Amazon enforcement changed dramatically in 2024. In my decade-plus of helping sellers with Amazon challenges, I’ve never seen a year like this one. Here are the three top trends that affected and afflicted Amazon sellers and vendors.
1. Killing the idea of the “Everything Store.”
Under Jeff Bezos, Amazon believed selection was important. It was a key corporate value. Buyers should be able to find anything and everything on the Amazon platform. In fact, broad selection was a motivator for creating the third-party Marketplace. Only via a wide network of sellers could Amazon be the Everything Store that Jeff envisioned.
Under Andy Jassy, this ethos has changed completely. We can see it in enforcement actions, programs, interactions with sellers, choices about the vendor program, and more. Upper management at Amazon is willing to sacrifice selection. Here’s the kicker, though. No one can figure out why.
Among Riverbend consultants and experts, the view is that Amazon is cutting off its nose to spite its face. There is little to gain by destroying selection. Sure, there are reasons to stop the sale of generic products and low-quality items with high return rates. But that’s not what we are seeing. Amazon is choosing to end relationships with solid vendors, block brands from the platform if they refuse to be 1P, destroy fast-selling and popular bundles, and refuse second chances to hot brands that make minor errors, such as variation violations and more.
This should upset all sellers and vendors. Selection is what draws buyers to Amazon – and benefits us all. Jassy doesn’t get it. And Jassy doesn’t value sellers the way Jeff did before him. That is clearer than ever when you see the next two trends below.
2. More zero tolerance, fewer second chances.
Amazon has always been the land of second chances for sellers and vendors. And frankly, that is the most reasonable approach to enforcement.
In the past, the company knew it had to allow for mistakes to be made – as long as the seller involved was willing to learn what went wrong, correct their errors, and move forward following the rules. After all, the platform has hundreds of regulations. There are potential pitfalls lurking at every turn. And Amazon has, historically, welcomed inexperienced, new sellers and micro businesses. Sellers and vendors don’t instantly understand all of the rules. Mistakes are made.
In 2024, some suspension types changed. Rather than allowing for second chances and course corrections, Amazon Seller Performance began demanding that sellers prove they never broke the rules in the first place. We call these “dispute-only appeals.”
This is happening most frequently in suspensions for Restricted Products. This is where Amazon determines that a product:
- Cannot be sold on Amazon because of high risk (think tasers)
- Cannot be sold on Amazon because of federal, state or local law (think CBD or medical equipment)
- Makes disallowed medical or health claims
Front-line Seller Performance team members will simply not reinstate under these circumstances. Only aggressive executive escalations have any hope of overcoming these suspensions.
And keep in mind, this doesn’t just apply to newer sellers. Amazon is willing to cut out even well-performing, generally compliant sellers with zero recourse – if they make the wrong mistake.
What did we learn? Sellers – even newbies and those with long, healthy track records – cannot afford to accidentally list even one product that is not allowed by Amazon. Audit your catalog frequently.
3. Squeezing more dollars out of sellers.
Fees have skyrocketed for sellers in 2024. In the past, Amazon would introduce maybe one new fee in a calendar year, hoping to not upset the delicate seller ecosystem.
This year was different. Amazon put fees in place that are frankly laughable. They also punish sellers for Amazon’s own poor decisions, while also demanding that sellers have better inventory management capabilities than Amazon – arguably the world’s leading logistics company.
Of course, we can talk about the inventory placement fee or the jacked-up fourth quarter fees. But the most maddening of all fees is the low inventory fee. Why?
- Sellers are punished with high storage fees if they accidentally overstock a product.
- Yet these same sellers are punished with a low inventory fee if the product sells more quickly than expected.
Have you ever noticed that Amazon has both overstocked products and stock-outs? Yes, they do! Yet sellers are somehow supposed to do better – or pay for it.
But that’s not all. Amazon also dramatically shrunk the window for reimbursements requests. In the past, sellers had 18 months to ask for a refund when Amazon lost or damaged their inventory. That fell to just 60 days this fall. The carrot? Amazon claims it will provide reimbursements automatically. Sellers don’t have to open cases. Ahem. If you believe that? I’ve got a bridge to sell you. Keep working your reimbursements – or have someone like Riverbend do it for you. Amazon wants to keep your money and pad their bottom line.
Another recent squeeze is Amazon’s dictate toward many 1P vendors. Amazon is telling them to go 3P or go away. Why? Amazon wants to squeeze out more fees and have less strain on its decimated staff of vendor managers. Those 1P vendors not being forced into 3P are seeing their co-op fees rise dramatically as well.
