Amazon Slashing Commission Rates On April 21

Joined
Nov 18, 2016
Messages
74
Likes
63
Points
0
Something just crossed my mind....

We've seen a reaction from one of the big sharks (Amazon) , how do you think Google will react to what's going on?

I'm looking at it from different angles :

- Covid-19 has changed the way people search , how and where web traffic is distributed.

- Ad prices are falling and they'll very likely miss earnings projections for this year.

- Amazon commission saga means Affiliate publishers are gonna look for other ways to make money , mostly likely start using Ads. Adsense seems to be losing out as people are dumping them for other ad networks.

With all that is going on , do you see them tweaking the algorithm to sway things in their favour?

I wouldn't be surprised to see a huge and very weird core algo update in the coming weeks and maybe post covid-19.
 
Joined
Aug 27, 2018
Messages
71
Likes
65
Points
0
brb developing businessandpersonalchecksandcontactlenses.co

Does anyone have experience with Wal-Mart? Curious to know how it stacks up with Amazon, especially for conversions. I've never ordered from Wal-Mart's website but I order from Amazon multiple times per week, so I don't really have any first hand experience from a customer's POV.

Either way, seems like a good time to add Wal-Mart next to my Amazon links for "Where to buy:"
I actually did this with one of my big item sites about 3 years ago so conversion rates could have changed dramatically since then but I remember for my category walmart had a product that was a bit better and $800 usd to amazons version of it for $900. I did the switch for a month and saw sales drop by 50%. I was shocked and never tried walmart again.

Also just googled and saw this on AH blog
 
Joined
Sep 3, 2015
Messages
423
Likes
196
Points
1
Have tried Walmart also and the results were piss poor v Amazon.
 
Joined
Mar 19, 2019
Messages
112
Likes
92
Points
0
I would imagine that over time consumer habits will change and people will begin to purchase from Walmart, etc at a higher rate as many affiliate websites make the switch to other programs. Part of the reason Amazon is at the top is due to consumer trust. If other companies start to gain some more consumer trust, people will begin to diversify their spending habits, thus leading to higher conversion rates.
 
Joined
Jan 13, 2017
Messages
74
Likes
30
Points
0
Yeah this seems like a miscalculation. Sure, they're renting Hurtz trucks and absorbing that cost just to get packages out, and sure, they're planning on hiring some 75,000 new workers to deal with newfound demand, and sure, they've essentially achieved monopoly status as America's go-to ecommerce one stop shop. Toss in an economic recession and you have a company keen to take every penny of available cashflow and invest it into capacity expansion. Makes sense I guess..

All that said, 1% is for suckers, so people WILL be finding alternatives. For so many queries Amazon, while only ranking their property for 1 or 2 spots, absolutely dominate first pages in terms of affiliates acting as surrogates.

But if all the other 8-9 first page results start promoting other peoples programs.. that is a MASSIVE hit... just think of all the buyer pre-purchase intent keywords and long-tails affiliates...
 
Joined
Mar 28, 2019
Messages
62
Likes
57
Points
0
I think some are being overly optimistic here, both about people switching to alternative sellers now Amazon gets too big, and about Amazon really taking a hit when affiliates switch to alternative programs. The whole point of becoming a monopolist like Amazon is that you can do all these shitty things and get away with it.

They've become so big that I can only see two things making a difference: A. Government intervention/breakup due to being a monopoly, or B. Company mismanagement/too much profit seeking, which gradually decreases people's trust in Amazon, opening space for competitors.

I don't see A happening anytime soon (even though Trump hates Bezos), and B is something that happens over the course of years and even decades, not a few months. Any other trajectory is most likely wishful thinking, and people should get used to getting pushed around by Amazon, because that's how monopolies work.
 
Joined
Mar 1, 2020
Messages
22
Likes
19
Points
0
Admittedly I'm new to the game and have only just started building my business but have but have been following this since it started getting posted over at /juststart.

To me, this is just the risk associated with being an affiliate - we will always be playing somebody else's game - it's their ball and their rules which they can change whenever they want. It's no different to Google changing the algo causing your site to drop. It's just another sign that you should never put all your eggs in one basket.

To me the argument about switching to Walmart is the same as saying switch to Bing if your site tanked in the Google rankings.
 

CCarter

King of America
Staff member
BuSo Pro
Boot Camp
Digital Strategist
Joined
Sep 15, 2014
Messages
2,834
Likes
6,266
Points
7
It takes 5 mins of going to Walmart.com and browsing around to realize that place isn’t going to cut it.

They aren’t known for high quality produces either, so you’ll only get the lower end consumers to “maybe”, but doubtable, attempt to purchase there.

High-end and luxury products - never going to happen at Walmart. Their whole premise was “lower prices” for 2 decades in their marketing. They can’t undo that. So if you are an affiliate selling a highend good consumers aren’t likely to consider the Walmart brand.

The Bing analogy is dead on.
 
