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Walmart Turns to China to Grow Marketplace

Hey, Fellow Amazon Sellers!

Welcome to another edition of our weekly newsletter, packed with valuable insights and updates to help you thrive in the competitive world of Amazon selling. Let’s dive into the latest news and tips that can propel your business to new heights!

1. Walmart Turns to China to Grow Marketplace

In a strategic move, Walmart has significantly increased the number of Chinese sellers on its marketplace, with three-quarters of new sellers in April hailing from China, a record high. This shift is part of Walmart’s broader strategy to compete more effectively in e-commerce, mirroring trends seen on platforms like Amazon where nearly half of the top sellers are based in China. Walmart’s integration includes features like a Chinese-language version of its Seller Central and a beta program to simplify imports. This approach aligns Walmart closer to models like Temu and Amazon, emphasizing direct purchases from China facilitated by efficient logistics like Walmart’s fulfillment services.

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2. TikTok Shop Ads vs TikTok-to-Amazon Ads: A Strategic Dilemma for Amazon Sellers

Deciding between TikTok Shop Ads and TikTok-to-Amazon ads can be perplexing for Amazon sellers. A detailed analysis reveals that while TikTok Shop Ads might offer lower cost-per-click (CPC) rates, Amazon ads, despite potentially higher costs, might benefit from the platform’s trust factor. However, the inability to track conversions through Amazon directly due to limitations with TikTok’s pixel integration poses a challenge. To leverage TikTok for Amazon sales effectively, engaging TikTok Affiliates has proven valuable. By sending them samples and using their content as Spark Ads or directly for Amazon, sellers can enhance visibility and sales. This omni-channel approach, supported by practical experiences, suggests that running both ad types can be advantageous if managed judiciously.

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3. Arizona Accuses Amazon of Monopoly and Deceptive Practices

Arizona’s Attorney General, Kris Mayes, has filed two lawsuits against Amazon, alleging violations of state consumer protection and antitrust laws. The first lawsuit claims Amazon uses deceptive “dark patterns” to make canceling Amazon Prime subscriptions difficult, paralleling an earlier FTC lawsuit. The second accuses Amazon of monopolistic practices by preventing sellers from offering lower prices elsewhere through restrictive agreements, a practice also challenged by other states. Additionally, the lawsuit targets Amazon’s Buy Box algorithm, claiming it misleads consumers into overpaying by favoring products that generate higher fees for Amazon. Arizona seeks to halt these practices and obtain civil penalties.

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4. Temu Reduces Focus on U.S. Market Amid Regulatory Scrutiny

Temu, the Chinese e-commerce app that rapidly gained traction in the U.S., is shifting its business strategy to reduce dependence on American consumers. Owned by China’s PDD Holdings, Temu is diversifying its growth avenues due to the increasing scrutiny on TikTok by U.S. authorities, which has raised concerns about the regulatory environment. This strategic pivot comes despite Temu’s initial success in becoming one of the most downloaded apps in the U.S. The company is now looking to mitigate risks and explore growth opportunities in other markets.

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5. Beginner Seller Mistakes in Launch Strategy

Alex highlights common pitfalls that novice Amazon sellers often encounter. He outlines a scenario where a new seller targets a niche with high sales volume, copies an existing product, and orders the minimum quantity due to fear of overcommitting. Despite the competitive market, they price their product 20% above the average hoping for immediate profits. This results in a disappointing sales rate of just 2-3 units per day, underscoring the challenges of entering a saturated market without a competitive pricing strategy or adequate market research.

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6. Amazon’s Numbers Game: Key Amazon Statistics

Amazon continues to assert its dominance in the global e-commerce space, reflecting a meticulous strategy of innovation and customer-focused services. As of 2024, the platform commands 37.8% of e-commerce sales, showcasing substantial growth with a 14% increase in net sales, totaling $170 billion in the last quarter of 2023. Amazon boasts over 310 million active users and processes approximately 4.79 billion U.S. delivery orders annually. The vast product range on Amazon, exceeding 12 million items, underlines its comprehensive market presence. These statistics not only highlight Amazon’s market leadership but also its crucial role in shaping digital commerce dynamics.

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7. eBay Brings Auctions to the Fore but Is It a Winning Bid?

eBay is reviving the excitement of online auctions, a stark contrast to its focus since 2008 on fixed-price listings. A recent promotional email by eBay stirred nostalgia among users, highlighting the thrill of winning auctions and finding unique items. This pivot back to auctions involves encouraging users to engage more interactively by asking sellers for additional details such as more pictures or specifics on combined shipping options. With a historical shift towards convenience shopping, eBay’s re-emphasis on auctions raises questions about its current strategy and whether this shift will successfully re-engage users or if the platform should pursue different marketing avenues.

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8. ChatGPT Just Made AI More Human, and It Should Make Its Rivals Nervous

OpenAI has significantly advanced the capabilities of ChatGPT with its latest GPT-4o update, enhancing the AI’s ability to interact through audio, vision, and text in a remarkably human-like manner. This update not only improves voice modulation and emotional expression but also introduces real-time interaction capabilities, making it feel much closer to human conversation. These enhancements are setting new standards in the AI industry, challenging competitors like Google, Apple, and Amazon to elevate their technologies. The timing of this release, just before Google’s major AI event, positions OpenAI at the forefront of the AI dialogue, showcasing its lead in creating conversational and emotionally intelligent AI systems. This technology is also instrumental in aiding businesses like ours to generate compelling copy and graphics for Amazon listings, enhancing product visibility and customer engagement.

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9. Boomerang for Gmail – Never Forget About an Email

Boomerang for Gmail has become an essential tool in my email management strategy, ensuring that I never forget about important messages. One of its standout features is the ability to set reminders to follow up with recipients within a specific time frame. Whether it’s crucial business communications or personal matters, I can choose to be reminded if I don’t receive a reply or simply set a general reminder regardless. This ensures that no messages slip through the cracks, and I never miss an opportunity to follow up with people. With Boomerang’s reliable reminders, my email workflow is more efficient and effective than ever before.

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Stay tuned for more updates and tips in our next newsletter. Until then, keep innovating and optimizing your strategies for success.

Happy Selling,

Todd Welch
Amazon Seller School