Amazon Year in Review with Kevin King and Steve Simonson

Let’s take a look at Amazon’s highs and lows as we end 2019! Joining us today are Kevin King and Steve Simonson, as we look back and discuss what has changed and what this means for 2020. Predictions, anyone?

Background

  • Kevin King launched the first Billion Dollar Summit and the event will be available to the public by 2020.

2019: The Trump Tariffs

  • In September 2018, Trump issued the first tariff and threatened to launch the second installment in 2019.
  • The continuous threats created an uncertainty for a lot of businesses in the US.
  • People have learned to optimize in these period:
    • Optimizing HS codes is legal.
    • Like if the product has percentages of mixed materials then some people choose the HS codes that best fits the product or choose the category with lower tariff rates.
  • Phase 1 Trade Deals between China and US: The first round got postponed and the second round is reduced to 7%.
  • Phase two will include some more roll backs too.
    • But there is quid pro quo coming from both sides.
    • China is financially distressed right now. There are factories flying over and looking for business.
    • There is a certain level of uncertainty inside China.
    • There are a lot of things happening to the supply chain.
    • 2019 has been a huge impact and will probably be a source of some annoyance.

Tips for Sellers Sourcing from China

  • Make sure you have an idea of the market price, look also to other countries like Cambodia.
  • Volume matters – this is for medium to large sellers.

A Review of Changes in 2019

  • Amazon started making data available to brands: reporting, demographics and buy in program.
  • ASIN targetting and demographic information has been made available.
    • Not so technical people had problems using the data to their advantage.
  • There were a lot of good changes.
  • You can download the customer information: name and address but Amazon has now taken that away.
  • States have started collecting taxes on Amazon transactions depending on the situs or nexus of the transactions.
  • Governments are now investigating Amazon on how powerful they can be, the expanse of their monopoly and if rules are being broken or unfairly hurt consumers and interstate trades.

The 2019 Amazon Course Fever

  • Everyone’s got a course – because a lot of people figured out that Amazon is not the beach life dream, and some people took advantage.
  • We encouraged the seller tools to make the Amazon courses free like Helium10 users can access these for free, Viral Launch and Jungle Scout followed suit. 
  • Now we have a free education platform as part of subscribing to the tools.
  • People should use these free platforms – if you are buying a course DO NOT SUBSCRIBE or buy courses that say passive income. 

The 2019 – The Rise of Rebates

  • The huge thing for next year is a rebate company is on talks with partnering with Amazon. 
  •  Rebates have been around for a long time but can be abused.
  • If it pushes through then there may be a change in the algorithm because rebates is another form of manipulation tool.
    • Amazon page 1 may become a pay-to-play, in 2 to 3 years.

Amazon by 2020

  • Amazon’s most vulnerable part: recruiting overseas. Without realizing that the middlemen sellers understand the culture, the language, the people– in short the consumer versus factories.
  • Vetting China factories getting seller accounts should be more rigorous in order to reduce the black hat tactics.
  • Amazon is not yet aware how much they are losing on black hats and how unvetted sellers lower the business’ goodwill.
  • Amazon will continue to grow.
  • PPC will be a requirement for medium to large sellers to be competitive.
  • It will be a pay per play.

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