Joined
Dec 2, 2014
Messages
171
Likes
381
Points
1
I doubt Amazon even lowered it for ALL affiliates, I'm sure the big ones that drive a ton of value are still getting paid.

Frankly, the majority of SEO affiliates are delusional about their market position here. People come to your site to figure out what product to buy on Amazon already, why does Amazon need to pay you more? The vast majority of people are not going to take a suggestion of another site, they just want to know what to buy on Amazon. Many affiliates are just getting in between a sale Amazon was going to make anyways.

The sites that actually direct buying intent, I'd bet they still have good rates. Do you think Amazon wants SlickDeals.net to stop posting any links to Amazon? Now there is an affiliate that is actually providing NEW business to Amazon.

You SEOs should just do what we in paid traffic did many years ago. Don't get for 3% or even 8%, find someone selling the product for 3x as much and get 70% commission. Yes your conversion rates will be way down, but getting one sale that is worth so much more (70% of $100 say instead of 8% of 35) can easily make up for it.
 

CCarter

King of America
Staff member
BuSo Pro
Boot Camp
Digital Strategist
Joined
Sep 15, 2014
Messages
2,834
Likes
6,266
Points
7
Many affiliates are just getting in between a sale Amazon was going to make anyways.
I never understood why Amazon was giving credit to stuff that was added to the cart after the direct linked item from the affiliate site.

I stated several times here that it didn’t smell right and eventually Amazon was going to cut that off.

I have this strange feeling that’s next on the chopping block.
 
  • Like
Reactions: Boy
Joined
Aug 27, 2018
Messages
71
Likes
65
Points
0
Here's a statistic for you 62% of American households have Amazon prime. At this point a lot of people are just doing window shopping on sites to go ahead and buy it on Amazon to get the faster delivery and no delivery fee. right now creating an Amazon affiliate site is a completely dead art after this update. The cost to create content and back links versus the reward now is just not there. I personally was lucky that I only had a small percentage of my portfolio hit. but even after the lower profits now you have to wonder when they're going to eliminate the program altogether.

I saw a very interesting comparison that basically says that Amazon eight years ago at its 8% commission would be earning you less than Amazon today at its avg 3% commission because of all of the buying and conversion rate increases their platform has now as the biggest e-commerce retailer. So actually thinking about that makes me reminisce and think did we really just get spoiled by Amazon and now the hammers coming down.

MJ DeMarco has some good lessons in his book the fast lane. If you have something that is not giving value or providing a new product to the marketplace you are in the slow lane and will be punished for it eventually. Focus on making a product that has a affiliate program rather than being an affiliate.

this affiliate change may be great for smaller e-commerce stores because all those top 10 best guide results are in Google are now going to be filtering over to smaller e-commerce stores raising the competition.
 

infotech

To each his own
Joined
Dec 28, 2016
Messages
93
Likes
48
Points
0
Does anyone have experience with Wal-Mart? Curious to know how it stacks up with Amazon, especially for conversions.
I used walmart they had tied up with Rakuten for affiliate program. For unknown reason they didn't accept me again when they switched to Impact.

In my experience, Target converted a lot better than Walmart but they both converted less than amazon.
 

Cash Builder

BuSo Pro
Joined
Jan 14, 2017
Messages
369
Likes
450
Points
2
Interesting how they slash commission rates for everyone and then bring back tiered commission levels. Looks like they are rewarding the highest-earning affiliates, which makes sense from their point of view. It's easier to manage a smaller number of high earners, rather than millions of low earning affiliates.

Here is the link to the new UK commission levels - https://affiliate-program.amazon.co.uk/help/operating/schedule

It's only a 1% increase for higher tiers, but if you got shunted down to a 1% category that's still doubling your revenue.
 
Joined
Aug 20, 2019
Messages
12
Likes
3
Points
0
im switch to drop shipping with single products, dumb to promote amazon rightnow, or you can build amazon associate website for adsense, or build an ecommerce website and link from your reviews articles to your eCommerce.
 
Joined
Jul 30, 2015
Messages
25
Likes
21
Points
0
Yet another lesson that building your business around another entity is a poor long-term play.

I've been guilty of it in the past--building up social media channels to distribute content was huge in the early 2010s and even going into 2017. I lots of money and invested heavily back into those channels to grow them. Then it got hit and organic reach on pages and IG profiles took a massive downturn.

And overnight the traffic on my sites dropped 90%. The only thing that even kept them viable was email--which is a much more "independent/ownable" marketing channel. But of course even then you are in the hands of an ESP.

The takeaway?

Build a brand. Something people want. Something they need.

So when big companies inevitably make shifts to further their own bottom line (AKA why the hell would Amazon keep paying high commissions when more and more people go to them in the first place to buy something? And in my case why the hell would facebook or instagram keep sending people off of their platform to my site instead of keeping them on their own platform and continuing to feed them ads?) you are prepared and have your own marketing channels established.