The seller waging war on their rival, the retail shark moving in for the kill in Australia and the angry sellers sending half-baked escalation emails.
This post is by Chris McCabe, a former Investigation Specialist for Amazon’s Seller Performance team and founder of ecommerceChris.com. ecommerceChris shows Amazon sellers how to keep their accounts healthy, or, if the worst should happen, how to get their account back from a suspension.
The majority of Amazon sellers will tell you that selling on marketplaces is a cutthroat world, but one seller has taken this to heart. This self-proclaimed “virus of Amazon” has almost driven the seller of a number one product out of business.
Change is afoot in Australia, as some sellers have reportedly been involved in initial testing for Amazon’s latest expansion. While consumers are jumping for joy at the prospect of lower prices and wider selection, existing retailers are worried about the impact that the retail giant’s arrival could have.
In the world of suspensions, sellers are firing escalation emails off to Jeff Bezos and the Executive Seller Relations team too quickly, without solid a Plan of Action. The end result? A deeper hole to get themselves out of.
Meanwhile, the sales tax saga rages on, as South Carolina take legal action against Amazon directly, while other states continue to send audit letters to third-party marketplace sellers.
The Virus went Viral: An Amazon Seller Story for Our Times
Pure Daily Care had the number one facial steamer on Amazon but were suspended for seven weeks, and lost an estimated $400,000 in revenue, when a rival seller set about attacking their listing.
If the buying public were previously ignorant to how marketplace sellers treat each other, they can’t be now. This story by Ari Levy generated a lot of heat, and for good reason. In showing how one seller came after another with about as much black hat power as they could muster, it illustrates just how far sellers will go to take out their competitors on Amazon. Truly, the opportunity to swipe sales from another seller often brings out the worst in human behavior, especially if it looks like the watchdog isn’t watching.
First, a clarification. Amazon suspended our client, Pure Daily Care, for submitting false intellectual property infringement claims. It turned out that a competitor had been reporting spurious infringement claims to Amazon, using Pure Daily’s email address. The competitor also apparently contacted Pure Daily’s owner, David Damavandi, calling themselves the “virus of Amazon”, threatening to leave 1-star reviews on his listings and saying, “Let the war begin”.
We helped David get reinstated very early on in the account appeal process, with a Plan of Action detailing all the steps he’d taken to protect email security and avoid having the primary email associated with his account known to outsiders. Amazon accepted his plan of action and the appeal sailed through. Problem solved, right?
Well, unfortunately, things sometimes slide sideways in Amazon-land, and David found himself re-suspended within hours. This was the fastest a client has ever contacted me to tell me they were re-suspended. We went back to work, and dealt with the new suspension.
So if Amazon cannot tell that you are you, what can you do? The larger and more crucial matter here appears to be that the Notice-Dispute teams were unaware of who was who, and didn’t believe David when he professed not to be the responsible party.
- Make sure your primary email address isn’t known to everyone under the sun. Use a unique one, and keep it private, so that no one can pretend they’re you and spoof the email address. Faking the “from” address of an email is trivially easy for those prepared to do it.
- Pay attention to, and save, threats or messages from other sellers for future reference. This could be screen grabs, or you could save the comments into a PDF, whatever you need to do to have them available for later presentation to Amazon.
- Don’t reply to, or get into online messaging debates with, sellers you suspect of attacking you. It doesn’t matter if they appear to be negotiating with you, or if you think you’re gathering precious intel on them, and didn’t really tell them anything damaging. Talk to an attorney about it first for professional-grade legal advice.
- Don’t waste time telling the story to the wrong teams, like Seller Support, unless they’re going to tell you exactly why internal teams are stonewalling you (but even then it can be hard to tell if they’re giving you accurate info). Ask somebody who knows what’s going on internally with matters of this nature, like me, or an expert who can explain this back to you without guessing. Facebook groups and forums are nice to read and get the juices flowing, but make sure the opinions there match up with reality.
- Keep all documentation you have to prove you’re selling genuine and “as advertised” products and don’t let vague, spurious letters from sellers or certain law firms dissuade you from representing your interests the right way. Intimidation attempts are common nowadays, but back yourself up with the correct documentation and knowledge of the right way to present it.
Each situation may vary given the plethora of attack strategies. Think before you act, and understand the best ways of escalating this internally, whether it’s to the Notice-Dispute teams or other policy teams that tackle marketplace abuses. With new Amazon internal teams comes new understanding of how to report abuse by other sellers the right way.
Sellers are becoming too eager to send escalation emails about their suspension problems and aren’t spending enough time putting together a solid Plan of Action first.
“How can I escalate this?” – I see this question come through almost every day via my website intake forms, usually along with a summary of an account suspension or ASIN block that Amazon has just put into place.
From having worked Bezos escalations and now from handling them daily as a consultant, I have strong opinions on how to approach an escalation. These days, Amazon investigators are more likely than ever to disregard your arguments and think, “I’ve heard this a dozen times today, why should this one be any different?”, so you need to learn how to break through that noise and push things up to the right people.
During appeals, each seller needs to undertake the “pre-escalation process” before firing off angry missives to Jeff, Executive Seller Relations, or anyone else at Amazon that you’ve decided will immediately care. More often than not, when I ask to see the POA that’s meant to be submitted to a manager, I see a document with gaps, promises that lack substance, or generic content based on comments from a seller forum. Amazon needs more.
