#69 - How Amazon's Fee Changes Will Transform Your Selling Strategy

Amazon has thrown sellers another curveball with significant changes to their promotional fee structure, and the timing couldn't be more strategic—just before Prime Day. Velocity Pete and Abe Shomali break down these critical updates that will reshape how brands approach deals and discounts on the platform.

Starting June 2nd, Amazon's promotional tools will shift from simple fixed fees to a hybrid model combining base costs with performance-based percentages. Lightning Deals are moving from a flat $150 to $70 per day plus 1% of sales (capped at $2,000). Best Deals follow a similar structure without a specified cap. Coupons transform from 60¢ per redemption to $5 per coupon plus 2.5% of sales. And Prime Exclusive Discounts? They're simply doubling in price from $50 to $100 daily.

The implications extend beyond just higher costs. These changes will force greater selectivity in what products receive promotional treatment, potentially creating a marketplace with fewer but more meaningful deals. As Abe insightfully notes, "When the top third of the page turns into one or two running a deal at any point in time, those products stick out." This increased visibility could actually benefit the strategic sellers who continue with promotions despite higher costs.

What's particularly fascinating is how these changes may widen the gap between sophisticated and unsophisticated sellers. According to the discussion, only about 10-15% of Amazon sellers take a truly analytical approach to promotional decisions. The rest rely on gut feeling or general principles rather than data-driven analysis. As promotional costs increase, this distinction in approach will likely create greater disparities in results.

Don't miss this timely discussion that goes beyond surface-level analysis to provide actionable insights for navigating Amazon's evolving fee landscape. Whether you're preparing for Prime Day or planning your long-term Amazon strategy, this episode delivers the calculations and considerations you need to stay profitable amid these changes.

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