“You have manipulated product reviews on our site. This is against our policies. As a result, you may no longer sell on Amazon.com, and your listings have been removed from our site.”

Last August, Zac Plansky woke to find that the rifle scopes he was selling on Amazon had received 16 five-star reviews overnight. Usually, that would be a good thing, but the reviews were strange. The scope would normally get a single review a day, and many of these referred to a different scope, as if they’d been cut and pasted from elsewhere. “I didn’t know what was going on, whether it was a glitch or whether somebody was trying to mess with us,” Plansky says.

As a precaution, he reported the reviews to Amazon. Most of them vanished days later — problem solved — and Plansky reimmersed himself in the work of running a six-employee, multimillion-dollar weapons accessory business on Amazon. Then, two weeks later, the trap sprang. “You have manipulated product reviews on our site,” an email from Amazon read. “This is against our policies. As a result, you may no longer sell on Amazon.com, and your listings have been removed from our site.”

Source: Prime and Punishment

A rival had framed Plansky for buying five-star reviews, a high crime in the world of Amazon. The funds in his account were immediately frozen, and his listings were shut down. Getting his store back would take him on a surreal weeks-long journey through Amazon’s bureaucracy, one that began with the click of a button at the bottom of his suspension message that read “appeal decision.”

A quick search online and on any Amazon seller forum will reveal countless stories of Amazon account suspensions. Amazon Terms of Service are long and not always intuitive, and reasons for suspension range from the obvious (e.g., horrible customer service, multiple products sold that don’t match the Amazon listings) to the obscure.

For instance, consider the story of the seller – let’s call him Chris – who had excellent seller metrics but ended up hiring a longtime friend to help with his flourishing Amazon business. This friend had previously had her own seller account, but thought she had closed it 2 or 3 years back. However, as soon as Chris granted his friend access to his seller account (using her personal email address that apparently was still linked to her old seller account), Amazon suspended both accounts.

Chris was able to appeal Amazon’s decision, and eventually able to reopen his seller account… 40 days later.

40 days. That’s a long time to be without what for most eCommerce brands is a significant portion of their revenue.

What would it mean to you to be without your Amazon sales for 40 days?

How much revenue would you lose over the 40 days?

Chris was a smaller seller, but big enough to work his business full time and pay himself from the profits. And account suspensions aren’t limited to smaller sellers – in 2017, one of the top 10 third-party sellers in the US had to deal with account suspension.

The downsides of having one seller on your product(s) aren’t limited to the loss of revenue due to a potential account suspension.

How are Sellers Vulnerable?

As has been described here, the number of dirty tricks available to bad actors on the Amazon platform – and their use of them – has steadily increased over the last year.

Just because your brand hasn’t yet been the victim of these tactics is no reason to believe that that will not change in the future.

Here are just a few ways that sellers are vulnerable:

Seller Buys Competitor’s Products

A seller buys his competitors’ items over and over and continually reports the item to Amazon as defective or counterfeit.  Eventually, Amazon places restrictions on the sellers account and demands supplier invoices.  Amazon takes a long time to verify the invoices (or they can’t verify them at all) and the seller is out of commission for weeks.

Seller Buys Fake Reviews For Competitor’s Products

A seller hires a company to leave a huge volume of positive reviews on their competitors’ listings. Amazon then goes after the innocent competitor for fraudulent reviews.

Competitor Hijacks Your Product Listings

A brand has a competitor literally copy their products, take over their own listings for themselves (hijacking), and then claim to Amazon that THEY have the real, legitimate listing.  Some have gone as far as to register another company’s trademark as their own in Brand Registry and then do takedowns of the true rights owner.

False Complaints of Dangerous Products

An electronic product seller has a competitor that buys a product from them and then claims to Amazon that it caught on fire. Some of them have astonishing pictures of the product burning as if it was lit with gasoline.  Amazon is very quick to kill listings for safety concerns.  The innocent seller then has to show proof of certification from independent third-party testing labs to get reinstated – an expensive and time-consuming proposition.

The Vendor Central Hack

A bad actor with a Vendor Central account changes a competitor’s listing to create bad buyer experiences.  Sometimes they change the dimensions or weight of the product so suddenly the seller is paying oversize fees on a small box and losing all of their margin on a product.  Other times they change the product picture or description so that the buyer is unhappy when they get their purchase.  When a change is made through Vendor Central, Amazon considers it a “retail contribution” and it is really hard to get them to fix the listing.

