Overpriced Instant Pot Seals Provide An Amazon Economics Lesson

The yogurt tasted like mushroom risotto. That wasn’t my intention. But in making sure future batches turned out sweet rather than savory, I wound up tumbling down a rabbit hole of the unintended consequences of e-commerce, potential goods of various origins, and Amazon Marketplace’s pricing engine before I managed to set it right.

I was the recipient of a holiday gift of an Instant Pot from my wife—who we call the “early rejecter” around the household—after she heard me talking endlessly last fall about the hottest kitchen product of the last couple of years. While the Instant Pot can make complicated meals in one go using pressure cooking and other settings, I started with easier tasks that are often a pain when handled manually: hummus and yogurt.

I quickly learned after making a mushroom risotto that the removable silicone seal that’s part of Instant Pot’s pressure-cooking process retains flavors rather intensely. Fortunately, yogurt with a heady sense of mushroom risotto works well as a Greek-style chicken marinade. But I set out to get additional seals I could mark “sweet” and “savory,” on the advice of veteran pressure-cooker enthusiasts.

On Amazon, I quickly found an Instant Pot-branded “genuine” set of two seals, one red and one blue for easy identification. But Amazon—not a company known for price gouging—was offering the seals for over $40, versus Instant Pot’s list price of $12. Something didn’t add up.

I’d seen similar situations before. And Max Temkin, one of the people behind the hit game Cards Against Humanity, explained part of this behavior to me when I wrote a past Fast Company article about Blackbox, the shipping firm he created in part to help other creators bypass issues with Amazon and inventory.

Amazon didn’t reply to my request for comment, so it’s impossible to know for sure why it was charging more than three times the going price for Instant Pot seals. But I have my suspicions. At its warehouses, the company typically comingles items that are marked with the same stock-keeping unit (SKU), a code that should uniquely differentiate one thing from another, including items that might appear identical but could be made by different companies—such as Instant Pot’s own seals and lookalikes manufactured by other companies. (Only truly identical items should have the same SKU, but Amazon doesn’t routinely examine third-party items accepted into inventory.)

In Amazon’s search results, the original version of a product offered by its manufacturer tends to gets priority. And Amazon’s own stock purchased directly from a company—labeled as “Shipped from and sold by Amazon.com”—shows up before instances of an item offered by third-party Amazon Marketplace merchants.

A third-party merchant that lists Instant Pot seals or Cards Against Humanity decks on Amazon using the same will have its offerings show up alongside those that Amazon has acquired directly from the original seller. According to Amazon’s rules, that third party should be offering the item produced by the listed manufacturer—not a knockoff or substitute.

When Amazon runs out of stock it’s directly purchased from a company, it bumps up whatever other SKUs are in inventory, regardless of origin. In principle, the listing should state that the product is being sold by a third party, not by Amazon itself. But in practice, I and others have seen instances in which a listing states that the product is being sold by Amazon, but it’s actually fulfilled by third-party stock.

This becomes a particular issue if that third-party stock is a bootleg, as the Cards Against Humanity folks had seen routinely seen happen when their inventory sold out. Amazon has strict anti-counterfeiting policies: “It is each seller’s and supplier’s responsibility to source, sell, and fulfill only authentic products,” the company’s Marketplace guidelines note, while also explaining how the company enforces this. It has been tussling with manufacturers for years about how well they carry out this enforcement when reported by consumers and the manufacturers themselves. Elevation Labs, which had its popular headphone dock plagiarized by rogue Amazon sellers, recently said it had lost tens of thousands of dollars in sales. And it clearly continues to happen even with major brands. (Instant Pot doesn’t tend to sell parts through random third parties, which is why I have my doubts about the $40 “genuine” seals being real.)

The over-$40 price on the Instant Pot seals I saw could have been set by a third-party seller, lying in wait to take advantage of a moment when Amazon was out of seals it had bought directly from Instant Pot. There are at least three reasons why a Marketplace merchant might do so. First, people who needed the item might not realize that it was grossly overpriced and would purchase it. Next, the seals listed under the Instant Pot SKU could be counterfeit items, manufactured at a lower cost and thereby capturing an even higher profit margin than if they were genuine. Finally, forcing an overpriced item to the top of Amazon’s listing could even be a strategy to force shoppers to skim further down in the listings, where the same seller might offer correctly labeled non-branded Instant Pot parts at a lower price.

If the $40 seals were a result of a third-party seller gaming the system, it’s impossible to know who the culprit was. Browsing around on Amazon, I quickly found a similar red-and-blue set of seals for under $11 from a company called “Instant Perrrt!”—exclamation point and all. But beyond the sound-alike and look-alike nature of its offerings, it also seems to have a decent product: Its alternative seals are well-reviewed at Amazon, and review-checking sites Fakespot and ReviewMeta give those reviews very high scores as being posted by actual people. Numerous other companies also sell replacement seals at a variety of prices.

Suspicious Seals

I attempted to have a dialog with Instant Pot on this topic, but the company’s vice president of sales ultimately declined to have an on-the-record conversation about its relationship with Amazon, how it wrestles with counterfeit products, and related matters. Instant Pot has no dedicated media relations or communications staff; it’s a surprisingly small firm, given its high profile and the volume of product it sells.

But there’s another way to gauge whether high-priced or other oddball inventory isn’t the real deal: by looking at reviews posted during periods when genuine products at standard prices are apparently in short supply. The CamelCamelCamel price tracker shows seemingly the exact period in January and February when Amazon’s own inventory of Instant Pot seals ran dry. During that time, seals purchased by Amazon shoppers racked up a number of one-star reviews from verified purchasers, suggesting that they got knockoffs (I attempted to contact some of these reviewers and received no reply):

• January 29, 2018: “Did not seal correctly. Definitely not Instant Pot genuine” (Jebouck)
• February 25, 2018: “Used one ring for first time this past week. Went to insert it to make another cheesecake and it was cracked! One use!” (Jackilope)
• February 21, 2018: “This sealing ring did not fit my 6 qt instant pot as advertised. I am very disappointed in this product!” (Paulne McMackin)

A number of positive reviews came in during the same period, suggesting that some of the inventory may have been genuine or at least a competent substitute. Or maybe reviewers had received genuine items before the period in which Amazon ran out of factory-sourced seals.

Meanwhile, I turned to Instant Pot’s own site, found the two-pack of colored seals for $12 and free shipping and ordered it on February 7. When they didn’t show up quickly, I contacted customer service, but my two emails went unanswered until late in February. Finally, a customer support person replied, “We have recently implemented a new system and have been experiencing a number of unfortunate glitches.” These technical hiccups may explain the shortage at Amazon as well.

In early March, I finally received my two seals, along with a free pair of silicone potholder “mini mitts.” My yogurt since then has been as sweet as this experience was sour.