Amazon's warehouse location determines the ranking, and many sellers are completely panicked! !

When this news came out, some sellers were happy while others were worried, which means that sellers with different inventory amounts will naturally have different traffic.

Some sellers have more inventory and some goods in each area, so they will get more natural traffic, but sellers with less goods and uneven distribution will see a decline in natural traffic.

Previously, Amazon’s algorithm might calculate the weight based on your store’s sales, ratings, praise rate, or other factors. Now, if your products are available in an FBA warehouse near the buyer, your products will be displayed first. It is not difficult to see that Amazon should have taken the storage location into account and it accounts for a large proportion.

As Amazon's logistics costs decrease, sellers' logistics costs should also decrease. Previously, Amazon sent all orders from one warehouse regardless of where the buyer placed the order. Now it seems that this logistics method has too high transportation costs!

According to Udit Madan, Amazon's data shows that the faster the delivery, the more likely the buyer is to shop again. This also shows that Amazon's core focus in this change is still on the buyer . Previously, Amazon was passing on the logistics costs to the buyer, canceling home delivery and giving the buyer a $10 self-pickup fee. Although it is reducing costs and increasing efficiency, the ultimate temptation of shortened delivery time + $10 is there, so why don't Amazon buyers follow Amazon?

According to NANA analysis, there are actually many reasons behind Amazon's series of big moves!

In addition to Amazon's growth pressure coming from its own content problems, some emerging forces in China cannot be ignored .

Recently, young Americans have been particularly fond of Chinese e-commerce platforms. In March 2023, in the US App Store program rankings, the overseas version of PDD Temu ranked first, and the fast fashion cross-border e-commerce Shein ranked fourth.

Amazon in 2021 probably wouldn't have thought that a mere independent website could compete with it. Shein is like a scourge, from an unknown "independent clothing seller" to a "global fast fashion cross-border e-commerce" with a valuation of hundreds of billions. In 2022, Shein's revenue reached US$22.7 billion, a year-on-year increase of 52.8%. It is expected to double to US$58.5 billion by 2025, which will exceed the combined annual sales of H&M and Zara, in contrast to Amazon's shrinking and slowing growth.

More importantly, as the scale continues to expand, Shein's platform actions are also accelerating. This means that Shein will form a business model similar to Amazon, that is, self-operated + third-party platform. That's why Amazon has such a big move.

Coincidentally, Temu, like a sudden comer, has snatched away the "low-price business" of Amazon and all independent sites.

Since its launch, it has been a huge success with its absolute low price advantage, and it has also sponsored the American Super Bowl. In less than half a year, it has achieved the excellent result of "daily sales of over 10,000 for a single product, and daily sales of over 30,000 for a single store."

It is obvious that Temu has snatched away Amazon's low-price tag. Now that Amazon no longer has the "low-price" tag, consumer loss is also a very big problem.

So everyone can understand the reasons why Amazon adopts the plan of giving $10 for self-pickup and the plan of nearby delivery.

However, Amazon's new delivery mechanism looks familiar. Isn't it similar to domestic JD.com and Taobao? It follows the principle of local delivery and nearby delivery.

The previous article mentioned that Amazon’s search rules have changed →_→ <Amazon has made major changes to its search rules to focus on supporting small and medium-sized sellers! >.

Not only will there be keyword-based segmentation options below the search box, but you can also customize your preferred price range.

These two options are available on Taobao and JD.com in China. The "nearest delivery principle" that appears now is similar to the concept of Taobao's "shipping place" . However, there are many differences between Taobao and Taobao.

In recent years, the average price per click of Amazon ads has been rising, and the platform has been constantly improving, such as adding some new ad slots and changing the broad matching rules. In fact, the sellers' traffic demand is getting bigger and bigger, and Amazon's ad slots are so limited, which is in a state of supply exceeding demand. From the side, we can also see that because the number of sellers on the platform is increasing and the traffic distribution is uneven, simply adding a few rows of ad slots and changing the matching rules cannot meet the sellers' traffic needs.

If Amazon does not change the structure of its platform pages, for example, by recommending products from many sellers like Taobao’s personalized recommendation page, it will not be able to solve the fundamental problem of seller traffic. So NANA might as well make a bold guess: will Amazon develop towards "Taobao-like" in the future?

In the future, the traffic of Amazon platform will continue to rise, and the volume of sellers will not decrease. Although there have been many account suspension and review actions recently, they only removed a batch of accounts with authenticity and operation problems. In the future, there will be more and more compliant sellers, and the authenticity of the accounts will become better. The problem of fierce competition will not be alleviated, but will pressure sellers to carefully arrange their products. The platform hopes that sellers will develop in the direction of high-quality products, and at the same time, it will not forget to pass on the increased labor costs to the sellers hahahahaha.

Now that the peak season is approaching, the rules of the Amazon platform are unpredictable. Sellers can band together to help each other. Our core Damai Circle is such a place where top sellers in the cross-border industry discuss the next way to survive.