Amazon’s Policy Clarification on Rebates: What It Means For Sellers

This post is by Chris McCabe, owner and founder of ecommerceChris, LLC, an Amazon seller account consultancy.

On November 2nd, Amazon posted an announcement on the Seller Forums that shook up the seller community, prompting numerous comments about a groundbreaking update.

But it wasn’t really an update so much as a clarification. Amazon further defined what marketing strategies and reviews-gathering techniques they consider illicit and rule-breaking. Given the frequency of suspensions for sellers who believed they HAD followed the guidelines, Amazon had to say something.

It’s good to see Amazon confirm in writing who is playing by the rules and who is violating them. But we still see Seller Performance managing the appeals process in an incredibly haphazard and unfair manner.

What does the policy say?

With each passing month, Amazon adds more lines to their code of conduct policies. 

The key quote from Amazon’s Code of Conduct is below:

You may not attempt to influence or inflate customers’ ratings, feedback, and reviews. You may request feedback and reviews from your own customers in a neutral manner, but may not:

• Pay for or offer an incentive (such as coupons or free products) in exchange for providing or removing feedback or reviews
• Ask customers to write only positive reviews or ask them to remove or change a review
• Solicit reviews only from customers who had a positive experience
• Review your own products or a competitors’ products

As those of us who help sellers appeal their suspended accounts know, Amazon disallowed many of these practices a long time ago.

They proved it by increasing account suspensions. Unfortunately, whenever a business owner interprets Amazon policies in a way that favors their particular approach to selling on the marketplace (while also flying in the face of Amazon compliance) everything flows over to the dark side fairly quickly. 

Why does the company execute recurring “crackdowns” on reviews abuse and sales rank manipulation so often? Amazon faces a growing need to show the media, the US government, and the greater buying public that they have teams and tools to root out product review or sales rank manipulators.

How does that impact sellers? Amazon seeks to identify all parties who are abusing policies whether they are third-party services or sellers. Given so much previous controversy over Amazon’s slow reaction and poor systems to detect abuse, they have to play catch-up in a big way to regain credibility.

Simply put, Amazon must stop the onslaught of buyer exposure to bogus info on their site. They use the suspension process to chase off abusive third-party services, and sellers become the collateral damage in that effort.

After years of neglect, Amazon finally bolstered the headcount on the teams they tasked to handle this problem, known as PRA (Product Review Abuse). They realize the damage to marketplace integrity if they enforce rules haphazardly and they know the problem isn’t going away anytime soon.

So how do they handle it? They make examples of sellers they catch in order to demonstrate what happens to business owners who don’t take policies seriously.

Why did Amazon feel the need to clarify the policy? 

Sellers continued to offer giveaways or 100% rebates after purchase as part of their marketing strategies to boost sales and garner reviews, prompting Amazon to ramp up enforcement.

Many believed that their off-Amazon sales funnels didn’t break Amazon rules because they weren’t forcing anyone to leave a review. In some cases, the sellers were not asking for reviews at all.

But whether they used QR codes to direct buyers to a process involving heavily discounted products, or gave items away via social media messenger bots, they failed to understand what Amazon considers sales rank abuse.

Amazon prohibits any artificial boost to sales rank, or product reviews, that induces buyers to leave (more likely than not) a good review on branded products. 

Why now? 

Amazon had to clarify the policy at some point, as they were constantly suspending high numbers of sellers for the same infractions.

Whether they suspended sellers due to badly written policy pages that few outside the company can understand, or due to third-party services guiding sellers the wrong way, suspensions just keep happening. This inflates the number of sellers filling up Seller Performance queues with appeals, generates additional escalation requests, and creates even more of a mess than Amazon already has in front of them. 

Amazon must know how often sellers fail to understand the way policy is interpreted. They had to clarify the policy eventually, otherwise all of the friction around inflated sales rank and fake reviews would keep showing up in news media, FTC investigations, Congressional committees, and anywhere else observers track bad “big tech” behavior.

Even though the policy was not actually updated, the “news” came as a shock to some sellers because they believed everything they had been doing prior to this announcement was compliant with Amazon’s TOS. It’s not really news because the guiding principle remained fundamentally the same for the past few years.

This is why they called it a clarification, not a policy change. Amazon never wanted sellers to offer big incentives to groups of specific buyers to goad them to buy products for less than others would, or in exchange for something. They just didn’t pay that much attention to it.

Amazon did follow up with a policy update to explicitly prohibit search rank manipulation, but the wording on product reviews has remained the same.

