March 21, 2019
A new Amazon rule pressures vendors to sell profitable products.
According to CNBC, Amazon has been telling vendors and brand owners that if they don’t sell products at a profit, they won’t be able to promote those products. CNBC learned of this new rule from conversations with vendors and the emails they received from Amazon.
One of the emails CNBC obtained said that vendors must lower the cost of their products to become eligible for advertising again.
Vendors are not pleased with the new rule, and they are particularly unhappy with the lack of guidance when it comes to the steps they have to make to be qualified for advertising.
“The data and notifications that brands get are very minimal,” said one vendor to CNBC.
A spokesperson for Amazon defends the new rule, saying the change is a common practice done by many retailers.
“Like all retailers, Amazon decides which products to market and promote in our stores based on a variety of factors, such as relevancy, availability, profitability and other factors,” the spokesperson said to CNBC.
Although the new rule targets vendors that advertise on Amazon’s platform, it does not affect third-party merchants.