The good news? Amazon announced no new fees for 2025. Sellers who figured out how to make money under 2024’s aggressive fee structure should be profitabe in 2025 too, hopefully with fewer surprises.
So, what do we think will happen in 2025?
We’ve been reading the tea leaves. Here is what we think you can expect in 2025.
1. Even worse “help” from Seller Support, Account Health, and any other Amazon department that is supposed to assist sellers.
First it was layoffs in 2023. Amazon laid off more than 27,000 employees. Then, in February 2023, Amazon announced its Return to Office (RTO) initiatives, which would begin in May. This past September, Amazon upped its RTO requirement to work in the office for five days a week. From the beginning, we saw these as silent reductions in force (RIFs). If you make it uncomfortable or impossible for an employee to do their job – and they leave – did that person quit? Or was it a silent RIF? Regardless, it’s a life-changing pivot for employees who were allowed to move to where there were no Amazon offices. Many employees live and work hours away from Amazon locations, and now they must commute five days a week. One ex-Amazonian we know says they had to travel four hours a day to work in the office. Crazy.
Why does this matter? In January 2025, more Amazonians will choose to leave their jobs rather than move so they can return to an office. After all, why sit on a Zoom meeting in a cubicle rather than from the comfort of your own home? So much talent has already fled Amazon. Expect thousands more experienced people to flee, leaving Amazon even more ill-equipped to solve sellers’ problems.
The silver lining? Companies like Riverbend are already scooping up more of Amazon’s elite ex-employees. So, vendors like us can solve problems for sellers – even when Amazon itself cannot.
2. More USA sellers are adding Walmart and TikTok Shops to their portfolio, with few joining Temu or Shein.
Walmart and TikTok Shops are working hard to lure sellers. Both are investing heavily in their own versions of FBA. Both are advertising and marketing like crazy to draw in buyers.
We are already seeing a strong uptick in clients who have diversified by adding these platforms alongside their Amazon businesses. This provides some much-needed diversification, as well as opportunities for brands to proactively market to new audiences.
In our 2024 seller survey, we learned that sellers are on multiple platforms, as shown. It’s an interesting, surprising mix, especially with TikTok and the emergence of Shein and TEMU.
- 52%, eBay
- 44%, Walmart
- 29%, Facebook Marketplace
- 20%, TikTok Shops
- 2.5%, Shein
- 2.5% TEMU
With Walmart, sellers enjoy the experience. Walmart has adopted many of Amazon’s old policies that worked well for the selling community. This is helping Walmart grow, and sellers benefit from the kind of hands-on, useful support that Amazon offered long ago. We don’t expect sellers to replace Amazon with one of these alternative platforms. For most, that would never make sense. But they may choose to reallocate resources, depending upon their success with Walmart or TikTok Shops, or others.
Despite their efforts to draw in sellers with low or no fees, Temu and Shein are unlikely to attract many U.S.-based companies. It’s just too hard to compete on price with the Chinese sellers on these platforms – even when fees are waived.
3. Does the FTC lawsuit go away? And does regulation drop under a new Trump Administration?
Enforcement at Amazon swings like a pendulum. Sometimes, Seller Performance backs off and lets sellers sell. Then suddenly, there will be a rash of enforcement, gatings and more. This has been a trend for years upon years.
Which begs the question – after a 2024 that was extreme in terms of enforcements, will the pendulum swing toward a more free-wheeling platform under the Trump Administration? We hope so. Let me explain.
Enforcement rolls downhill. When the federal government issues repetitive consent decrees and ratchets up legal threats against Amazon, the platform has no choice but to initiate more enforcement on sellers. When the EPA complains about “pesticide claims,” sellers have listings down and have to take a class. When the FDA complains that saying “relieves cold symptoms” is a medical claim, Amazon takes down listings. There are countless examples.
The incoming presidential administration has pledged to decrease regulation. Will that easing up of red tape also ease up enforcement against good sellers for nonsense? Will it spell the end of “dispute-only” appeals? Will it mean more second and third chances? We can only hope so, and that Amazon reads the regulatory room.
Going back to the beginning of this piece, an easing of enforcement would also help Amazon return to its Everything Store roots, which would be good for everyone.
The real wild card? That would be the antitrust lawsuit against Amazon. I would bet a favorable settlement will be in the offing sooner rather than later.
