Marketplace Pulse reported that Amazon has suspended over a dozen Chinese sellers for using banned review generation tactics. The act is particularly notable due to the brands’ size: Together, their annual sales on Amazon exceed $1 billion.  

Banned Brands 

  • Atmoko 
  • Aukey 
  • Austor 
  • Homasy 
  • Homitt 
  • HOMTECH 
  • LITOM 
  • Mpow 
  • OKMEE 
  • OMORC 
  • Seneo 
  • Tacklife 
  • TopElek 
  • TRODEEM 
  • VicTsing 
  • Vtin 
  • And others 

These brands operated in multiple Amazon marketplaces and were sold by multiple sellers. Marketplace Pulse reports that some sellers were authorized third-parties, some were owned by the brands themselves, and others had unknown connections to the brands.  

Amazon banned all the sellers, making this crack down much more serious for the affected brands. If a single seller were banned, others could take their place. By banning all sellers from selling the above brands, Amazon has effectively dammed their revenue source. 

This news comes around the same time as Amazon’s first ever Brand Protection Report, which states that last year, Amazon blocked over 10 billion product listings suspected of being counterfeit.

Amazon Banned Brands for Fake Reviews 

Some of the above brands had tens of thousands of customer reviews. At the end of April, Mpow had nearly 70,000 customer reviews for one of their headphones. As of May 11th, Amazon had removed nearly 60,000 of those reviews for being fraudulent.  

Amazon has extended this practice to all the banned brands. If these brands are ever permitted to return to the marketplace, they will likely struggle to achieve the same sales velocity that they left off on.  

This act may be intended to signal that Amazon will no longer tolerate fake review schemes. Amazon chose to act against large brands, some of whom are Amazon-native brands.  

Megan Lauterbach, Kaspien’s General Manager of Retail, sees it as a pointed message: “This tells me that, regardless of how big you are on Amazon, if you violate their terms and manipulate ranks or reviews (which hurts the customer experience), Amazon is willing to remove you from the marketplace.” 

How Prevalent is Review Manipulation on Amazon? 

Unfortunately, fake customer reviews pervade Amazon, and have seemed to grow only more rampant as the years go on.  

Review manipulation is one of the most common black hat tactics on Amazon,” said Lauterbach. “It is a key way to gain more traction on the SERP. The amount and rating of the reviews gives customers confidence to purchase, even if your product is actually not great.” 

Amazon also recently retired the Amazon Early Reviewer Program, one of its few approved programs for review generation. When the news was announced, there was widespread speculation it would only lead more brands to engage in black hat tactics. 

This crack down by Amazon will hopefully deter other brands from engaging in unscrupulous practices, but given the importance of customer reviews for discoverability and conversions, brands are desperate for ways to wrack them up. 

If you’re interested in learning how to spot fake Amazon reviews, check out this blog post. 

How Does this Ban Help Stop Fake Customer Reviews? 

For one, the impacted brands are losing sales every hour that they are unavailable on Amazon. Some of them have been banned since late April.  

This suspension is also potentially disastrous from a cashflow perspective, as Kaspien’s General Manager of Dropship, Evan Durrant, points out: “If the account is banned/remains suspended, Amazon will hold funds for at least 90 days to recoup any returned product or claims made against the previous sales. In some cases (usually with IP issues), funds have been held indefinitely. All of these larger players are likely floating containers upon containers full of goods over the ocean right now, which means they now have cash tied up in inventory that they’ll additionally have to offload at-or-below cost if their suspension sticks.”

Additionally these brands may struggle to reach the same sales velocity that they enjoyed before the ban (assuming Amazon un-bans them). If the majority of the removed reviews were 5 stars, then the products may suddenly find themselves with a much lower star rating, making it harder to compete in an already intensely competitive space. 

Of course, as the image above shows, that won’t always be the case. Mpow’s headphones still have favorable ratings, despite tens of thousands of customer reviews being removed. 

What Does This Crack Down Indicate? 

“Amazon will continue to ratchet up enforcement,” said Jed Nelsen, Kaspien’s Director of Compliance. 

Nelsen also believes that this enforcement will extend to Amazon brand aggregators, which has raised over $4 billion for acquiring Amazon-focused brands since the start of 2020. “I wouldn’t be surprised if some of the brand aggregators who are violating Amazon rules – like operating the accounts of the brands they bought – will face some consequences this year. 

As for Kaspien’s partner brands, Lauterbach said, “This may benefit our partners if Amazon continues to take action. Many legitimate brands are getting beaten by competitors that are playing unfairly.  

And there’s the crux of it: Is this Amazon grand standing after facing a 16-month congressional review over the last two years, or does it truly signal a change in Amazon’s policy enforcement? 

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Amazon Pauses Prime Day in Canada and India

On May 6th, Amazon emailed sellers in Canada announcing that Amazon is pausing its plans for Prime Day 2021 due to concerns about the impact of COVID-19 in Canada. The email specifies that this disruption applies to Amazon Canada only and does not affect plans for Prime Day 2021 in the U.S.  

Bloomberg reports that Amazon has also confirmed Prime Day plans will be paused for India as well, also due to surges in COVID-19.  

Why did Amazon Pause Prime Day 2021 in Canada? 

Amazon’s announcement states that they are pausing Prime Day, “Based on the increasing impact of COVID-19 in Canada, and the importance we place on protecting the health and safety of our employees and customers, we will pause plans for Prime Day 2021 in Canada.” 

Why would Amazon Pause Prime Day 2021 in India? 

