Amazon News: The Amazon Analytics Insider July 2023
Your biweekly resource to staying informed on the news and obstacles currently affecting other vendors and sellers. Stay attuned to potential changes that might affect your business and focus on recommended reports, chosen in light of current events in order to empower your data-driven decisions.
➡️TL;DR
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Enrollment for Amazon’s “Small and Light” program ends on July 17th. The whole program itself will be replaced by a new “Low-Price FBA fee” initiative on August 29th.
Despite its suggestive name, the new program will require enrolled sellers to pay $0.30 more per item in fulfillment fees to provide customers with faster shipping.
Previously, small and lightweight items under $12 qualified for reduced FBA fees. Now, items will have to be listed at under $10 to qualify.
Small business owners who also have Prime subscriptions are now able to use those prime benefits by signing up for free Prime Business Duo plans.
Sellers express extreme frustration and disappointment upon hearing of Amazon’s “Low-Price FBA fees” Proposal which is Amazon’s newest attempt at disguising another FBA fee price hike.
Rather than lowering their prices to qualify for Amazon’s new program, many sellers state that they intend on increasing their prices due to the fact that:
Items priced at $10 would allow them virtually no profit
Items previously priced from $10-12 will have increased FBA fees. This cost must be passed down to the customer
These two reasons will most likely lead in customers turning to other cheaper Ecommerce sites.
Many sellers are reporting seeing significant increases in ad spend, with the amount being 2-7x more than their budgeted amount.
📰Amazon Updates
Amazon's changes to the site which affects brands and consumers
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Amazon increases FBA Fees (again) & Holiday Peak Fulfillment Fee Dates Revealed
Amazon’s FBA service currently offers a “Small and Light” program. This allows sellers to pay lower FBA rates for products selling at less than $12 that are small in size and relatively lightweight. Sellers with qualifying items pay slightly lower FBA fees with the only caveat being that shipping is slightly slower than those of standard FBA speeds. Amazon has ultimately decided that faster shipping is more important.
Starting August 29, 2023 the “Small and Light” program will come to an end. Taking its place will be “Low-Price FBA fees”. Previously, items listed at $12 and under would be able to qualify. Soon this amount will be lowered to items listed at $10 and under, ultimately disqualifying many sellers that currently benefit from this program.
If a product enrolled in the new “Low-Price FBA fees” and sells for $10, sellers will actually need to pay about $0.30 more per item. However items will receive more quick and consistent FBA shipping speeds.
If a product is NOT enrolled in the new “Low-Price FBA fees” sells for $10, sellers will pay about $0.77 less per item, and items will receive the same consistent FBA shipping speeds.
Items that qualify for “Low-Price FBA fees” will not be subject to 2023 holiday peak fulfillment fees which have been announced for October 15, 2023 - January 14, 2024.
Business Prime Duo to be Free for Small Business Owners
Small business owners who also have Prime subscriptions are now able to use those prime benefits by signing up for free Prime Business Duo plans. This provides them with quantity discounts, exclusive pricing, and purchasing analytics. Business Prime Duo previously used to cost $69 per year.
🎙️Local News
Former Amazonians and Experienced sellers from voicing shared concerns.
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Seller responses to Amazon’s “Low-Price FBA fees” Proposal
Sellers in the forum are incredibly upset after hearing about Amazon’s newly proposed “Low-Price FBA fees” initiative. Amazon used tricky wording in their announcement to outline this as something beneficial to sellers, when many who are currently using the “Small and Light” program will have to pay more FBA fees. Recent rises and inflation and fees have made it especially difficult for sellers to profit. The lack of correlation between listing prices and shipping times makes it clear that any potential benefit from this program was meant to disqualify as many sellers as possible.
This effort on Amazon’s part can also be interpreted as the Marketplace’s attempt on addressing other Ecommerce competitors. The newest emerging competitors are Shein and Temu, both of which offer products at a much lower price point, with 1-2 week shipping time. However, rather than try to absorb the cost of competition themselves, Amazon is trying to pass on this cost to their sellers.
However, sellers seem to be going against the grain of what Amazon actually wants them to do. In response to this post, many state that they intend to raise their prices because this new initiative will “destroy any money [they were] going to make” on new shipment being received. Sellers intend on raising prices for items listed as being more than $10 to adjust for higher FBA fees. This cost will ultimately be passed down to customers, potentially leading them to other ecommerce sites instead.
Multiple Seller Ad Campaigns Exceeding Budget
Many sellers are reporting seeing significant increases in ad spend, with the amount being 2-7x more than their budgeted amount. One seller had their daily budget set at $250, only to be charged $500 each day for two months. This applies for multiple types of advertising, being PPC and Sponsored Products.
📊Report reccomendations:
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