Online retailers slide as Amazon reportedly testing recommendation service

Shares of several retailers and online personal shopping services are slipping in afternoon trading after CNBC reported that Amazon (AMZN) is testing a new on-site recommendation service known as Scout. WHAT'S NEW: CNBC reported that Amazon is testing a new service called Scout, a shopping site for consumers who don't know specifically what they want to buy but are willing to take some automated recommendations. Scout asks shoppers to like or dislike a product and responds by showing other products based on user responses, according to CNBC. Scout is currently available for home furniture, kitchen and dining products, women's shoes, home decor, patio furniture, lighting and bedding, with more categories coming soon. "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 said in an emailed statement. "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 NOTABLE: The CNBC report noted that Amazon is utilizing machine learning technology to address one of the major criticisms of its service, namely that it's a great place to buy things but not a great place to browse. While Amazon is easily the biggest U.S. e-commerce company, e-retailers such as Stitch Fix (SFIX) and Walmart's (WMT) Bonobos provide a more personalized experience and have given social media services such as Instagram (FB) and Pinterest more room to use their large collections of data in turning their networks into fledgling commerce sites, CNBC said. PRICE ACTION: Following the news, Wayfair (W) slipped 4.3%, Williams-Sonoma (WSM) fell 1.9%, Stitch Fix dropped nearly 9%, and Steven Madden (SHOO) slid 1.3%. Meanwhile, Amazon (AMZN) shares are 1.5% lower in afternoon trading.