India is currently experiencing a massive surge in COVID-19 cases and deaths. On May 5, 2021, India reported a record high daily death toll, according to CNNNeedless to say, Indian consumers’ interest in shopping daily deals, as well as the logistic infrastructure needed to facilitate Prime Day, are questionable at best with far more pressing matters to attend to.  

Will Amazon Reschedule Prime Day 2021 in Canada or India? 

Amazon chose to use the word “pause” instead of “cancel,” leaving the door open for another delayed Prime Day. In 2020, Prime Day was delayed until August for India and until October for another 19 countries due to COVID-19. As such, it’s still entirely possible that Amazon could reschedule Prime Day for Canada.  

Without seeing the wording of the notification about India, it is unclear if Amazon would postpone or wholly cancel Prime Day 2021 in India. 

How Will the Delay or Cancellation Affect Amazon and Sellers? 

2020 was the first year that Amazon held Prime Day on different dates for different countries, although most countries participated on October 13-14. Prime Day 2020 far exceeded sales from previous years, despite (or more than likely, because of) COVID-19, reaching an estimated $10.4 billion in sales.  

As such, if Amazon does have to reschedule Prime Day to vary by market, there’s little reason to think it will substantially harm their sales. 

Amazon’s announcement has come early, but perhaps not early enough. FBA inventory for Prime Day was due by May 30th in India and by May 31st in Canada. Due to supply chain delays, some Amazon sellers may have already placed larger orders in order to have inventory arrive to Amazon by the end of May. Now that Prime Day is at least delayed, sellers may find themselves with too much inventory for current sales velocity, which ties up their cash flow and could put them at risk of storage fees.

That said, Amazon has limited seller warehouse space in Canada (and elsewhere) so drastically over the last 12 months that it may have actually saved sellers from sending in too much inventory. A small instance of silver linings, as it were.

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Amazon released their Q1 earnings report today. It seems that Amazon is still riding tailwinds from COVID-19, as it reported a 44% increase in net sales compared to Q1 2020. Other notable performance metrics include:  

Overview 

  • Operating cash flow increased 69% YoY for the trailing twelve months 
  • Operating income grew 122%, reaching $8.9B in Q1 2021 compared to $4B last year 
  • Amazon’s net income increased to $8.1B compared to $2.5B in Q1 2020 and $7.2B in Q4 2020 

Segments

  • North American net sales grew 40% YoY
  • International sales grew 60% YoY
  • The “Other” segment, which consists largely of Amazon advertising revenue, grew 73% YoY
  • AWS grew 32% YoY

Amazon Marketplace Highlights 

  • Third-party seller services grew 60% YoY
  • There are now more than 200M global Prime members 
  • Amazon announced “Key In-Garage Grocery Delivery” for 5,000 cities in the US 
  • Amazon Business generated $25B in worldwide annualized sales, with more than half of unit sales coming from third-party sales 
  • Amazon Air now expects to have more than 85 aircraft by the end of 2022, and has plans to launch new sites in the US and Canada this summer 
  • Amazon’s Counterfeit Crimes unit worked with several organizations to battle counterfeits, including “the U.S. National Intellectual Property Rights Coordination Center to prevent counterfeit Super Bowl LV merchandise from reaching consumers and partnering with Pennsylvania-based, family-owned card game maker Dutch Blitz and Italian luxury brand Salvatore Ferragamo to file lawsuits against multiple counterfeiters and hold them accountable to the fullest extent of the law.” 

Prime Day Confirmed for June 2021 

In Amazon’s Q2 financial guidance, Amazon notes that, “This guidance assumes that Prime Day occurs in second quarter 2021.” With July falling into the third quarter, Amazon’s Q1 earnings report does all but confirm that Prime Day will be in June this year. 

Why Would Amazon Hold Prime Day Early? 

Amazon, along with many in ecommerce, is sailing off of strong tailwinds from the global pandemic, tailwinds which first showed in Amazon’s earning reports in Q2 2020. As vaccines reach more of the globe and the rate of growth for ecommerce gradually normalizes, Amazon’s Q2 earnings for 2021 would have difficulty maintaining such as aggressive growth rates. Even growth that would be impressive any other year risk falling flat after the staggering numbers of the past year. By scheduling Prime Day for June, Amazon is able to inject a shot of adrenaline into their Q2 sales.  

Naturally, an Amazon spokesperson previously denied that earnings reports had any bearing on Prime Day’s scheduling. Even if that’s true, the benefits of the timing are fortuitous 

With Prime Day anticipated in Q2, Amazon expects net sales to grow between 24% and 30% compared to Q2 2020 

Marketplace Earnings Reviews  

Read our breakdowns of Amazon’s Q4 Earnings ReportAmazon’s Q3 Earnings ReportQ2 Earnings Report, and Q1 Earnings Report.

Want something even more comprehensive? Download the complete State of Amazon: 2021 Report!

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Competition among Amazon sellers may become more intense as Amazon escalates enforcement of their Marketplace Fair Pricing PolicyWhere once sellers faced rolled Buy Boxes, they now risk seller account suspensions or even account shutdowns. 

Pricing Flags Now Impact Seller Account Health 

Amazon recently changed their system so that products flagged as being priced too high will now appear under “Account Health Issues” instead of “Pricing Alerts” within Seller Central. This change is noteworthy because seller accounts are much more readily suspended by Amazon for having account health issues than for pricing alerts. In other words, Amazon is becoming more stringent in their enforcement of products they deem overpriced.  

Rolled Buy Boxes and Account Suspensions 

Before this update, Amazon typically removed the Buy Box from the product detail page. Sometimes referred to as a “rolled” Buy Box, this practice replaces the “Add to Cart” and “Buy Now” buttons with a “See All Buying Options” button. Rolling the Buy Box effectively requires shoppers to click at least once more before they can buy. While small, this disruption in the typical Amazon shopping experience (and the plethora of similar competitor offerings) is enough that sales can take a significant hit when the Buy Box is rolled. 

