Top 5 Amazon News for May 2022
Each month, we monitor Amazon news and updates to seize opportunities as well as to avoid potential problems before they become an issue for us and our clients.
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Here we share the top updates and news for May 2022:
1. Update to US FBA fulfilment fees starts April 28
Amazon announcement:
“Since the start of the pandemic, we have significantly invested in Amazon’s store and fulfillment operations to better support you and our customers. We’ve nearly doubled fulfillment capacity, added over 750,000 full- and part-time roles, and our average hourly wage in the US has climbed from $15 to $18. These investments enabled tremendous growth for sellers, who have increased sales in our store by more than 70% during this time. (…)
In 2022, we expected a return to normally as COVID-19 restrictions around the world eased, but fuel prices and inflation have presented further challenges. It’s still unclear if these inflationary costs will go up or down, or for how long they will persist. Rather than a permanent fee change, we will be employing a fuel and inflation surcharge for the first time—a mechanism broadly used across supply chain providers.
Beginning April 28, we will implement a fuel and inflation surcharge of 5% on top of our current Fulfillment by Amazon (FBA) fulfillment fee per-unit rates. We know that changing fees affects your business. Our teams are working each and every day to ensure that FBA remains a great value for the premium fulfillment and delivery service it provide.”
ProMerit Tip: If you’re in the FBA program, you should be aware of this 5% rate increase over the FBA fee on your products before it takes you by surprise. We’ve already been working on this for some weeks, measuring its impact for all our clients and each of their SKUs.
2. New brand analytics Search Dashboards are now available
Amazon announcement:
“We have launched two new Brand Analytics search dashboards, Search Catalog Performance and Search Query Performance. These two new dashboards give you new views into your customers’ shopping funnels and the top queries relevant to your brand.
The Search Catalog Performance dashboard provides a comprehensive product view of key shopping metrics such as impressions, clicks, cart adds, and purchases. The end-to-end shopping behavior data helps you diagnose sales funnel issues. The behavior and demand data combination helps you improve your catalog quality.
The Search Query Performance dashboard answers the question, “what queries led customers to my product?” and includes Brand and ASIN level performance for each query.”
ProMerit Tip: This information will help us optimize listings and paid media campaigns, through a better understanding of the sales funnel and the customers’ behaviour.
With the detailed information from the catalog’s performance and the term’s performance dashboards, it is possible to detect exactly on which stage of the funnel we should focus to improve our sales and listing strategy.
3. FBA: US small and light price threshold to increase to $10
Amazon announcement:
“We’re pleased to tell you that FBA Small and Light will increase the price threshold for eligible products from $8 to $10, effective April 28, 2022.
This change allows more of your products to become eligible for the program and receive fulfillment discounts. Other program eligibility requirements, such as weight limits and product dimensions, will remain the same.
Small and Light offers reduced fulfillment costs on qualified items, helping you sell more of your low-cost products to the hundreds of millions of Amazon customers who shop in our stores around the world.”
ProMerit Tip: How does this affect sellers? By lowering the sale price by $1 USD (from $10.99 USD to $9.99 USD), the FBA fee can drop from $4.5 USD to $2.66 USD, increasing the net saving by $0.84 USD per unit.
That’s why you should consider dropping your price to increase sales and margin.
4. New storage type: Extra-large
Amazon announcement:
“Effective April 18, 2022, we’re offering another storage type, extra-large, in addition to the oversize storage type. This new storage type gives you more flexibility in how you manage your inventory and quantity limits for larger items.
Your FBA quantity limits will be determined separately for extra-large items and oversize items. This determination will be based on your past and forecasted sales, adjusted by fulfillment center capacity.
If you have existing inventory that qualifies for the extra-large storage type, this inventory will be reclassified automatically as extra-large. No action from you is required.”
ProMerit Tip: Furniture manufacturers, this piece of news is important for you. As you may know, the oversize category was considered for products of 18 inches or more (longest side), 14 inches or more (median side), 8 inches or more (shortest side) and 20 lb. or more for unit weight.
And now, this new storage type (extra-large) will affect products of 96 inches or more for non-TV items, 40 inches or more for TVs (longest side), 130 inches or more (girth and length) and 50 lb. or more (unit weight).
5. Should I get started with Amazon DSP?
Amazon announcement:
“Amazon DSP: Your brand in new places
Amazon DSP is a demand-side platform that allows you to programmatically buy ads to reach new and existing audiences on and off Amazon.
- Meet them where they are: Use exclusive insights and shopping signals to connect with the most relevant audiences on and off Amazon.
- Make metrics-based decisions: Plan your marketing strategy with insights and measure results with performance reporting, available at no additional cost.
- Reach your goals: From manual site reviews to real-time bid evaluations, we take action to uphold quality standards and brand safety.”
Link to Amazon DSP product video: https://www.youtube.com/watch?v=ImiFcfBbebQ
ProMerit Tip: Amazon Demand Side Platform (DSP) is not a new program, but it has been growing lately. Its use is becoming more and more relevant for SMEs. We are launching our first trials, so results will come in some weeks!
An important thing to consider before deciding to start using it is the budget required as it demands a $10,000 USD to $15,000 USD monthly investment. It also requires going through an Amazon approved agency, which also charges a fee.
There are many possibilities. The main advantages are:
a. Detailed targeting & retargeting: It makes possible to target specific groups and offer highly efficient retargeting. You can use your website’s pixels to target your website’s clients.
b. The Amazon DSP allows you to create link-in and link-out campaigns. The core difference between these is the campaign’s destination. Link-in campaigns drive traffic to an Amazon destination, directing customers to a brand’s product detail page, store or campaign landing page. Link-out campaigns direct customers to a non-Amazon destination, such as a brand’s website (only certain campaigns may be approved for link-out). As an example, car manufacturers that can’t sell on Amazon, can now target Amazon clients.
c. Advertisers can leverage display, video and mobile ad types, as well as creative types such as:
- Display ads with e-commerce creative
- Image ads
- Video ads
- Video creative builder ad units
- Third-party served ads
Display ads can be created with the help of Amazon’s templates and video ads with the video creative builder, or advertisers can also create them on their own.
We hope this article is helpful for your businesses. Please note that the above announcements have been sourced from Amazon’s official channels as well as from some well-known business blogs.
If you have any questions related to our services, please contact us. Remember to sign up for our newsletter to receive more exciting news every month!