Competitor Uploads Obscene Photos to Your Listings

A recent client had a bad actor that was uploading obscene and vulgar pictures to all of his listings over and over again. He’d get it fixed with Amazon and within a few hours the horrible pictures were back.  These were all through normal flat file uploads to the Amazon platform.  Amazon couldn’t catch the bad actor because these were all stealth accounts and the bad actor used a different stealth account every time they uploaded. There was no point in blocking a seller account in other words. Buyers were literally screaming at the brand (IN ALL CAPS!!!) in the product reviews.  The brand’s listings plummeted in the organic search results.  Do you think Amazon will remove these bad reviews when the problem is fixed? Of course not. They never remove product reviews if they are from legitimate buyers.  The damage is done and will keep on killing those listings.

Further Reading

From the WSJ: Amazon Fires Employee for Sharing Customer Emails

From Forbes: The New Black Hat Tactics Amazon Sellers Are Using To Take Out Their Competition

From Webretailer: Are Black Hat Sellers Winning the Battle on the Amazon Marketplace?

What is the Business Impact?

Should your brand fall victim to any of the dirty tricks mentioned above, your brand will experience any or all of the following:

Loss of Revenue Due to No Amazon Sales

This is the obvious one, and is discussed above. Getting your account reinstated can occasionally be a quick process, but usually takes days or weeks, and in some cases accounts are permanently closed.

Amazon’s judgments are so severe that its own rules have become the ultimate weapon in the constant warfare of Marketplace. Sellers devise all manner of intricate schemes to frame their rivals, as Plansky experienced. They impersonate, copy, deceive, threaten, sabotage, and even bribe Amazon employees for information on their competitors.

Source: Prime and Punishment

Loss of Revenue Due to Drop in BSR

If your account is suspended, you’re automatically out of stock of certain products. This leads not only to loss of revenue in the short term, but can lead to a significant drop in Best Seller Rank (BSR).

Even once you’re back in stock, this lower BSR can in turn lead to lower sales, generating a negative feedback loop that can be difficult to break.

You may end up having to spend a significant sum on Pay Per Click (PPC) to raise your BSR back to where it was – assuming you even can!

Plansky’s Jeff letter was never answered, but after he’d sent it, a fellow Amazon seller at a local meet-up gave him the name of someone “high up” in the company. He emailed them, and shortly afterward, he got his account back. (Stine maintains that it was the Jeff letter that did it.) All told, he estimates his suspension cost him about $150,000 in sales.

Source: Prime and Punishment

Additional Benefits of Having Two Sellers

There is no reason to have 3, 5, 10 or more sellers of your products on Amazon. In fact, the more sellers you have, the more problems you will have; however, there are some very good reasons to have two sellers.

Inventory Management

Each seller will want to maintain stock no matter how many sellers are on a listing, but if there is only one seller, it’s crucial that that seller remains in stock – otherwise, you will have again a loss of revenue due to a drop in BSR (see above).

A second seller significantly buffers against the risk of running out of stock, even if there is a small issue on the supply end.

To guarantee your products stay in stock even as sales fluctuate, the single seller will need to maintain a much higher level of safety stock. This leads to additional cash invested in excess inventory as well as higher storage fees (and in 2017 Amazon raised 4th quarter storage fees drastically, so this isn’t insignificant).

Over the following days, Harris came to realize that someone had been targeting him for almost a year, preparing an intricate trap. While he had trademarked his watch and registered his brand, Dead End Survival, with Amazon, Harris hadn’t trademarked the name of his Amazon seller account, SharpSurvival. So the interloper did just that, submitting to the patent office as evidence that he owned the goods a photo taken from Harris’ Amazon listings, including one of Harris’ own hands lighting a fire using the clasp of his survival watch. The hijacker then took that trademark to Amazon and registered it, giving him the power to kick Harris off his own listings and commandeer his name.

Source: Prime and Punishment

In-House Expertise

When the single Amazon seller is the brand themselves versus a dedicated Amazon seller, the brand needs to – in one way or another – attain the expertise in selling on the Amazon platform, either by training, hiring internally, or hiring a consultant.

• Who is the Amazon listing expert?
• The Amazon PPC expert?
• Who will stay current on Amazon Terms of Service?

The cost of this internal expertise is often underestimated by brands who don’t consider the true cost of hiring, training, and payroll burden. There’s also the issue of being back at square one if the brand loses their internal expertise – which you inevitably will at some point because people don’t stay with one company for long these days.

Smart brands focus on what they excel at and outsource what they don’t.