Amazon Recommends New Prices 

Products flagged by Amazon as being priced too high will display a suggested minimum price and maximum price in Seller Central. These prices would effectively serve as the thresholds for any sellers using Amazon repricer tools. Amazon also suggests what price to set for the product currently, which in some cases undercuts the price currently featured in the Buy Box. 

How Does Amazon Determine if Products are Overpriced? 

Amazon’s Fair Pricing Policy states that they will penalize sellers for pricing practices that harm customer trust, which includes suspending or terminating selling privileges. Amazon states one such harmful practice is “setting a price on a product or service that is significantly higher than recent prices offered on or off Amazon.” 

While this policy sounds reasonably straightforward, Kaspien has seen Amazon suppress listings offering a product for $31 when another seller in the listing offers it for $29. At this time, it is unclear if this degree of severity is widespread or limited.  

Ultimately, this update in enforcement practices is a win for consumers, but a complication for Amazon sellers, especially for those with already tight margins.  

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SEO is an ever-evolving part of the Amazon selling experience. Keeping content updated, engaging, keyword optimized, and compliant can be quite a balancing act. Amazon is always seeking to improve customer experience, and that includes updating content guidelines. Recentlythere’s been a change in attitude toward all caps text in bullet points and HTML in product descriptions.  

In this post, we’ll break down this recent change and why implementing these recommendations can help improve your listing compliance. 

Experiments in Style: Two-Tiered Bullet Points and Amazon SEO Optimization 

If you’re a frequent shopper on Amazon, you’ve definitely seen “Two Tiered” bullet points in product listings. “Two-Tiered” bullet points are popular choice for many sellers and are formatted like so:  

Each bullet starts with a hook in ALL CAPS to garner attention, followed by copy in sentence case that expands on the hook. 

Tests Indicated Shoppers Like “Two Tier” Formatting 

Kaspien has run many tests surrounding the efficacy of two tiered bullet points, but every result was inconclusive. In June of 2019, wsurveyed Amazon shoppers to dig in deeper into the “why” behind this formatting practiceWe found that 56% of our sample preferred a key feature format that began with ALL CAPS, and then continued in normal sentence case 

Because the majority prefer this style, we deduced that this formatting structure ia positive user experience benefitThe ALL CAPS provides the quick facts, then the trailing sentence gives more details if the shopper desires to continue reading. 

The ALL CAPS strategy really started to take off a few years ago, and Amazon SEO leaders latched onto this strategyAmazon sellers, agencies, and strategists began implementing this format in their listings to better catch buyers’ eyes. 

Amazon Bans ALL CAPS  

Unfortunately, Amazon changed their outlook on listings that contain all caps in the bullet points, notifying sellers that having all caps in the bullet structure is no longer recommended and can result in listing suppressions.  

Updating listings to reflect this change will ensure that the listings are not removed from the site for non-compliance. We believe Amazon changed their policy to present a more uniform content experience for consumers. Per Amazon’s advice, Kaspien is updating bullet points to remove any all-caps text to ensure that we meet compliance standards.  

Product Description Breakdown: New HTML Recommendations for Amazon Listings 

Product descriptions on Amazon represent an important piece of SEO territory that can be used to improve SERP (Search Engine Result Placement) for products. A robust description can be the deciding factor in a buyer’s decision, so it’s critical to include as much relevant information as possible while maintaining shopper engagement.  

Amazon product descriptions appear on the site as a plain block text that’s tucked below the fold and above the product detail section, making it easy to miss. Many Amazon content creators use HTML in their description text to help break up text blocks. Common examples of HTML formatting include creating lists and adding bold and italic text to differentiate the content. 

Amazon is now notifying sellers to remove all HTML text from the product description except for simple line breaks: <br>. Line breaks are arguably the most important HTML formatting in the product description. You can still create lists with line breaks – and of course, paragraph breaks help make lengthy text more digestible.  

We believe Amazon made this change to alleviate some of the pressure on their servers when loading a listing detail page and – similar to the changes with bullet points – promote consistent formatting to shoppers 

Moving forward, Kaspien is implementing these content updates across product listings to ensure that we meet all style and compliance guidelines. We recommend that sellers start removing HTML from product descriptions and update their bullet points to reflect Amazon’s change in listing content strategy 

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On March 18, 2021, Walmart removed requirements for sellers on its platform to have a US address or business tax identification. As a result, sellers based outside of the US can now sell on Walmart.com, assuming they receive approval 

Unlike Amazon, Walmart’s online marketplace is gated; sellers need approval from Walmart before they can start selling on the platform. Walmart will maintain these vetting procedures for new US and foreign sellers to continue to protect its marketplace from counterfeits and other undesirable goods. 

How This News Affects Sellers 

Prior to this policy update, foreign sellers could sell on the Walmart marketplace, but they were required to have a physical presence in the US, which greatly limited the number of foreign sellers able to apply to Walmart. The policy update positions Walmart to more aggressively compete with Amazon for ecommerce market share. 

Amazon has allowed non-US based sellers to operate on its US marketplace for years. In 2020, 48% of sellers on Amazon.com were from outside the US, the vast majority of whom are based out of China. Now that Walmart has opened its doors to foreign sellers, Walmart may experience a similar diversification, though it will surely take time 

Requirements for Chinese Sellers

Walmart announced the news to Chinese sellers at a conference in China on March 25th. According to Marketplace Pulse, sellers must meet the following requirements to sell on Walmart.com:

  • Valid Chinese business license
  • 1+ year of selling experience in North American marketplaces
  • Good store ratings
  • Must use Walmart Fulfillment Services

Marketplace Pulse reports that nearly one hundred China-based sellers have joined the Walmart Marketplace since the policy update.

