Amazon slashes commission rates for program that gives publishers a cut of sales - 7 day notice until your link farm's revenue drops by 75%

Leonard Helplessness

kiwifarms.net
(link) (archive)

Amazon slashes commission rates for program that gives publishers a cut of sales

PUBLISHED TUE, APR 14 20204:51 PM EDT
UPDATED TUE, APR 14 20205:08 PM EDT

KEY POINTS
  • Amazon on Tuesday told members of its affiliates program that it will cut commission rates beginning April 21.
  • Rates are being cut for a number of affiliate product categories. For example, the affiliate cut from purchases of furniture and home improvement products has fallen from 8% to 3%.


Amazon is cutting commission rates for members of its affiliate program.

The company notified members of the program, known as Amazon Associates, that it will slash commission rates beginning April 21, according to an email obtained by CNBC.

Amazon has for years operated the affiliate program, which allows members to advertise and link to Amazon products in exchange for a percentage of the sales. The program drives significant revenue for online websites who link out to Amazon products in their content. It’s especially important for online publishers like BuzzFeed, The New York Times and Vox Media that publish buying guides that drive readers to buy products from Amazon for a cut of the sales.

Rates are being cut for a number of affiliate product categories. For example, the affiliate cut from purchases of furniture and home improvement products has fallen from 8% to 3%, while the commission rate for grocery products has slid from 5% to 1%, according to a document obtained by CNBC.

An Amazon spokesperson confirmed to CNBC that the company notified U.S. associates Tuesday of the fee change. The spokesperson declined to comment on whether the decision was a result of the coronavirus pandemic.

The spokesperson said Amazon regularly evaluates its program offerings to ensure it’s competing with the broader industry and added that such rate evaluations are a standard industry practice.

Here are the rates for product categories before the change:

1586924124463.png


And here are the rates after April 21:

1586924147922.png


Here’s what Amazon is telling members of its affiliate program:

Hello Associate,
We hope you are staying well during this time. We are writing to inform you of upcoming changes to the Amazon Associates Program Operating Agreement, which governs your participation in the Amazon Associates Program. All changes are effective as of April 21, 2020.

Visit the
What’s Changed page to see a summary of these changes. You can also find the Operating Agreement, Program Policies, and the Fee Statement if you would like to refer to the current, pre-change versions.
Sincerely,

The Amazon Associates Program


Amazon’s business has been impacted on a number of fronts as a result of the coronavirus outbreak. Hit with a surge of online orders, the company moved to prioritize shipments of essential items in its warehouses, though it has since begun winding down those restrictions. The virus also forced Amazon to temporarily pause its Prime Pantry delivery service, while its Amazon Shipping pilot program will be halted in June.

Prior to Tuesday’s announcement, Amazon had already made some cuts to its commerce marketing deals. Last month, the company informed digital media firms it would suspend commerce marketing deals, according to The Information.

One member of the program, who asked to remain anonymous, said they “cannot afford” the fee cuts that were announced, since a main portion of their income comes from commissions earned via Amazon links. The member runs several Facebook groups that advertise shopping deals across the web, including Amazon products.

“All the affiliates I talk to make the majority of their money from these categories,” the member said. “It’s going to hurt a lot of people.”

Bloggers and online businesses voiced their frustrations about the cuts on Twitter and Reddit. In a Reddit forum for affiliate marketing, one member of the program wrote: “These slashes are ridiculous. Together with a high chance of upcoming recession, SEO/affiliate outlook is pretty gloomy, to be honest.”
 

Knight

kiwifarms.net
Those rate tables say it all. People who tried to scrape out a living by dropping affiliate links/search boxes all over the internet are BTFO.
While I personally see that as a good thing this probably bodes ill for Amazon stockholders. It would be worth keeping an eyeball on future corporate decision-making as I think it safe to assume this measure is to help prop up end of year earnings which have no doubt recently dipped.
 

melty

True & Honest Fan
kiwifarms.net
Oh no, whatever will I do if I cant look for product recommendations and instead find articles like "top ten vitamin c serums you have to try right now and why they're a game-changer" that only exist to link to ten different products for commission fees instead of providing any actual information? BuzzFeed BTFO
 

Harvey Danger

getting tired of this whole internet thing
kiwifarms.net
It's not just garbage Buzzfeed Top 10 articles (which can die in a fire) getting hit, it's also YouTubers. People who review gear tend to have affiliate links in the description, and entire channels can be built on top of reviews.

Looking at the charts, that previous 10% commission on "luxury beauty" products explains a lot about why so many people did makeup videos, both tutorials and as cover for straightforward vlogs. Looks like that's been slashed to 3%, which is going to hurt.
 

Krimjob

Resident God-Emperor
kiwifarms.net
This is gonna fuck up Amazon quite a bit. The affiliate business is massive and is largely responsible for making Amazon so big in Europe. Most web stores offer between 8 to 15 percent, so not even half of that is going to deter tons of people. Gonna be real interesting to watch how this affects them financially.

Not entirely sure why they keep slashing the rates either, it's not like they're losing money because of it. Instead, they're now going to lose affiliates.
 
  • Agree
Reactions: Trapitalism

Demonslayer1776

Jogger Lover
kiwifarms.net
They're probably doing this because Amazon is so deeply engrained that they don't really need those links anymore. I'd imagine that even if the links disappeared completely, the average persons first thought would be to just look on Amazon if they wanted to buy it. The only thing I could see happening that would damage them is if another competitor capitalizes on the change and comes in to steal those link spaces by offering better rates.
 

RadicalCentrist

kiwifarms.net
They're probably doing this because Amazon is so deeply engrained that they don't really need those links anymore. I'd imagine that even if the links disappeared completely, the average persons first thought would be to just look on Amazon if they wanted to buy it. The only thing I could see happening that would damage them is if another competitor capitalizes on the change and comes in to steal those link spaces by offering better rates.
>Amazon
>competitors

:story:
 

stets

True & Honest Fan
kiwifarms.net
While I personally see that as a good thing this probably bodes ill for Amazon stockholders. It would be worth keeping an eyeball on future corporate decision-making as I think it safe to assume this measure is to help prop up end of year earnings which have no doubt recently dipped.
1) Amazon has never given a shit about propping up short term earnings. They've told investors for decades that they're almost always going to be reinvesting profit and that investors can eat shit if they expect profits or, god forbid, dividends.
2) I expect that Amazon is one of the few companies in America that are fucking crushing it and raking in cash since no one can go out and shop. They just hired more than 100k employees. I think they're profiting handsomely off of the current environment.
3) Amazon is so ingrained in online buying, especially in America, they no longer need affiliates to the extent they used to. If their dominance continues, I expect these fees will eventually drop to almost nothing, especially in certain categories, if not end completely.
 
  • Thunk-Provoking
Reactions: Lackadaisy
Tags
None