“Who should I escalate to and where should I send this?” are questions that should come to mind only after you answer the questions below. I understand the feeling that Amazon investigators never read your appeal, and while quick reviews by rookies do happen all too often, you still need to perfect your end of the equation before you get loud.
What goes into your pre-escalation assessment? I’ve outlined a few points you need to address.
- Is my appeal complete, with a Plan of Action that addresses each cause of the original problem?
- Am I adding a credible and proactive solution for each cause of Amazon’s complaint?
- Is the Plan convincing? Do those who know what’s expected on the other side find solutions like mine viable for the kinds of complaints on my account?
- Have I written my past Plan of Action using bullets or a numbered line-item style?
- Are my ideas well communicated, and do they make sense to an outsider? Or is this only going to add up inside my own mind, team or company?
- Am I making the necessary upgrades to my operations and describing them in detail, or am I backing away from what really needs to happen next?
I could go on with this for a while, but you get the idea. Only start composing escalation emails to Jeff, Joe, Jenny or Jim once you have the POA locked down solidly. If you don’t you’re only going to create a larger mess, and risk burning your chances of making a successful appeal.
Sales Tax Update
South Carolina take legal action to try and force Amazon to collect sales tax from third-party sellers, while other states continue to send out audit letters.
As seen in both the New York Times and CBS stories, events in the sales tax collection saga have heated up lately. Firstly, South Carolina filed a motion to demand that Amazon finds its wallet for sales tax collection. In the meantime, states like Washington and California still send out audit letters to Amazon merchant account holders.
Amazon too must now address the developments in South Carolina. They clearly recognized the risk in a recent filing with regulators:
“If South Carolina or other states were successfully to seek additional adjustments of a similar nature, we could be subject to significant additional tax liabilities”.
I asked Paul Rafelson, our resident tax attorney and expert on these matters, to comment on the latest developments.
Chris: Simply put, what does the SC case mean for potential action in other states?
Paul: The South Carolina action, to me, is important because it shows sellers that states can get it wrong… Even if South Carolina lost their case, it still raises the question of how could any state reasonably hold sellers responsible when the states themselves don’t even know what the answer is. If the law is that ambiguous, and the states’ pursuit of sellers is based on false assumptions, then states have no real cause of action against these sellers that amounts to anything more than simply an illegal shake down.
Chris: Washington is one of the major states sending out audit letters, so what should sellers who get these do now, given the SC injunction just filed? Or are they connected?
Paul: Washington’s pursuit of back taxes against sellers for six years, is equally absurd. Not only is it totally in conflict with Washington law to hold these sellers responsible, but the fact that they are only being told now by sending out these “gotcha” notices, is absurd. It’s not something a reasonable person reading Washington state law would conclude.
Chris: So, does this injunction have immediate importance, or will this take months and years to play out?
Paul: The injunction is important because it reminds states that when a large retailer plays chicken with your sales tax revenue, you have options outside of the normal litigation process that takes years. Large retailers cannot hold state tax revenue hostage. I mean could you imagine if Target just decided to stop collecting in its stores? A county sheriff would probably be in front of every Target in the state to chain the doors shut, and stop it doing business until it started collecting. That’s how states need to treat this Amazon situation. They need to stop Amazon from doing business in the state until it collects.
And Finally… a Giant Wave Rolls Into Australia
As Amazon prepares to start an initial testing phase in Australia, analysts are worried about what this could mean for existing retailers Down Under.
I’d like to give you a quote from the classic film Point Break (1991), where Patrick Swayze’s character Bodhi surfs his final giant wave in the Bells Beach Australia “fifty year storm” (actually filmed in Washington state and closer to Amazon’s Seattle HQ than anywhere in Australia, but let’s leave that for another time).
This is a once-in-a-lifetime opportunity, man.
Just let me go out there, let me get one wave before you take me. One wave.
Where am l gonna go, man?
Cliffs on both side. l’m not gonna paddle to New Zealand!
Australian retail is in for a major ecommerce-fueled overhaul. This “once in a lifetime opportunity” finally presents itself to ecommerce merchants there, and excitement is building along with questions about what it means.
Whether as CNBC states this is a trial or a test, the indications are clear. Australian retailers have cliffs of ecommerce competition on both sides and nowhere to retreat to if they want to hide from the threat that Amazon poses. They can’t paddle to New Zealand, because ecommerce merchants there are just as excited about the Amazon Australia launch. Instead, they need to consider which strategies will stem the Amazon tide in the next few years.
As described in a Bloomberg piece, Amazon’s about to transform online sales in Australia and it probably won’t take too long, either. We’ve seen how quickly things can change in terms of revenue generation and shopping habits in the US and EU. As buyer habits change, and buyers embrace better pricing online, and they may turn their backs on traditional brick and mortar retail faster than anyone imagined possible.
I’ve been speaking with Australians who attended the Nov. 13 seller summit in Sydney, and will provide some insights next time into their feedback. The estimate by Bloomberg was that the leap forward from 7.5% online sales to 10% would take 18 months to two years, but you heard it here first: it’ll be less than that.
I’m soliciting seller summit feedback and asking Australians with or without previous Amazon experience to contact us with questions, comments, hopes and fears. Australia is the next Amazon frontier and I’m keeping a close eye on what happens next.
What’s new and impacting your business as a marketplace seller? Drop an email to email@example.com and I’ll look into it for you.
Chris McCabe can be contacted via ecommerceChris.com.