The Future of the Walmart Marketplace

The increase in sellers means the marketplace will likely become more competitive. Product selection, prices, and advertising costs will all be affected. It’s worth noting that many foreign sellers interested in Walmart likely already have an Amazon presence. As they expand to Walmart, they will have to coordinate Walmart pricing and branding strategy with Amazon. This may lessen the impact to product pricing on Walmart. 

In the fiscal year ending January 31st, 2021, Walmart’s ecommerce sales grew 79% year-over-year (YOY)Total US sales increased 8.6% YOY and international sales grew 1% YOY. 

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I’m excited to announce that Kaspien has raised $13.5MM in equity funding from the public markets through Aegis Capital. This fundraising round comes at a pivotal point in our journey as Kaspien transitions from our “Growth” phase into our “Scale” phase. 

As CEO of a missiondriven company, I like to start my conversations with our mission statement, which is to optimize and grow brands on today’s leading online marketplaces, such as Amazon and WalmartThis funding takes us one step closer to that mission.  

Here is how Kaspien intends to deploy the newly raised funds to fuel our growth:  

1. Continue to Invest in Kaspien’s Marketplace Growth Technology Platform  

Omnichannel Distribution Infrastructure 

The future of eCommerce is digitally native brands managed through an omnichannel approach across multiple distribution channels – marketplaces such as Amazon, Walmart, Target, etc., online shops through platforms such as Shopify and WooCommerce, and brick and mortar. I look forward to the day where brands are managed in a centralized manner across various distribution channels, as opposed to the manual aggregation of performance from multiple channels.  

Although there are advantages to be gained simply by diversifying, there are even greater performance gains found in holistically managing inventory across multiple ecommerce sales channels. Why keep inventory at Walmart that’s not selling when you might run out of stock on Amazon? 

Global eCommerce Expansion 

Secondly, the future of eCommerce is global. More international brands are seeing demand for their products in the US and vice versa. The distribution problem extends beyond multiple marketplaces. Instead, it should really be called “Global Distribution Channels Online and Offline.” This is true omnichannel.   

Supply Chain Diversification 

Finally, this diversification extends beyond demand generation channels. The future of eCommerce is supply chain diversification through multiple warehousing and logistics solutions. COVID reminded the world of eCommerce that putting all your eggs in one basket is never a good idea. Amazon might restrict you, your carrier might be backlogged, a manufacturing facility might close due to a COVID case, etc. You need to be able to seamlessly shift between Amazon’s warehouses, to 3PLs, to potentially your own warehouse to keep up with the pace of demand. The future of eCommerce is managing supply demand in as real-time as possible, across distribution channels, and on a global scale 

Kaspien’s Technology Platform 

All that I’ve mentioned above is almost impossible to do (especially at scale), without the backbone of a strong technology infrastructure that utilizes the power of data, prescriptive insightsautomation, and artificial intelligence to efficiently manage the entire value chainDeciding which products to sell, managing demand through ad management tools, managing a diversified supply chain, recovering lost dollars from Amazon, managing pricing and unauthorized sellers – all of it requires a strong technology infrastructure that fuels growth and efficient operations, thereby giving you an edge in a fragmented and competitive market.  

That’s where Kaspien comes in. Kaspien’s Marketplace Growth Platform of software and techenabled services is built to help brands scale. Our platform  powered by data, insights, artificial intelligence, and automation – provides all the applications needed to run a marketplace business in a onestop shop. More importantly, it is vertically integrated across the entire value chain and fully extensible to multiple service providers, providing the only solution needed to build a global omnichannel business.  

Our platform also lends itself to network effects. The more brands we have on the platform, the more data and insights we collect; the more data and insights we collect, the more services, marketplaces, and service providers we can onboard; the more we do that, the more brands come onto the platform, and the flywheel continues, benefiting all our customers.

big part of our investment will be continuing to fuel this growth platform, making it more automated, more intelligent, and utilizing data and insights to both optimize and grow our customers’ presence on multiple marketplaces globally.  

2. Expand to a New Business Model: Brand Acquisition 

The beauty of running Kaspien’s various businesses on top of our Marketplace Growth Platform is that it gives us the economies of scale required to build next generation brands on marketplaces. Our strategy of diversification across various business models empowers us to capture more GMV and better leverage our assets for profitable and efficient growth. In 2020, we introduced three business models that sit on top of our marketplace growth platform. 

Retail as a Service: In this model, Kaspien buys inventory and sells it on marketplaces, such as Amazon, Walmart, and eBay, as a third-party seller. Additionally, we support dropship integrations with various suppliers and distributors, as well as incubate our own brands. At the end of fiscal year 2019, Kaspien had a total of 6 incubated brands: JumpOff Jo, Brilliant Bee, Big Betty, Domestic Corner, Coy Beauty, and Keto the Great 

Agency as a Service: In this model, Kaspien serves as an extension of a partner’s eCommerce team, providing full service and managed services for inventory management, marketing management, creative services, brand control, tax, compliance, and other marketplace growth services. Kaspien charges a subscription fee and receives a percentage of the revenue generated. 

Software as a Service: In this model, Kaspien provides partners access to software through its platform of proprietary technology to empower partners to self-manage their marketplace channel. Kaspien charges a subscription fee and receives a percentage of the transaction. 

Today, we’re excited to announce the fourth pillar of our strategy – brand acquisitions, once again utilizing our platform of software and techenabled services. As part of brand acquisitions, Kaspien will deploy capital to buy brands and grow them via the Kaspien platform. 

