Amazon sellers battle the giant’s algorithm-based policy- and decision-making

“Their algorithms are garbage,” said Lesley Hensell Demond, partner in Riverbend Consulting, a firm that helps Amazon sellers overcome a host of challenges, including account de-activation and loss of ASINs (a kind of ISBN number Amazon assigns to products. Riverbend is heavily staffed by former Amazon employees.

There was a lot of discussion about Amazon’s algorithms at the AMZ Innovate event for Amazon sellers in New York City this week. The reason: Amazon sellers are deeply invested in a platform which is essentially too big to be held accountable. They’re at the mercy of policy-making and enforcement which can seem capricious or even be downright mystifying.

Hensell Demond offered a grim tour around the problems sellers can face. Amazon attempts to exert control over pricing decisions by third-party sellers. If, for example, it sees a product from a seller listed at a lower price on a competitor website, it will enforce a price reduction. Because the process is automated (those algorithms), it’s not uncommon for Amazon to confuse a “pack of one,” say, with a “pack of three.” If Amazon believes it detects systematic over-pricing, more penalties can follow.

And then there’s the reported practice of simply copying a successful product and putting Amazon branding on it. According to Hensell Demond it has even been known for Amazon to approach the manufacturer and offer to place a larger order than the successful seller.

Sellers and aggregators

The event, put together by Jared Orkin, VP of Product Strategy at Adbeat and an Amazon and Shopify expert, and Brandon Furhmann, a successful Amazon Seller with his own Kitchenware Brand, did not just attract sellers. Also there were the partners who offer services for sellers: PickFu, the consumer research vendor, and GETIDA, an Amazon auditing service, for example.

Also present were a number of aggregators like Thrasio and Boosted. These companies are in the business of acquiring and growing FBA (fulfilled by Amazon) sellers — developing symbiotic portfolios of businesses that allow cross-selling and cross-promoting. Keith Richman, co-founder of Boosted, painted almost as bleak a picture of the space as Hensell Demond, but not without a ray of sunshine.

Online advertising is getting more expensive and difficult, he said. There’s no end in sight to the supply chain crisis. It’s really hard to hire talent right now. Amazon’s policy making and rule enforcement is hopelessy inconsistent. Sellers are under constant threat of being de-listed. And yes, success means the risk of being copied by Amazon, or indeed by other sellers. “Why is everything so hard?” he asked.

Things might be hard at present, but Richman also painted a rosy picture of the future. Massive changes are underway, he said, in digital shopping habits, fueled in part by social media. Consumers are open to trying new brands as never before. Established companies often lack the agility to respond to these changes. “This is just the beginning,” he said.

PPC, coupons and keywords

This mixture of horror and hope set the backdrop for much more granular explorations of how sellers can simply push their products to the top of Amazon’s search results. Casey Gauss, VP of SEO at Thrasio (a college dropout and self-taught programmer) came armed with actionable advice.

To get the prized Amazon Best Seller badge, for example, consider switching your product from its existing category to a sub-category where you can beat the competition. Purse a “big coupon” strategy, offering significant percentage or price discounts for a limited time, then gradually phasing them out (25% off for two weeks, then 15% off, and so on). Refresh your keywords regularly. Invest in PPC campaigns.

Most importantly, said Gauss, do all these things together. You might only be making “micro-improvements,” but your listing in the search results will be headed in the right direction.

Living with a giant

The event felt like a tribe of Davids all trying to make peace with the giant Goliath. Slaying the giant is not an option. They’re angry at many things the giant does, but they’re also fascinated by his quirks, needs and moodswings. We commented to Furhmann that the relationship between Amazon sellers and Amazon looked not unlike the relationship between search marketers and Google. He agreed.

“All these big tech companies are the same,” he said. Rather than devoting adequate human resources to executing policy, “they trust the algorithms — and the algorithms make really bad decisions.” It’s not just Amazon, he said. The same complaint could be levied against Facebook and Google.

“That’s where the frustration springs from.”

About The Author

Kim Davis

Kim Davis is the Editorial Director of MarTech. Born in London, but a New Yorker for over two decades, Kim started covering enterprise software ten years ago. His experience encompasses SaaS for the enterprise, digital- ad data-driven urban planning, and applications of SaaS, digital technology, and data in the marketing space. He first wrote about marketing technology as editor of Haymarket’s The Hub, a dedicated marketing tech website, which subsequently became a channel on the established direct marketing brand DMN. Kim joined DMN proper in 2016, as a senior editor, becoming Executive Editor, then Editor-in-Chief a position he held until January 2020. Prior to working in tech journalism, Kim was Associate Editor at a New York Times hyper-local news site, The Local: East Village, and has previously worked as an editor of an academic publication, and as a music journalist. He has written hundreds of New York restaurant reviews for a personal blog, and has been an occasional guest contributor to Eater.