Now, it’s also worth noting that there are many benefits to having limited sellers of your products.

JC Hewitt, whose law firm frequently works with Amazon sellers, calls the system’s mandatory guilty pleas, arbitrary verdicts, and obscure language “a Kafkaesque bureaucracy with bad writing.” Inscrutable rulings emerge as if from a black box. The Performance team, which handles suspensions, has no phone number; there’s no one to ask for clarification. The only way to interact with them is by filing an appeal, and when it’s rejected, sellers often have no idea why. Sellers can call another Amazon department, Seller Support, but those workers can’t provide information about the Performance team and can offer only generic advice about what the seller might have done wrong.

Source: Prime and Punishment

Benefits of Having Two Sellers on Your Amazon Listings

If your brand relies on 3rd party sellers to sell your products on Amazon, it’s critical to understand how the number of sellers on any given product listing will impact sales, pricing, customer service, and brand equity in general.

Generally speaking, the larger the number of sellers, the less control your brand will have over pricing, content, promotions, advertising, and customer service.

Brands who limit the number sellers on their Amazon listings have made a wise move in many respects.

With limited sellers:

• pricing control on the Amazon marketplace is simpler
• it is easier to control the content (images, text) on the Amazon listing
• the brand doesn’t have to work with numerous sellers to coordinate consistent promotions
• the brand can be represented with a consistent level of customer service

All of the above are even easier with only one seller, but are all very manageable when the brand sells alongside one or two responsive brand partners.

The Performance workers’ incentives favor rejection. They must process approximately one claim every four minutes, and reinstating someone who later gets suspended again counts against them, according to McCabe and others. When they fall behind, Stine says, they’ll often “punt” by sending requests for more information, as Harmon experienced.

Source: Prime and Punishment

Is It Worth the Risk?

In the end, the decision whether to have a single Amazon seller – or act as your own Amazon seller – is up to you.

If you have a single 3rd party seller on your listing, there is really no benefit. If you’re acting as your own seller, there can be a benefit in terms of profit – assuming, of course, you don’t get your account suspended.

Only you can answer the question, is it worth the risk?

Scammers have effectively weaponized Amazon’s anti-counterfeiting program. Attacks have become so widespread that they’ve even pulled in the US Patent and Trademark Office, which recently posted a warning that people were making unauthorized changes through its electronic filing system, likely “part of a scheme to register the marks of others on third-party ‘brand registries.’” Scammers had begun swapping out the email addresses on their rival’s trademark files, which can be done without a password, and using the new email to register their competitor’s brand with Amazon, gaining control of their listings. As Harris encountered, Amazon appears not to check whether a listing belongs to a brand already enrolled in brand registry. Stine has a client who had trademarked their party supply brand and registered it with Amazon, only to have a rival change their trademark file, register with Amazon, and hijack their listing for socks, which had things like “If you can read this, bring coffee” written on the soles.

There are more subtle methods of sabotage as well. Sellers will sometimes buy Google ads for their competitors for unrelated products — say, a dog food ad linking to a shampoo listing — so that Amazon’s algorithm sees the rate of clicks converting to sales drop and automatically demotes their product. They will go on the black market and purchase or rent seller accounts with special editing privileges and use them to change the color or description of their rival’s products so they get suspended for too many customers complaining about the item being “not as described.” They will exile their competitor’s listings to an unrelated category — say, move a product with a “Best Seller” badge in the office category to lawn care, taking the badge for themselves.

Source: Prime and Punishment

We Can Help

At Inovtech Service, we have proven experience helping brands mitigate the single seller risk.

In addition, we provide Amazon expertise – we’ll optimize listings and provide PPC services, and there’s no charge for those services. We’re happy to discuss further; give us a call at (281) 213-0116.

About Inovtech Services

Inovtech Services a digital retail agency with significant expertise in the Amazon marketplace and unlike typical marketing agencies who will charge you thousands of dollars in fees, we earn our income by purchasing your products wholesale and then reselling them – thereby ensuring that our interests are 100% aligned with yours.

If you want to maximize traffic and conversions on the (highly competitive) Amazon sales channel, your Amazon listings need to be top notch, with compelling images and copy.

Unfortunately, Amazon product listings operate like a wiki – in other words, anyone and everyone who sells your products on Amazon can submit suggested edits to your listings at any time.

There is a solution to this problem. Amazon’s Brand Registry enables the brand owner themselves to control the content of the listing, regardless of who the seller is. Without Brand Registry, the likelihood of your product getting traction and stealing market share from the competition is far lower.