Brand Acquisition FAQs 

What’s in it for brands? 

  • We work with brands throughout their lifecycle, including helping founders exit via our brand acquisition arm. 
  • Founders/employees get to participate in the upside of a liquid stock through a public company.  
  • Employees get a new home with a company that is partner-obsessed 

What’s in it for Kaspien?

  • We make better margins when we work directly with manufacturers.  
  • We expand our selection through more SKUs and exclusivity.  
  • We acquire capabilities that we currently don’t have (e.g., new marketplaces). 

 Why is Kaspien well-positioned to acquire brands?  

  • We are Operations First. We have the tech. We have the services. We know how to optimize and grow brands on marketplaces.  
  • We are Already Working with 1,000+ Brands. We already have a pipeline. We can look into our own portfolio and bring them inhouse, thereby controlling the entire supply chain. Brands would prefer to work with someone already managing their operations. 
  • We are a Public Company with a Liquid Stock. Brand owners/employees can get access to a liquid stock and share in the upside of the business. 

3. Grow Our Subscriptions Business Even Faster, Organically and Inorganically   

In 2020, we operationalized our Subscriptions business, which includes our Agency, Managed Services, and Software segments. 2021 is about fueling that business. We’ll be adding more resources to grow the topline of the business, increasing the lifetime value of our customers while also continuing to reduce the cost to acquire new ones. In addition, we’ll acquire other service providers that complement our value proposition to brand partners.  

We’re excited about this new phase of Kaspien’s growth, and we look forward to sharing our results as we continue down this journey of optimizing and growing brands on today’s leading online marketplaces. Welcome to “Scale. 

Sincerely,  

Kunal 
CEO, Kaspien

We are proud to announce that Day Parting is now available in our Amazon campaign management software, AdManager. Day Parting enables Amazon advertisers to schedule pay-per-click (PPC) ads to run only during the days and times that deliver the best resultsThe Day Parting feature also displays performance results for multiple key metrics broken out by day and time, helping guide users’ strategy.  

AdManager is one of the only Amazon ad management applications available to offer Day Parting. Amazon’s native advertising console lacks the ability to segment performance metrics and schedule ads by time. 

Through Day Parting, advertisers can grow sales while minimizing ACOS, maximizing their Amazon marketing profitability. By displaying multiple metrics by day and time, users have the information they need to support various goals. For example, if focused on growing brand awareness, users can set ads to run during times when impressions are highest. If focused on reducing costs, users can run ads during the time that ACOS is lowestWhatever your goals, Day Parting provides the data insights needed to achieve them.

Promising Early Results from Day Parting

Six weeks since implementing Day Parting for our partners’ Amazon advertising campaigns, ACoS has decreased by 40%! This translates to an additional $6 return on every ad dollar spent – a very material impact!

We expect AdManager to drive continual improvements as it constantly intakes and acts upon Day Parting data to refine optimizations.

Kaspien Delivers Results through AdManager

Day Parting is just the latest of ongoing enhancements to AdManager. As a tech-enabled marketplace optimization platform, Kaspien is a firm believer in continual iterations. The Amazon marketplace continues to evolve, and sellers’ tools must evolve with it to meet new challenges and seize new opportunities.  

In 2020, Kaspien used AdManager to drive extraordinary results for our brand partners. 

  • 55% avg. increase in ad sales YOY  
  • 39% avg. increase in ad orders YOY 
  • 41% avg. decrease in ACOS YOY 
  • 6% avg. ACOS on over $90M ad revenue 

AdManager is available as a self-service software or as part of our Amazon advertising managed service. AdManager is provided complementary to our Retail and Agency partners’ ad campaigns. 

Why Use Day Parting for Amazon PPC? 

One of the first questions we hear asked about Day Parting is, “Why would I turn off ads? Even if the people that click the ad do not convert after clicking, the click still indicates interest. Maybe they’ll come back another day to purchase. Furthermore, the failure to convert may be attributed to poor targeting rather than time of day.” 

We understand that viewpoint. There’s logic to it. But we created and strategically use Day Parting because empirical evidence – not hypotheticals – proves that Day Parting makes Amazon ads more effective. To briefly elaborate, here are three data-backed reasons to use Day Parting:

#1 – The data shows that clicks late at night or early in the morning produce fewer sales at a higher ACOS than clicks during business hours or in the early evening.  

#2 – Second, more clicks without a purchase can ultimately reduce campaign relevancy and decrease performance over time.  

#3 – Lastly, if a brand is having trouble keeping campaigns active all day due to budget constraints, it’s much more beneficial to run ads during times when shoppers are more likely to convert to maximize their ad dollars. 

Each brand should assess the impact of Day Parting for themselves. Some may find they prefer to run ads without it. But based on what we’ve seen for our partners’ ad campaigns, we expect that most brands will enjoy better results when using Day Parting. 

How AdManager Enhances Amazon Advertising Performance 

In addition to Day Parting, AdManager offers many other competitive features for Amazon advertising. 

Dynamic Bid Optimizations 

Unlock the transformative power of tiered bid optimizations. Create custom bid management rules that can bid up or down daily at the keyword level based on any combination of performance metrics. 

Search Term Optimization 

AdManager automatically identifies and adds high-converting search terms as keywords to your campaign to ensure continued relevancy and sales. It also automatically identifies and negates poor-performing terms to minimize wasted ad spend. 

Search Term Optimization

Profitability Enhancing Budget Optimization 

Make sure your most profitable campaigns are always running. AdManager lets you set custom rules that automatically increase daily budget for high-performing campaigns if they run low, so your most profitable campaigns never turn off. 

