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Amazon Account Suspension

Should new Amazon Sellers be flipping products from deal sites?

August 5, 2019 1 Comment

Flipping products such as cheap or free inventory is tempting, but carries significant risk

By Lesley Hensell

 

It seemed like the ideal way to get started selling on Amazon – flipping deeply discounted or free products purchased right on Amazon itself! But this tempting method of sourcing can lead to disaster.

buying or flipping product graphic text

 

“I went to those deal sites online,” my client said during our intake call about his account suspension. “They have huge discounts for products listed on Amazon. So, I would buy the items and then flip them. The margins were amazing. Some stuff I bought had a discount of 90 percent or was even free.”

My client visited sites like Vipon, JumpSend and SnagShout, where Amazon private-label (PL) sellers post deals to drive sales and improve their Best Seller Rank. After buying the goods (or getting them for free), he listed them on Amazon.

As one might imagine, this had the immediate effect of angering the affected PL sellers. These PL sellers had brand registry, and they had also filed IP complaints. Lots of them. My seller ended up suspended.

In other cases, I’ve seen PL sellers perform test buys and claim the products are counterfeit, inauthentic, or used sold as new. They have left terrible, sticky feedback and complained to Amazon endlessly.

Try to understand the situation from the PL sellers’ perspectives.
They sell at huge discounts to launch their products – not to create competition on their very own listings! (We are talking about how such massive discounts violate Amazon policy, but that’s a topic for another day.)

As a result, the old phrase “too good to be true” comes to mind. These “deals” are too good to be true, if you’re planning to resell them on Amazon.

What should a new Amazon seller do instead? Every sourcing method carries expense and risk, but there are many alternatives that are safer – if not as profitable. Buy from wholesalers, distributors or local manufacturers. Even retail arbitrage and online arbitrage – which carry quite a bit of risk and are not a great long-term strategy – are less risky than buying from deal sites and incurring the wrath of PL sellers.

Have questions about the health of your account? Call Riverbend Consulting 877-289-1017.

Lesley is Partner at Riverbend Consulting, she offers practical know-how to improve retail performance. Lesley’s  experience with Amazon compliance gets accounts back up fast.

Filed Under: Account Health, Amazon, General, Inventory Sourcing, Private Label, Quality Control, Seller Performance, Vendor Tagged With: Amazon, Amazon Account Reinstatement, Amazon Account Suspension, Inventory, Inventory Flips

Rebates are Risky – and often against Amazon Terms of Service

July 22, 2019 2 Comments

By Lesley Hensell 

Whether you’re manually providing rebates via PayPal or using a rebate service, Amazon has the technology to find what you’re doing – and deactivate your account.

When private-label sellers launch new products, they look for any way to get an edge. For many years, rebates have been a popular option in the seller community. But now, two factors are coming together to make this incredibly risky. First, services have launched to offer rebates in a hands-off manner. Secondly, at the same time, Amazon has become increasingly aggressive about finding and suspending accounts using this technique.

What’s a rebate?
Typically, sellers initiate rebates so they can improve their best seller rank or gain product reviews:

  1. Using Facebook groups, ads or mailing lists, they ask for a purchase of their product. When the purchase has been made, the buyer sends an email asking for the rebate, along with proof of purchase. They are paid via PayPal.
  2. Sellers create an account with an online rebate service, specifying the product they need pushed and fully funding a specific number of rebates. Buyers purchase the products listed on the service and then apply for their rebate, which is paid out by the third party.

In recent months, we’ve heard repeatedly that these services have “spoken to legal” at Amazon, and that they are operating within Terms of Service.

Sorry, folks. These services – as well as direct PayPal rebates – are almost always a blatant violation of Amazon’s rules for sellers. The written regulations say:

Misuse of sales rank:
The best seller rank feature allows buyers to evaluate the popularity of a product. Any attempt to manipulate sales rank is prohibited. You cannot solicit or knowingly accept fake or fraudulent orders, including placing orders for your own products. You cannot provide compensation to buyers for purchasing your products or provide claim codes to buyers for the purpose of inflating sales rank.

Not convinced? Check out this language under “Inappropriate product reviews”:

The following are examples of prohibited activities. This is not an all-inclusive list.