If you want to know how to create really great content and then make sure no one else can change it after the fact, read on and we’ll walk you through it, step by step.

Product Content

To create a highly effective Amazon product listing, the following areas must be addressed:

• Product Title
• Images
• Bullet Points
• Description

Product Title

When it comes to SEO on Amazon, there is no content element with a greater impact on SEO than the product title.

In our experience, simply optimizing the product title alone can have a profound impact on how a product will rank in the Amazon Search Engine Results Pages (SERPs) – which in turn contributes to increased sales velocity – which in turn helps the product rank even higher in the SERPs.

This flywheel effect is huge, and the effectiveness (or lack thereof) of the product title can help to unleash it.

So how does one optimize the product title?

The first step is to take a look at existing marketing materials, read existing customer reviews, analyze features and benefits, and take a look at competing products.

The goal of this first step is to gain a broader perspective of the problems that this particular product solves, as well as the ways in which consumers describe these problems.

Armed with this perspective, you are now ready to dive into Keyword research.

In a nutshell, the goal of keyword research is to find the most relevant words and phrases that consumers would use to find this product, and then make use of these words and phrases in the product title.

Here’s an example of a highly optimized product title. Notice the placement of the brand name, as well as how they made full use of the maximum number of words allowed.

Product Images

The next most important aspect of a highly optimized Amazon product listing is the use of product images. Using the product above as an example, you’ll note the following things:

• They have used 9 images
• The first image complies with Amazon TOS in that it is a shot of ONLY the product on a white background
• All the other images are either lifestyle images or infographics

The reason that images are so vital is that a significant portion of consumers are shopping from their mobile phone and as a result, they are far more inclined to use the information in product images (vs the bullet points and description) to help them to decide to buy or not.

Knowing this, smart brands make use of these images to feature reviews, product benefits, and so much more.

Bullet Points

Next in line after images are the bullet points. As you can see in the image below, Amazon allows brands to use up to 5 bullet points to describe key features and benefits of the product.

While not nearly as effective for conversions as optimized images, these bullets points do play a role in SEO, and as such, they should be carefully crafted to include relevant keywords as well as features and benefits.

Product Description

And finally, we have the product description. Using the same product as an example, you can see that in the product description Amazon now allows brands to make use of what is called Enhanced Brand Content (EBC).

Here’s a screenshot of just a portion of this product’s EBC.

The product description is an ideal place for a brand to tell their story to prospective buyers.In addition to making use of EBC, we recommend the following guidelines for creating an optimized product description:

• Match the brand voice
• Elaborate on the title/bullets
• Repeat only the most powerful benefits from your bullet points
• If your product is particularly technical, use the description to lay out in plain English what the benefit is
  “With an ISO range of 100-6400 (expandable to 12800), you can shoot in low-light situations, reducing the need for a tripod or flash.”
• Use logical & powerful language
• Include common terms used by consumers
• Emphasize your differentiators – what makes your product better/different than others on Amazon? (part of a bundle, better quality, more colors, etc)
• Overcome objections
• Help shoppers imagine the experience of using your product
• Evoke emotion where possible
  “Savor the luxuriously deep and velvety dark chocolate combined with tangy cherry pieces and roasted almonds for a delightful crunch.”

Brand Registry

Now that you understand how to create a highly optimized Amazon product listing, we need to talk about how to keep it that way.

Enter Amazon’s Brand Registry service.

According to Amazon, over 60,000 brands are now registered, and on average, they are finding and reporting 99% fewer suspect infringements than before the service was launched.

Brand Registry provides a variety of benefits according to Amazon’s website, including those listed below:

1. Accurate brand representation

Brand Registry gives you more control over Amazon product pages that use your brand name, so customers are more likely to see the correct information associated with your brand.

2. Powerful search and report tools

Amazon simplifies the process of finding cases of potential infringement with custom features designed specifically for brands:

• Global search: search for content in different Amazon stores from the same screen without ever having to navigate away
• Image search: find product listings on Amazon that match your product(s) or logo(s) using images
• Bulk ASIN search: search for a list of ASINs or product URLs in bulk to explore and report potentially infringing content fast (plus enlarge image thumbnails in this tool for easier identification of infringers)
• Sort view of average customer ratings of ASINs to gauge popularity

After you complete your search, Brand Registry provides you with simple and guided workflows to submit a report of potential infringement that Amazon can review and take appropriate action on.