Budget Optimization

Out of Budget Table 

AdManager also includes an Out-of-Budget table, which shows you when campaigns ran out of budget, how often they run out of budget, and the ideal budget for each campaign. 

Out of Budget Table

Campaign-Agnostic Keyword Management 

Save time and streamline campaign management using the centralized keywords table, which enables users to manage keywords across their entire portfolio in one place. 

Automated “4 Campaign Build” Creation 

Maximize data insights and improve performance using our proven “4 Campaign Build” architecture. When creating a new campaign, you can select our “4 Campaign Build” to automatically create three manual campaigns (one per match type) and one automatic campaign. 

4 Campaign Build Ad Architecture

Try AdManager for Free for 30 Days 

Try AdManager’s self-service option through a free 30-day trial, no strings attached. If you’d prefer to have Kaspien’s marketing experts manage your Amazon advertising, reach out to us here. 

Sign Up for a Free Trial


Amazon is never idle, but after a global pandemic, the ecommerce leviathan is experiencing one of its most intense growth phases yet.  

Snapshot: The State of Amazon 

  • 38% Growth 
    in annual net sales 
  • 66% Growth 
    in annual advertising revenue 
  • 1.3M 
    sellers joined Amazon in 2020 
  • 19 Countries  
    with Amazon marketplaces 
  • $3 Billion  
    invested in Amazon brand acquirers as of March 2021 
  • “S-Team” Changes 
    Jeff Bezos, Jeff Wilke, and Jeff Blackburn exit their roles 

Like what you’re seeing? Download the complete State of Amazon: 2021 Report. 

Key Updates from 2020 

Amazon Sales Soar  

Ecommerce sales reached between 14% and 21% penetration of all retail sales in 2020. US ecommerce sales grew to nearly $800 billion in 2020, accelerating ecommerce growth by over 2 years. 

Amazon was a major winner in this ecommerce growth, reporting annual net sales of $386.1 billion in 2020. Amazon’s annual net sales grew 38% year-on-year, a massive figure for a company of Amazon’s size.  

As the ecommerce titan grows, having a brand presence on Amazon is becoming less of an option and more of a necessity for brands who want to remain competitive.  

Amazon’s Competitors Ride the 2020 Wave 

Amazon’s fulfillment issues in late spring and early summer allowed competitors to secure a stronger foothold in the space, which doesn’t seem to be slowing down. WalmartTargetShopify, and more posted double-digit and triple-digit growth in 2020. Amazon still dwarfs all of its domestic ecommerce competitors, but 2021 may present the greatest challenge to its dominance seen in the last decade. 

In a survey, Kaspien found that 43% of respondents ranked Target.com as the online marketplace that they are most interested in expanding to within the next 1-2 years, followed by Walmart at 41%.  

Read our breakdown: Walmart vs Amazon 

Walmart vs Amazon: How the two companies compare

Amazon’s Share of Ecommerce Shrinks? 

Competitors’ success may have eroded Amazon’s market share in US ecommerce. According to Digital Commerce 360, Amazon’s market share diminished from 44% in 2019 to 31% in 2020. However, eMarketer reports contradicting numbers, estimating Amazon’s market share grew from 37% in 2019 to 39% in 2020. 

Whatever the reality, Amazon’s subscription service retains a comfortable lead ahead of competitors’ subscription services. A January survey by PYMNTS shows that 64% of respondents have Prime memberships, while only 21% have Walmart+ memberships. 

Amazon is irrefutably the dominant marketplace in the US, but the reduction in market share indicates that other online marketplaces are gaining steam. Brands would be wise to plan for an omnichannel approach to ecommerce for the coming years. 

Amazon Facing Antitrust Scrutiny 

Even before the global pandemic, Amazon was facing increased scrutiny from regulatory bodies. On March 2, 2020, the SHOP SAFE Act was introduced to Congress and referred to the US House Committee on the Judiciary. The act would hold Amazon and other online marketplaces accountable for counterfeits sold on their platforms.  

Jeff Bezos also testified before Congress in July of 2020, and Amazon submitted written answers to follow-up questions in September. In October, the committee published a 450-page report with their findings from a 16–month antitrust investigation recommending antitrust actions be taken. 2021 may see some of those actions introduced to Congress.  

Jeff Bezos Passes the Reins 

In addition to potential legislation, the year will also witness several major changes in Amazon leadership. Founder and CEO Jeff Bezos stated that he will step down from his role to become the Executive Chair in Q3 2021. He will be replaced by Andy Jassy, the CEO of Amazon Web Services (AWS). Jassy has been with Amazon since 1997. 

Jeff Wilke, CEO of Amazon Worldwide Consumer, also announced he would retire in Q1 2021. Wilke was replaced by Dave Clark, who has a background in operations. A third Jeff on Amazon’s senior leadership team announced his departure in February 2021. Jeff Blackburn, who served at Amazon for over 20 years, is leaving the company.  

As reported by Geekwire, Blackburn’s and Wilke’s departures will enable new CEO Andy Jassy to reshape more of the Amazon leadership team. 

Third-Party Seller Services Grow 

These changes in senior leadership suggest that Amazon will shift its focus to expanding and improving its platform instead of growing its direct retail relationships with brands. Expanding its platform would increase its value proposition for third-party sellers and advertisers operating on its marketplace, which generated $300 billion of Amazon’s $490 billion GMV in 2020, according to Marketplace Pulse 

If this is the case, all but the largest brands will be expected to sell on Amazon as their own seller or through third-party sellers. This shift has been trending for some time, with third-party seller services growing 57% year-on-year in 2020. 

