FTC vs. Amazon: Lawsuit highlights manipulative user interface designs
FTC vs. Amazon: Lawsuit highlights manipulative user interface designs
The U.S. Federal Trade Commission alleges that Amazon used deceptive tactics to steer users towards Prime subscription renewals
How many clicks are simply too many when it comes to disconnecting from a service? This is the question that seems to lie at the heart of the lawsuit filed by the U.S. Federal Trade Commission (FTC) against Amazon last week. The lawsuit serves as a battleground against the ongoing efforts of technology companies to utilize every possible cognitive bias in order to influence our decision-making.
According to the FTC's allegations, Amazon has violated the Federal Trade Commission Act and the Online Consumer Trust Restoration Act by employing "dark patterns" or deceptive design tactics aimed at steering users towards a specific choice—specifically, to either sign up or decline the cancellation of the Prime service ($14.99 per month or $139 per year). The complaint states that Amazon has "utilized manipulative user interface designs, coercion, or misdirection... to mislead consumers into signing up for automatic Prime renewals," and intentionally complicated the cancellation process, adding that making it easier for users to cancel their Prime subscriptions would have negatively impacted Amazon's profits.
In the lawsuit, it is stated that Amazon employed six different "manipulative designs." Among other tactics, they intentionally complicated the process with unnecessary steps, redirected users away from the cancellation path using inconspicuous links, obscured relevant information, and used phrasing that guided users towards the desired option.
The FTC found that Amazon purposefully prolonged the cancellation process to frustrate its customers. What used to require one or two actions has now turned into a "four-page cancellation process, six clicks, and 15 options in recent years," while signing up for Prime only takes one or two clicks. The situation is even worse on the mobile app. Additionally, the FTC notes that although customers can sign up for the service through various methods and platforms, such as television or Prime Video, they cannot disconnect using the same methods. Unsurprisingly, as stated in the lawsuit, the company's management referred to the cancellation process as "The Iliad," alluding to Homer's epic poem consisting of 24 books, symbolizing the long and arduous story of the Trojan War. "Amazon designed the cancellation process to be a maze, and Amazon and its management hindered or delayed changes in the user experience to make 'The Iliad' simpler for consumers because those changes adversely affected Amazon's bottom line."
Although Amazon agreed to simplify the cancellation process in July 2022 after facing enforcement action from European authorities, the company responded to the FTC's allegations by stating that they are "misrepresentations of the facts and law" and that they provide clear and transparent instructions to customers on how to sign up for or cancel Prime subscriptions. Amazon is not alone in criticizing the lawsuit within the United States. Some question why regulators would intervene in the number of clicks required to terminate a service. Who is truly bothered by this process? After all, Amazon consistently receives high reliability ratings in industry surveys. Does the FTC not have more important matters to address than determining how many clicks are too many?
1. Intentional consumer failure
Under the leadership of Lina Khan, the FTC proposes a different approach to imposing limitations on businesses: a dynamic approach that aims to adapt to the world of technology giants. One area of focus is the issue of "dark patterns"—sophisticated design methods used to manipulate consumers into making purchases, sacrificing their privacy, sharing data, or subscribing to services.
In September of last year, the FTC published a report that outlined various strategies employed by companies. These strategies include displaying advertisements designed to resemble organic content, utilizing countdown timers to create a sense of urgency for consumers, diverting consumers from the cancellation process through the use of options and links, obscuring certain aspects of price disclosure, and employing default settings that push consumers to provide more personal information.
While these methods are predominantly used by companies operating in the online consumer sector, they are part of a larger effort within the internet-related business sphere to optimize their pages, websites, and interfaces in order to retain customers. Examples of such practices can be found across various platforms and products. Twitter employs infinite scrolling on its pages, YouTube automatically plays videos based on algorithms that generate high user engagement, Microsoft repeatedly prompts users of its Windows operating system to complete their "computer settings" as a means of upselling complementary products, and Instagram frequently encourages users to synchronize their contact lists within the app.
Despite the prevalence of these practices, enforcement in this area has been limited. In December, computer gaming company Epic Games was required to pay $245 million to settle a lawsuit regarding the use of these methods in the game Fortnite, and telecommunications company AT&T also paid $105 million for employing these tactics.
2. Consumer accolades suddenly cease
In his 2018 annual letter to shareholders, Amazon founder Jeff Bezos commended the company's customers for their divine dissatisfaction, stating that their unceasing demands have driven Amazon's continuous improvement. It's as if the customers themselves are raising the bar and compelling Amazon to constantly elevate its standards.
This description aligns perfectly with the company's well-known strategy of being customer-obsessed, which entails creating a consumer world where every purchase is a seamless and highly efficient process at every step. From placing orders (which can be done through voice commands with the assistance of the virtual assistant Alexa) to swift doorstep delivery and hassle-free returns. However, the praise for consumers abruptly comes to a halt when they wish to discontinue their patronage. One-click purchasing, but a six-step cancellation process.
Amazon does not have the right to complicate the departure process, intentionally obfuscate it, or employ deceptive tactics to retain paying subscribers. The inherent power and information asymmetry between service providers and consumers impose a clear and unequivocal responsibility on the former to facilitate the cancellation process, even if it contradicts their financial incentives to retain as many paying subscribers as possible. Simply counting clicks, subjectively labeling the process as "easy," or gauging the time it takes for a technologically savvy individual to cancel the service does not absolve Amazon of this fundamental responsibility.