3. Additional proactive brand protections

In addition to Amazon’s standard proactive measures to protect customers, Brand Registry uses information that you provide about your brand to implement additional predictive protections that attempt to identify and remove potentially bad listings.

The more you tell Amazon’s Brand Registry team about your brand and its intellectual property, the more Amazon can help you protect your brand, for example:

• Product listings that aren’t for your brand and incorrectly use your trademarked terms in their titles
• Images that contain your logo, but are for products that don’t carry your brand name
• Sellers shipping products from countries in which you do not manufacture or distribute your brand
• Product listings being created with your brand name when you have already listed your full product catalog on Amazon

To see if you meet the eligibility requirements to enroll your brand(s) in Amazon Brand Registry, visit brandservices.amazon.com/eligibility.

How Do Your Products Compare?

So now that you understand how to create great content for your products, as well as how to keep others from changing it, the only question that remains is this: how does your current content compare to your competitors and is it good enough to allow you to gain the upper hand?

Next Steps

Want to learn more about partnering with us? Get in touch.

What is one simple thing you should be doing to manage your brand’s reputation (that you’re probably not doing)?

Think back to your most recent purchase decisions. If you’re like the majority of shoppers, chances are you spent some of your time looking at star ratings or thumbing through detailed product reviews.

Over half of consumers expect responses to their online reviews, and 7 in 10 say they have changed their opinion about a brand after seeing the brand reply to a review. Consumers expect you to pay attention and reply to your negative (one and two star) reviews.

In this post we’ll cover:

• why reviews are so important (to the consumer and Amazon)
• why negative reviews are even more important than positive reviews
• what consumers expect from you when it comes to Amazon reviews
• how to manage your Amazon reviews

Consumers Trust Amazon Reviews
(Even When Shopping Offline)

As we all can attest to from personal experience, consumers continue to be more and more reliant on online reviews to help them make purchase decisions.

In particular, shoppers look to Amazon for product reviews. Although some sellers will find ways to game the system, Amazon has worked hard over the past few years to ensure their reviews are not manipulated by sellers/brands, even going so far as to file suit against websites that it alleges skew its product ratings. The end result is that consumers trust Amazon star ratings – they’re an extremely powerful form of social proof.

Even when shopping in store, shoppers frequently check prices and reviews online before making a purchase decision.

• a 2016 study showed that 39% of in store buyers read online reviews before purchases
• in 2018 BazaarVoice reported that 45% of brick & mortar sales started with an online review

These numbers underscore the importance of your products’ Amazon reviews, no matter where the final sale occurs.

Here are the top 3 risks of ignoring negative reviews on Amazon.

1. One Star Ratings Matter More Than Five Star Ratings

A Yale research paper examined the impact of online reviews on purchase decisions. While they found that a higher star rating leads to higher sales, they also found “evidence that one-star reviews have a greater impact than five-star reviews.” The researchers concluded that “the relatively rare one-star reviews carry a lot of weight with consumers. This result makes sense when the credibility of one-star and five-star reviews are considered.”

53% of customers expect a reply to their online reviews within a week

This is not the only reason you need to actively manage reviews. Consumers expect brands to be responsive.

2. Consumers Expect Brands to Respond to Reviews

Today’s consumers expect replies to reviews. Not convinced? Consider the following statistics:

• 53% of customers expect a reply to their online reviews within a week (Review Trackers, 2018)
• A 2018 BrightLocal study showed that 89% read replies to reviews
• 41% of respondents in a Bazaarvoice survey said that when a brand replies to reviews, it makes them believe the brand really cares about their customers
• Not replying may increase customer churn by up to 15% (Chatmeter, 2017)
• 7 out of 10 consumers changed their opinion about a brand after seeing the brand reply to a review (Marketing Charts, 2013)

These statistics are compelling. If you’re not actively replying to negative Amazon reviews, why not?

3. Negative Reviews Affect What Shoppers Will See & Purchase

The more 1 star reviews, the lower your overall star rating will go – especially if you haven’t built up a lot of reviews already. This is a twofold problem.

First, lower rated products are less likely to be purchased by consumers who view them.

Second, lower rated products are less likely to be shown to shoppers – Amazon wants to show higher rated products more prominently in the search results, because they know that consumers are more likely to go on to complete their purchase. They even won’t even let you run certain ads for products rated below 3.5 stars:

How to Manage Amazon Reviews

So, how should you manage reviews on Amazon?

