastic business model the company has and how people like Jeff Bezos are changing the world. Indeed, they are.

Charles Assisi is co-founder and director, Founding Fuel.

His Twitter handle is @c_assisi

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