  • A seller offers a third party a financial reward, discount, or other compensation in exchange for a review on their product or their competitor’s product. This includes services that sell customer reviews and websites or social media groups with implicit or explicit agreements or expectations that an incentive is contingent on customers leaving a review.
  • A seller offers to provide a refund or reimbursement after the buyer writes a review (including reimbursement via a non-Amazon payment method).

Some proponents of rebate services argue that there is no request for a product review on their web sites. If they are offering rebates themselves via PayPal, they can point out that their emails never even mention the word “review.”

This is still problematic, in two ways:

  1. With the wording above, Amazon can easily argue that there is an implicit request for a review based on this financial incentive.
  2. Amazon is now aggressively enforcing against accounts for misuse of Search and Browse. This includes “Artificially simulating customer traffic (through Internet bots, paying for clicks on organic search results, etc.).” Obviously, giving people free products is an artificial stimulation of customer traffic.

Wrong again.
Proponents of rebates who are not convinced by the policy language above then typically argue that Amazon can’t detect this particular policy violation. Wrong again. Amazon can uncover data patterns among buyers. In other words, the same set of buyers are seeking out rebate deals across multiple products, and it becomes obvious that their purchases are not organic. In addition, Amazon has managed to track buyers in Facebook groups, who also share a common purchase history.

Are there times that rebates can be considered kosher? Maybe. If you’re a brand owner, rebates could be used as a normal part of doing business, if and only if:

  1. The rebate amounts are 25% of the product’s value or less.
  2. There is absolutely no request – explicit or implied – for a review or feedback.

Our best recommendation? Just don’t do it. Using rebates is fraught with peril. Our clients who were suspended for this activity typically only received a limited number of purchases and a handful of reviews. The risk definitely isn’t worth the minor reward. Instead, rely on PPC and coupons. Both work well to drive traffic, without the risk.

Still not convinced? Know this. Amazon has adopted a two-strikes-you’re-out policy for platform manipulation. Do it once, and you can get reactivated. Do it twice, and your time on the platform is over – permanently. Private-label sellers simply cannot afford to lose their branded accounts.

Finally…
If you’re currently using a review service, visit their web site. Notice that there are no familiar names of people on the site – even though the owners of these businesses are well-known in the seller community. There is no readily available contact information. There’s a good reason for that. We’ll discuss it further in our next blog.

If you’ve been suspended for platform manipulation, we are here to help! Contact Riverbend Consulting, and let us review your marketing materials, create a plan, and get your account back up and running.


Lesley is Partner at Riverbend Consulting, she offers practical know-how to improve retail performance. Lesley’s  experience with Amazon compliance gets accounts back up fast.

Filed Under: Account Health, Amazon Tagged With: Amazon, Amazon Account Suspension, Amazon seller, Amazon Seller Account, Paypal, Private Label, Rebates, Riverbend

No, Virginia, there isn’t a 30-day grace period before Amazon suspension.

July 17, 2019 Leave a Comment

The updated Business Solutions Agreement may signal minor operational changes like a “grace period”, but Risk Management still prevails.

By Lesley Hensell

This week, Amazon announced changes to the Amazon Services Business Solutions Agreement. This is essentially the “terms of service” under which third-party sellers operate. Almost immediately, many in the Amazon seller community began hailing the changes as a 30-day “grace period” before account suspension. I’m here to tell you – that simply is not what the new agreement says.

A review of the red-lined version reveals these changes:

  1. Amazon has upped its game for account verification. No longer can you simply sign up or provide only a driver’s license/passport and utility bill. Amazon now says you must provide “any other information we may request.” Takeaway? They are making it much harder to establish the kind of duplicate/second accounts that so many sellers have created in the past.
  2. Amazon will give you 30 days’ notice before terminating your “use of services” or Business Solutions Agreement. Sounds nice, right? But if you read a little more, Amazon gives itself every possible out. They can suspend or terminate your use of any services immediately for:
    • Material breach of the BSA. That is about as broad as it gets.
    • Failure to cure within seven days of a cure notice. In other words, if you get a warning in performance notifications, and you don’t fix it, you’re done. This is already the standard for many suspensions.
    • You exposed Amazon to liability toward a third party. That could mean a rights owner/brand owner who filed an IP claim, anyone complaining about fake merchandise, product liability issues, customers not receiving orders, etc.
    • Your account has been or “may be used” for deceptive, fraudulent or illegal activity. Again, this can include so many things: inauthentic merchandise, counterfeit merchandise, not shipping products, platform manipulation, fake reviews and more. If you don’t have pristine invoices that Amazon accepts, you fall into this bucket.
    • You have harmed or “might harm” other sellers, customers, or “Amazon’s legitimate interests.” Again, this is terribly broad. Amazon could claim that ANY seller “might harm” Amazon’s legitimate interests.
  3. Amazon will tell you about suspension or termination, including the reason and any options to appeal. Amazon already does this.
  4. Amazon will not tell you the reason for suspension or termination if they believe it will “hinder the investigation or prevention of deceptive, fraudulent, or illegal activity, or will enable you to circumvent our safeguards.” In other words, Amazon is not going to provide information that will put its risk management practices in jeopardy.
  5. Amazon retains the right to halt any of your transactions, prevent or restrict access to services, or take any other action to restrict access or availability of any inaccurate listing, any inappropriately categorized items, any unlawful items, or any items otherwise prohibited.
  6. You have 30 days to appeal A-to-z claims.
  7. The language for FBA reimbursements has changed from “reimburse” to “compensate.” In other words, they will decide how much you deserve to be paid for your inventory – not you. This has always been the case. Now it’s in writing.
  8. Amazon can immediately dispose of your inventory if they decide it is a safety risk, or a liability risk; if you engaged in fraudulent or illegal activity; or if Amazon terminated your account and is exposed to liability. In other words, if you cannot prove the inventory is valid and authentic, they can throw it away. Right now. Amazon has always had the right to destroy inventory they believed was risky. Again, nothing has changed.
  9. You have 30 days to appeal customer returns that you think were made in error.
  10. Everything in the prior agreement regarding MWS has been replaced with language about the API. I haven’t analyzed this and will take more time to read it later. It’s long and complex.

So, as you can see, Amazon still retains all of the power.

Why? Risk management. Amazon must control the platform to prevent fraud and abuse. Will Amazon’s SOP change? Maybe a little. They might edit some emails or timeframes as well.

But overall, very little will change. It’s still Amazon’s platform. Don’t fall for the “grace period.” And no, Virginia, it’s not a kinder, gentler platform.

Concerned about other Amazon pit-falls call Riverbend Consulting 877-289-1017.

Lesley is Partner at Riverbend Consulting, she offers practical know-how to improve retail performance. Lesley’s experience with Amazon compliance gets accounts back up fast.

 

Filed Under: Fulfillment, General, Private Label, Seller Performance, Vendor Tagged With: Amazon, Amazon Account Suspension, Amazon seller, Amazon Seller Account

Your super old suspended Amazon account can be reinstated

November 21, 2017 Leave a Comment

Can your very old suspended Amazon account be reinstated? Yes!

By:  Lesley Hensell

How old is too old? When it comes to suspended Amazon seller accounts, quality is definitely more important than the number of years passed.

Recently, we got a client’s account reinstated 6 years after his suspension. Surprisingly, it took just one letter to Seller Performance, and he was back in business.If you have a languishing third-party seller account that is important to you, we suggest the following:

  1. Make sure you still have the correct login information. In some cases, sellers have forgotten and misplaced the email address associated with the account. This makes reinstatement virtually impossible.
  2. Comb through your email accounts and find any correspondence from Amazon relating to the account suspension. Keep in mind that most of the critical data in your account – even performance notifications – is no longer visible.
  3. Search your memory. Reconstruct the hows and whys of your account suspension. You need to be able to tell a compelling story including the reasons for the suspension, what you did to address the problems, and how you will ensure they never happen again.
  4. Hire a pro. For this particular kind of suspension, hiring a professional can be critical. You might only have one shot to convince Amazon when so much time already has passed.

If you have an old Amazon account that is important to you, contact us at Riverbend Consulting. We can try to get that account back on track.

Lesley is Partner at Riverbend Consulting, she offers practical know-how to improve retail performance. Lesley’s experience with Amazon compliance gets accounts back up fast.

Filed Under: Account Health, Amazon, General, Seller Central, Seller Performance Tagged With: Amazon, Amazon Account Reinstatement, Amazon Account Suspension, Amazon reinstatement, Amazon suspension, Amazon third-party seller

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