What will change? 

A lot, for some sellers. They may need to change their entire marketing strategy to accommodate harsher enforcement trends.

While we don’t know how long Amazon will monitor off-site behavior, we do know that they sometimes turn on a dime and begin suspending sellers without much warning. Brands can’t depend on a return to these techniques anytime in the future – that would be a high-risk strategy. Even if the rewards are high, you would have to expect to lose your account at any moment. 

Sellers will have to market themselves with less dependence on tricks or gimmicks to get their products noticed on the marketplace. Artificially inflating sales rank by hiring “specialized” third-party services needs to be swapped out for a more comprehensive marketing approach.

Sellers will spend more on ads and work differently with influencers, or depend more on quality branding, rather than free products and giveaways.

Is this the end of off-Amazon marketing?

Sellers may feel like they can’t do any marketing via social media or their own sites anymore.

You can, but it needs to be available to all Amazon customers. It can’t be available only to a select group of people who have already demonstrated that they’ve left you a nice review, or to anyone who is going to be expecting a rebate or payback once they leave a review.

That’s really the point of all this. Amazon believes that sellers knew they were incentivizing reviews with all of the rebates and giveaways, but they failed to consider the consequences. Thus, they had to suspend them and reeducate them on policy the hard way. 

What’s the bottom line?

Amazon has made it clear that they want sellers to interpret the policy their way, not to suit their own needs. Sellers who intend to join the marketplace with a new brand need to make sure they fully understand all parameters and moving parts, and get it right the first time! There is no room for error at this point.

We’ve seen Amazon reject appeals out of hand, showing no interest in even reading a Plan of Action for reinstatement, after reviews abuse or sales rank manipulation. As of Fall 2021, they lost any remaining willingness to spend time reviewing these, let alone accepting them. Even escalations find their way into the wastebasket quicker for these risky behaviors. 

While it seems absurdly harsh, Amazon is tired of sellers embracing practices that they were warned about many times before. Amazon thinks that at this point, if you’re still out there looking to “game the system” or pull the wool over Amazon’s eyes using hidden black hat tricks, they’ll never be able to trust you to follow policies.

Keep in mind, many sellers only turn apologetic after they’ve lost something important (namely, their entire account) and short of that, will continue to use whatever works to increase their sales. Or they see what other sellers get away with, and decide that it means anyone can do it. They take the lack of consistency on the enforcement side as evidence that there is no enforcement at all, and are surprised when Amazon suspends them.

Given the frustrations of this awful experience we recommend avoiding these practices entirely. Any of these risky sales strategies can result in suspension, followed by weeks of silence from Seller Performance. That can kill a business very quickly.

Remember, Amazon is motivated to take as many punitive actions as possible against as many sellers as possible, until this purge rounds itself out. We’ve seen numerous seller accounts suspended for this over the last two years, so we can see why Amazon believes sellers have had plenty of time to adapt. Just make sure you’re right about what’s in bounds or out of bounds, before you begin using it.

Smarter and less risky marketing

Don’t expect any more clarifications from Amazon on this matter. Everyone’s on notice to get this right, so pointing fingers at third-party services or blaming others for a violation on your account won’t work. You’ll need a bona fide strategy to get buyers aware of your brand, instead of utilizing black hat tactics that put your account at risk of suspension. 

We spoke to Jason Boyce of Avenue7Media, an agency that helps sellers understand the best marketing strategies on Amazon. He agreed that:

Amazon is still encouraging driving external traffic to Amazon listings and Amazon Brand Stores, and there is evidence that this traffic improves sales and ranking. I would encourage sellers to drive awareness to their listings and brand store via external traffic. You can even offer a special social media code Discount Coupon to your Amazon listing via social media.

What about anyone addicted to past rebate strategies? He offered:

Rebate folks were offering 100% off in exchange for a sale (and sometimes reviews); however, the same ranking benefits can happen by running 50% Off Lightning Deals, 7-Day Deals, Coupons, or Prime Exclusive Deals within the Amazon ecosystem.

Amazon wants it their way, in other words, and playing by their rules.

When in doubt, find a compliance expert, preferably one who doesn’t do sales-side consulting or have other skin in the game. Someone who can advise you on which strategies carry what kinds of risk. Otherwise, you risk suspension followed by the unnerving experience where Amazon ghosts all your appeals from the very start.

This post was by Chris McCabe, owner and founder of ecommerceChris, LLC, an Amazon seller account consultancy. Chris was formerly an Investigation Specialist for Amazon’s Seller Performance team.