1. Ask for reviews – anyone selling your products should have an active autoresponder requesting reviews
2. Remove negative reviews when you can – your team should actively remove negative reviews that violate Amazon’s Terms of Service (e.g., those that contain profanity)
3. Reply to negative reviews – show all consumers that you care about, and stand behind, your products
4. Analyze WHY you’re getting negative reviews – this is valuable market feedback!

We’ve found numerous reasons for negative Amazon reviews, including:

• packaging issues led to products being damaged in shipping (these types of issues led us to create custom premium packaging for Amazon for some of our brands)
• products were past their expiration dates, due to sellers not adequately managing inventory
• products that didn’t match Amazon listings
• consumers were unhappy with product quality and features

Review management is just one of the services you should expect when partnering with a 3rd party to sell your products on Amazon. While you’re at it, check out the rating on Amazon for the 3rd party as a seller – it should be 99-100%.

Conclusion

Online reviews, and particularly Amazon reviews, are important, as they drive consumer perception of your brand and therefore sales.

Negative reviews are of particular importance to shoppers, and shoppers expect brands to respond to those reviews.

Brands that appreciate the importance of Amazon reviews will have a system in place to actively generate and manage reviews.

About Inovtech Services

Inovtech Services a digital retail agency with significant expertise in the Amazon marketplace and unlike typical marketing agencies who will charge you thousands of dollars in fees, we earn our income by purchasing your products wholesale and then reselling them – thereby ensuring that our interests are 100% aligned with yours.

Amazon is in the midst of testing a new brand registry system designed to reassure vendors that sell on its marketplace that their intellectual property will be protected – which, up to this point, is something that Amazon has struggled to do.

In their latest announcement, Amazon said that they will now let any brand register its logo and other IP with Amazon starting sometime in April; thereby enabling Amazon to remove listings for counterfeit product.

The move is just part of Amazon’s larger initiative to reassure prospective brands that their trademarks and other IP are safe on its Marketplace.

According to Peter Faricy, VP of Amazon Marketplace, last year, 100,000 sellers sold at least $100,000 worth of goods in 2016. “This puts Amazon in the position where we can protect your product across the Amazon Marketplace,” Faricy said.

The brand registry, first tested in 2016, will be free to North America vendors.

So What’s The Big Deal?

According to Cynthia Stine, or eGrowth Partners, there are a number of things that brands should be excited about:

1) Brands don’t need to be sellers to join the registry anymore.

2) Brands can take down sellers for infringement which includes things like logos, using their name, trademarks, copyrights and IP, even if a seller used their own UPC code instead of the brand’s UPC.

3) It will be super easy for brands to do this without lawyers and the long time it takes now. Cynthia said that her team has already seen brands take down all their listings on the platform and kick off all the sellers for infringement. This will only escalate when the program is out of beta. Cynthia said she predicts a lot of cease and desist orders will go out to sellers for all kinds of brands.

What’s Next?

At this point in time, we do not yet have the details of the new/improved program from Amazon so it’s tough to take any specific action at this juncture. As soon as Amazon releases the details of the program, we’ll be publishing a “how to” blog post that describes in detail the steps needed to take advantage of the new initiative.

About Inovtech Services

Inovtech Services a digital retail agency with significant expertise in the Amazon marketplace and unlike typical marketing agencies who will charge you thousands of dollars in fees, we earn our income by purchasing your products wholesale and then reselling them – thereby ensuring that our interests are 100% aligned with yours.

Entrepreneurship in China is strong – it’s a large part of why China has grown so rapidly in the last three decades. For many Chinese entrepreneurs, the allure of selling on Amazon is their gateway to riches. In fact, professionals estimate that there are over 200,000 Chinese businesses currently selling on Amazon and this number is only expected to rise.

With this chase of seemingly easy money also comes the inevitable tip-toeing into unethical business behavior. In this article, I’m going to show how Chinese sellers are using everything from fake reviews and zombie buying accounts to stolen data from Amazon employees to manipulate Amazon. And this isn’t a victimless act – consumers pay the ultimate price as they’re deceived into believing that garlic press with an Amazon Choice badge truly is the best garlic crusher available, when in fact it may just be the one with the most number of fake reviews.

I should say that, by virtue of having a Chinese wife, I’m obligated to point out that I am not xenophobic and the strategies I describe herein are not exclusive to Chinese sellers. Sellers of nearly every nationality are using similar tactics. However, there’s little doubt that China is often the innovator and at the forefront of many of the strategies I’m about to discuss.

