Time for the weekly recap of Amazon news! It's always good to keep up with events related to the fast-moving world of the Amazon ecosystem. I select the most important news updates to share with subscribers each week, which you can sign up to receive right here.
Amazon to share seller information with Massachusetts
Amazon has agreed to disclose the identities of Fulfillment by Amazon (FBA) sellers with inventory in Massachusetts to the Massachusetts Department of Revenue. Massachusetts will conceivably use this information to determine which sellers should be collecting and remitting sales tax, and take action against them. This follows a trend whereby Amazon has begun complying with States’ actions to collect tax revenue from FBA sellers.
Amazon is collecting tax on Washington state marketplace sales this year. Similar laws are expected to be brought in by Pennsylvania and New York.
Amazon increases fees in clothing & accessories category, but lowers fees for jewelry sellers
Amazon is raising fees for its apparel and accessories category to 17%, up from 15%. However, a lower fee model will be applied to the jewelry category for a period of a year.
Here are the implications, from my perspective:
- Amazon's year-long fee reduction within the jewelry category is a play to increase selection in this category and encourage new & existing sellers to list more products. Amazon has employed this same strategy in the past for categories that it has a strategic focus on, most recently including the Grocery & Gourmet Food category shortly after the Whole Foods acquisition.
- Increasing the referral fee for clothing and accessory products seems to be a double-sided move. While Amazon has made big moves recently to be a more significant player in the fashion category, it is a complex and costly category to administer. Product return rates are high, and Amazon is making more of an investment to merchandise and market this category to users. As such, they may be looking to offset some marketing and operational costs with this change.
The rise of Amazon-only brands
This blog post by Marketplace Pulse, spurred by a WSJ article about an ‘Amazon-only’ brand, poses some interesting questions about the future of brands in the Amazon age. Amazon-native brands are built to leverage the key strengths Amazon offers. They don’t work with distributors or retailers and use Amazon’s data to determine which products to offer, at what price and at what feature set. Their only sales, marketing, and distribution channel is Amazon. These brands are rising in number and can be pretty successful.
The author poses that instead of brands building their own identity, Amazon themselves are the brand that consumers are buying - the ultimate ‘umbrella’ brand. I don’t entirely agree that national brands are irrelevant in today’s age or moving forward, but you can definitely see a shift in behavior for many consumer purchases which are no longer driven by brand.
Where Amazon PPC Fits In The Consumer Buying Lifecycle
In my most recent article on the Bobsled Marketing blog, I talk about how brands should view their paid search options as they fit into the options offered by Facebook, Google, and Amazon. For a long time, Facebook & Google have dominated the paid search space, but advertisers have a new option toward the transactional end of the purchase funnel. Learn how Amazon PPC fits into the consumer lifecycle, and why no single channel is a silver bullet for driving brand awareness and sales.
This is all the news I have to share with you this week. Stay tuned for my next update!