Amazon also acquired a Shopify competitor called Selz in January 2021. Like Shopify, Selz serves as a central hub through which sellers can manage multiple ecommerce sales channels. Amazon’s acquisition of Selz, especially after Shopify’s stellar performance in 2020, demonstrates Amazon’s continued investment in enabling brands to represent themselves on the marketplace. 

Interested in the Unabridged Report?

Download the complete State of Amazon: 2021 Report!

Amazon Expands Advertising Services 

Amazon’s advertising revenue has been one of its fastest growing segments for the last several years. In just Q4 2020, ad revenue grew 64% year-on-year, reaching $7.95 billion! Amazon also continually expands its advertising capabilities, releasing new features and ad types to Seller Central in recent years. 

Brand Acquirers Raise $3 Billion 

Over $1 billion were invested in companies focused on buying and growing brands on Amazon in 2020. By March 2021, total funding in this space was over $3 billion. Thrasio, Perch, and Heyday practically became household names in the ecommerce industry. Taliesen Hollywood, founder of Hahnbecktold Digital Commerce 360 that brand acquirers typically pay 2.5 to 4.5 times a brand’s EBITDA. 

Consolidation is a natural part of business lifecycle in emerging industries, and it seems Amazon has finally reached that stage. The impact of brand acquirers is yet to be seen. How many will be able to successfully grow brands? Will their immense funding translate into brands becoming share leaders? How many will flounder? 

International Marketplaces 

Amazon’s international net sales grew to $104 billion in 2020, up from $75 billion in 2019. Amazon currently has 19 active marketplaces, having launched Amazon Netherlands and Amazon Sweden in 2020 and Amazon Poland in 2021. Latin America also drew much attention, growing ecommerce sales by 37% in 2020. However, the biggest winner in the region has been the online marketplace MercadoLibreaccording to Euromonitor. 

Amazon advertising also saw strong growth in international marketplaces. In 2020, Kaspien drove strong year-on-year growth in advertising sales in multiple marketplaces, including:

  • US: 55% increase YOY  
  • CA: 201% increase YOY
  • UK: 1,434% increase YOY

Winning Categories 

Certain product categories saw particularly strong sales growth in 2020 as the global pandemic influenced buying decisions. Online grocery sales soared, with eMarketer reporting 2020 sales reached $89.22 billion, an increase of $30.86 billion.  

Online grocery sales are expected to continue to climb, with estimates predicting online grocery sales will reach nearly $130 billion by 2023, accounting for nearly 10% of total grocery sales in the US. Euromonitor forecasts higher growth than eMarketer, predicting that food and drink ecommerce will expand by 8% in 2021. 

Kaspien also saw other categories benefit from the wild year. In particular, Pet Supplies, Sports & Outdoors, and Toys & Games each grew substantially. All of these categories involve entertainment and recreation, suggesting shoppers looked for respite from an exhausting year. 

Download the Complete State of Amazon Report 

We’ve only scratched the surface. Download our State of Amazon: 2021 Report to learn about other significant changes in 2020, as well as insights into what 2021 will bring. 


Amazon Ends Early Reviewer Program

Amazon Early Reviewer Program No Longer Accepting Applicants 

On March 10, 2021, Amazon Seller Support noticed sellers that the Early Reviewer Program (ERP) will no longer accept new ASINs into the program as of March 10, 2021 and that Amazon will discontinue the service completely on April 25, 2021. 

Amazon’s Notification to Sellers 

Transcribed

Hello from Amazon Selling Partner Support,  

“We understand your concern regarding the Amazon Early Reviewer Program. 

Amazon continuously innovates to improve the shopping and selling experience. Over the past several years, we have made numerous improvements to encourage purchasers to review products on Amazon. These initiatives, such as One Tap Reviews and Global Review Sharing have proven more effective in generating reviews than the Early Reviewer Program. 

Accordingly, as of March 10, 2021, we will no longer allow new enrollments in the Early Reviewer Program, and will stop offering the service to sellers currently enrolled in the program on April 25, 2021.” 

Amazon added the same message to their Early Reviewer Program FAQ page. 

Will Sellers be Refunded? 

Amazon states they will return sellers’ program fees “within three (3) months after the closure date, for any active enrollments with more than 1 review and not completed by April 25, 2021.” 

Will New Reviews Incur Charges? 

For sellers concerned about being charged for new product reviews after April 25th, Amazon states, “You will not be charged the program fee for reviews published after Early Reviewer Program closure date of April 25, 2021.” 

Why Did Amazon End the Early Reviewer Program? 

Amazon’s official reason for ending the Early Reviewer Program is that other review generating initiatives are more effective, such as One Tap Reviews and Global Review Sharing.  

Other potential factors may include the $60/ASIN fee was not financially justifiable, the amount of time it took for the Early Reviewer Program to generate reviews, and critiques that Amazon was biasing reviews by offering a small Amazon credit 

There are concerns that the retirement of the Early Reviewer Program will contribute to more black hat tactics for review generation on Amazon. 

This isn’t the first Amazon program to get the ax. In 2019, Amazon retired the Amazon Giveaways program. Similar the the Early Reviewer Program, Amazon Giveaways was a popular service among sellers and shoppers, but internal factors led the company to discontinue it anyway.

Other Ways to Generate Amazon Reviews 

Post-Purchase Emails 

On November, Amazon introduced a policy update that expressly permits sellers to email consumers through Amazon Seller Messaging after they’ve purchased your product, asking for a non-biased review. We’ve seen this approach to be a highly effective method to accumulate more, honest reviews that help products climb the search results page, all while remaining compliant with Amazon’s policies. 