Why Manipulation from Amazon Sellers is Rampant

This article begins with a short love story of two maniacal lovers who can’t escape one another. Amazon is in love with Chinese entrepreneurs and Chinese entrepreneurs are in love with Amazon.

Amazon’s mission is to provide customers with the lowest prices possible. Part of the way to achieve this is to deliver the flattest supply chain, and that means getting sellers as close to Chinese factories as possible. Amazon routinely holds summits in Mainland China and aggressively tries to attract more Chinese sellers. At the same time, the Chinese government is hungry for anything cross-border commerce and actively supports anyone that helps satisfy that thirst. In Shenzhen, the Silicon Valley of China, the Chinese government has helped to develop numerous industrial parts, like the company China South City (华南城) devoted almost entirely to eCommerce sellers.

The result of this infatuation is that Chinese sellers are eager to chase the dream of Amazon riches at almost any cost and Amazon themselves are apt to ignore certain pernicious activities from Chinese sellers.

Using Fake Reviews to Mislead Buyers

It’s no secret that Amazon customer reviews are one of the most important factors affecting a customer’s purchase decision on Amazon. So it should come as no surprise this is also one of the most frequently abused tactics by Chinese sellers. Zach Franklin of AMZKungfu is originally from Detroit but now lives in Shenzhen, China and is a popular non-Chinese Amazon consultant for Chinese sellers. He explained to me that in his experience at least 50% of Chinese sellers are using some form of review strategy against Amazon’s terms of service. As Zach described to me, “To many Chinese Amazon sellers, the question of how to succeed on Amazon has a simple answer: reviews equal sales”.

Zack Franklin, a consultant for Chinese sellers, says that in his experience over 50% of Chinese Sellers are using some type of black-hat review strategy but also stresses that most Chinese sellers would prefer to build real defensible brands without resorting to such strategies.

A Chinese seller’s review strategy can come in one of two varieties: compensating/reimbursing real customers for leaving a positive review or the more extreme technique of making fake orders and leaving positive reviews through zombie Amazon accounts.

Fake review services, normally from China, aggressively solicit Amazon sellers, even from within Amazon’s Seller Central platform. This is a typical email that many sellers receive several times a week.

Here’s how sellers use these so-called zombie accounts: fake review companies (almost always in China) open hundreds or thousands of fake Amazon accounts. They then emulate “real” customer browsing behavior so as not to arouse Amazon’s suspicions. They even go so far as to use real shipping addresses by contacting real individuals in America (sometimes through stolen customer information from Amazon’s databases) in exchange for compensation and/or free products. According to one Chinese selling consultant, who wished to remain anonymous, fake reviews generally start at $3-5 depending on how likely or not these fake reviews are to be detected by Amazon.

Of course, outright fake reviews aren’t the only way reviews are manipulated. While Amazon banned incentivized reviews in 2016 the practice still exists in various forms, everything from “rebate clubs” where consumers get rebates (often for a 100% rebate of the purchase price) to compensating consumers for leaving positive reviews through extended warranties and future discounts.

Stolen Competitor Information from Amazon Employees

Chinese sellers aren’t the only one employing malicious selling activities to game Amazon. Amazon has thousands of employees working for it within China and some of these employees are stealing seller information internally from Amazon’s databases and reselling it to other sellers and service providers. If a seller can find out certain information about a competitor’s product, such as their sales and page view history, it can be extremely valuable.

This is how it works: mid to senior ranking employees within Amazon China have direct access to Amazon’s internal network that allows them to access private information related to all sellers. Corrupt Amazon employees will steal a business report of any desired competitor showing information such as how many times a product was viewed over a period, how many times a product was purchased, and the total sales of those items.

An example of a stolen “ASIN report” from Amazon showing private search statistics for a particular product.

Sellers can even request an ASIN report that shows exactly what keywords were most likely to lead to a customer purchasing their item. Prices for these reports range widely (invariably the reports are cheaper from Chinese only websites) but one service provider charges $399 for two ASIN reports and a few other reports. Seeing this data can be valuable both for a competitor’s products and a seller’s own products, however, sellers cannot see this data for even their own products – they have to purchase a stolen report from an Amazon employee.

An example of a stolen “session report” of a competitor’s product purchased from an Amazon employee in China.

As one Chinese reseller of this information described to me (he wished to remain anonymous) these corrupt Amazon employees leak these reports for around $20 per report, but the price will depend on the riskiness of that employee accessing that information (i.e. the chances of them getting fired).

