Amazon's New Scout Business Sends Wayfair's Stock Lower

E-commerce giant Amazon.com, Inc. AMZN's new business Scout appears to be a direct competitor to the online furniture retailer Wayfair Inc W.

What Happened

Amazon's Scout business shows furniture products that shoppers can "like" or "dislike" based on their preferences and new products are prompted based on prior choices, according to CNBC. The business has products for sale within home furniture, kitchen and dining products, shoes and home decor, with more categories to come.

Amazon is making use of machine learning technology to improve on one of the biggest complaints about its site: that it's not a platform to browse products, CNBC said.

Wayfair's stock responded to the downside and was down 2.95 percent at $139.03 at the close Wednesday. 

Why It's Important

"This is a new way to shop, allowing customers to browse millions of items and quickly refine the selection based solely on visual attributes," an Amazon spokesperson told CNBC. "Amazon uses imagery from across its robust selection to extract thousands of visual attributes for showing customers a variety of items so they can select their preferences as they go."

What's Next

Amazon has yet to promote its new page, and it's intended to "free people from the need to use words to describe what they're looking for" when shopping in highly visual categories like furniture.

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