Leverage Social Media & Websites 

While reviews on Amazon are ideal, many shoppers still use social media and direct websites to inform their buying decisions. Brands can use social media to engage their community, which helps motivate repeat buyers to leave reviews on Amazon. Brands can also quote reviews from Amazon and social media on their direct website to engage shoppers conducting research outside of the marketplace.

Stay Up-to-Date with Amazon Services 

We have a growing library of resources about Amazon services, including other blog posts, whitepapers, eBooks, podcasts, and more. Subscribe to our weekly blog to never miss a beat! 


Turn SEO into a Measurable Revenue Generator

Search engine optimization is an essential ingredient for success on Amazon. The problem? Attributing revenue to SEO can be tricky, and as a result, SEO doesn’t always get the attention it deserves. 

We’re hosting a new webinar about measuring how SEO impacts Amazon revenue. This is a must-watch for marketing leaders interested in Amazon.  

The webinar will be held on March 23rd at 10am PT / 1pm ET. 

5 Reasons to Attend our Amazon SEO Webinar 

1 – Learn How Much to Budget for SEO 

SEO efforts don’t require an ad budget, but that doesn’t mean it’s free. In this webinar, we’ll explain how to build an SEO team for the Amazon marketplace, including how much of your marketing budget should be devoted to SEO and critical hires. 

2 – Learn How to Measure Key SEO Metrics 

Good decisions rely on good reporting. We’ll share how to structure your metrics for reporting so you can track, measure, and act upon the most meaningful KPIs. 

3 – Industry Experts are Hosting 

Two of Kaspien’s best are hosting the webinar. In her 6 years at Kaspien, Jennifer Johnston has been pivotal in Kaspien’s mastery of SEO on the Amazon marketplace, helping build the team from the ground up. In her current role as Digital Marketing Specialist, Jenn provides marketing support of all types for critical initiatives. 

Autumn has an MBA from Gonzaga University and a background in small business consulting and digital marketing. Drawing on over 5 years of experience in traditional and ecommerce SEO, Autumn leads Kaspien’s SEO Team in servicing Kaspien’s partner brands.  

 

4 – Review Test Results and Case Studies 

Our SEO team has optimized tens of thousands of listings and conducted countless tests to determine which features have the greatest impact on product placement and conversions. In this webinar, we’ll share some of our findings, including examples of how enacting SEO best practices tangibly impacts Amazon revenue.  

5 – You’ll Get a Free Copy of our Whitepaper, The Ultimate Guide to Creating Amazon Listings 

In addition to tactical advice in the webinar, you’ll also receive a free copy of our popular whitepaper, The Ultimate Guide to Creating Amazon Listings. Authored by one of our hosts, Jenn Johnston, the whitepaper shares tips on how to write listing content for both the Amazon algorithm and the consumer, best practices backed by our tests, and a step-by-step guide to uploading listing content. 

Register for the Webinar 

Date: March 23rd at 10am PT / 1pm ET 

Duration: 60 minutes 

Kaspien Now Selling on Target Plus Marketplace

We are excited to announce that we are active on Target.com! Kaspien is one of the only third-party sellers currently approved to sell on Target.com. We are selling on Target.com as Target Plus partner. 

“The average revenue per listing on Target.com during Q4 2020 was 9x what we saw on Walmart’s marketplace.” 

What is Target Plus? 

Target Plus is a third-party company that sells and ships items directly to customers through Target.com and Target’s apps. 

Target launched the Target Plus Partner program in 2019 to thoughtfully expand their product offerings in popular categories, like home, toys, electronics, and sporting goods. Unlike other marketplaces, Target hand-picks the sellers and brands, rather than allowing any seller to list products on Target.com 

As a result, “Targets’s invite-only marketplace has less than 300 sellers, despite traffic on the website growing more than 50% last year,” according to Marketplace Pulse. Subsequentlybrands selling via approved Target Plus partners like Kaspien experience virtually no competition on this fast-growing marketplace.  

Promising Results from the Target Marketplace 

We were invited to the selective program in early 2020, and we’ve worked closely with Target Plus to confirm the brands and products approved to sell on Target.comWe have been taking a strategic approach, carefully testing each approved category for opportunities. We currently represent four brands that span 30 product listings in the baby, pets, sports and toys categories. 

“I’m extremely excited about what the initial results we’re seeing on Target.com means for our brands,” said Megan Lauterbach, General Manager of Retail at Kaspien. The average revenue per listing on Target.com during Q4 2020 was 9x what we saw on Walmart’s marketplace, an early indicator that Target will be a very meaningful platform for eligible brands in 2021. As we continue to ramp up our Target.com efforts, we have many brands that have expressed interest, and I look forward to continuing to strategically expand our catalog in partnership with Target’s product selection team.” 

As eCommerce continues to grow, so does the need for brands to diversify the platforms on which they sell. 

How to Sell on the Target Marketplace 

Because Target Plus is a gated platformpartnering with approved sellers like Kaspien is one of the most direct routes to sell products on the marketplace. In addition to gaining access to the marketplace, brands also benefit from Kaspien’s easy fulfillment solutions and marketing expertise.  

When selling products on Target Plus through Kaspien, brands ship their labeled inventory into our third-party logistics network, which packages and ships the products as orders come in. We handle all customer returns. 

We also draw on our 13 years of marketplace experience to adapt proven marketing tactics for the Target marketplace For every Target.com listing, we implement optimized listing titles and content, upload a variety of images to showcase the item, and promptly respond to shopper questions.  

Any brands that are interested in partnering with Kaspien to sell on Target.com should reach out here. However, due to Target Plus’s category restrictions and stringent requirements, brands should understand that it is only possible to onboard Target-approved products onto Target.com. 

Read the press release here.