Stolen Buyer Information

Amazon’s customer database is something that they go to great lengths to protect. They do not reveal to sellers the customer’s email address and recently even removed the seller’s ability to see the customer’s phone number. But for unscrupulous sellers, this information is available – for a cost.

The majority of Chinese Amazon sellers are based in China’s Silicon Valley, Shenzhen.

The same employees within Amazon’s China office who are stealing competitor business reports will also steal customer information. All that these corrupt Amazon employees need is the Order Number for a customer order or a link to a product review the customer used. This information can be used in a variety of ways, everything from privately contacting a customer to ask them to remove a negative review in exchange for some type of payoff all the way up to running advertising campaigns to that customer either directly through email or indirectly through a Facebook remarketing campaign. An anonymous service provider who buys this information told me that Amazon employees charge around $3 to get this data.

Secret Amazon Selling Accounts

As I just discussed, Amazon does drop the hammer on unscrupulous sellers that compromise the Amazon marketplace, such as sellers who abuse fake reviews. And when Amazon drops the hammer and suspends a seller, the consequences can be dire – not only does that seller lose their ability to sell on Amazon, they lose the ability to sell potentially hundreds of thousands of dollars or even millions of dollars in inventory. Given these risks, many Chinese sellers secretly open several Amazon Seller Central accounts, despite this being strictly against Amazon’s terms of service. Having multiple selling accounts gives sellers the ability to take higher risks.

Amazon is very good at detecting multiple selling accounts from a single seller and sellers subsequently go to great lengths to hide the identity of these accounts – many Chinese sellers require their staff to open accounts under their names but under control of their company. These accounts are often even used with separate internet service providers to avoid Amazon detecting any IP sharing.

An associate of mine who previously worked for a large Chinese Amazon seller in the pet industry described it to me this way “In our company we literally needed a diagram detailing all of our selling accounts so our staff could keep track of these accounts”.

Sales Tax Evasion & Product Safety

There’s one final area where foreign sellers, including Chinese sellers, are able to gain an upper-hand: sales tax and product safety.

Currently, the issue of whether Amazon or the sellers themselves are responsible for collecting and remitting sales tax lives in a bit of limbo. Amazon now collects sales tax in Washington State and Pennsylvania on behalf of sellers but the Supreme Court in June ruled, more or less, that sellers could be held liable for collecting sales tax. It doesn’t take a CPA to realize that a foreign seller, especially a seller that’s residing in China, is going to have much better-protected assets than his American counterparts.

Amazon similarly puts the onus of product liability on sellers (and courts have frequently upheld the opinion that Amazon bears no liability in defective items). While Amazon has a requirement for sellers to hold at least $1million in product liability insurance it’s little secret that Amazon does not enforce this requirement. And once again, it does not take a law degree to realize that an American business with domestic assets is going to be a lot more susceptible to product liability lawsuits than a foreign business, especially a Chinese one. Does this mean that Chinese sellers are deliberately selling unsafe goods? No. But they are afforded some protection from compensating consumers, that American businesses are not, in the event they do sell unsafe products.

Conclusion

It’s important at this juncture to point out that gaming Amazon is not a tactic exclusive to Chinese sellers. Anyone who has sold on Amazon long enough realizes that sellers employing questionable selling tactics bear all types of passports. I’ve personally met many of them from nearly every continent in the world. As Zach Franklin emphasized, “Most [Chinese] sellers I know just want to build a real, defensible brand. They’re hiring better designers and copywriters, building a real presence off of Amazon, trying out influencer marketing, Adwords, and Facebook. They want to do things in the right way and they’re working from 9 am – 9 pm, 6 days a week to do it”.

If anyone deserves blame, it’s Amazon themselves. The fake reviews that are proliferating in Amazon are one that I believe Amazon is legitimately trying to stamp out as they recognize it’s a giant threat to their trust as a marketplace. However, in my personal experience as a seller, Amazon seemingly allows nearly any selling strategy to slide until a wave of negative press arrives that threatens its revenues. As one Chinese service provider described to me, “Amazon turns a blind eye to the leaking of competitor data from employees. It doesn’t hurt them”. Amazon bills itself as “Earth’s Most Customer- centric Company”. The reality is that Amazon is like nearly every large corporation and only cares about one thing- Amazon.

This post originally appeared on ecomcrew.

About TLK Sourcing

TLK Sourcing a digital retail agency with significant expertise in the Amazon marketplace and unlike typical marketing agencies who will charge you thousands of dollars in fees, we earn our income by purchasing your products wholesale and then reselling them – thereby ensuring that our interests are 100% aligned with yours.