news

Produced by Huxiu Business Consumption Group

Author: Li Xiangxue

Editor: Zhou Yueming

Title image｜Visual China

If we talk about the most explosive news in the cross-border circle recently, it is probably the cooperation between Amazon and TikTok.

This cooperation reminded many people of the scene of Douyin and Taobao's mutual communication in the early years. Many industry insiders couldn't help but want to see how many new opportunities this "marriage" could bring.

However, when many sellers were gearing up to invest in TikTok to promote their products on Amazon stores, they found that they had no chance to participate in this collaboration.

“Regarding the official blog content ‘Shop select Amazon Ads on TikTok without leaving the app’, many customers are asking how to operate the binding:Currently, this cooperation is limited to Amazon's first-party advertising on TikTok, so it does not need to be bound to Amazon's third-party merchants and is not applicable. It is still unknown whether this function will be open to Amazon's third-party sellers in the future.Please tell the merchants who have questions, thank you. "When someone asked the official manager of TikTok, this was the reply.

“We have not found an option to select TikTok-related sections in the Amazon backend.This cooperation has little to do with individual merchants."Ye Zijia, founder of Xinque Technology, which has been deeply involved in the North American TikTok and Amazon markets, also told Huxiu.

In the view of some industry insiders, this news is more of a signal, but it has not yet been confirmed what Amazon’s mechanism for displaying products is, and its specific plans remain unclear.

However, one thing is clear: under the increasingly fierce attack from China's cross-border e-commerce platforms, Amazon is eager to change, and the tactics it uses are becoming increasingly familiar to Chinese e-commerce companies.

Frequent changes

Amazon really needs to take action.

According to Amazon's recently released second-quarter financial report, its online sales growth slowed down, with net sales of e-commerce business reaching $55.39 billion, up 4.6% year-on-year, lower than analysts' expectations of $55.55 billion. Due to factors such as the economic downturn, consumers are more cautious when shopping and tend to look for cheaper goods. This trend caused Amazon's stock price to plummet nearly 8% in after-hours trading.

According to data from mobile analysis company GWS, Amazon's UK app has lost more than 1 million users since the beginning of 2023; since April, the number of daily users on the US site has dropped from 54 million to 46 million.

In contrast, competitors are growing rapidly.

According to the 2024 Mobile Market Report released by market analysis agency data.ai, SHEIN won the championship in global shopping app downloads in 2023, while Temu, Amazon and Aliexpress ranked second, third and ninth respectively in shopping app downloads in 2023. The penetration rate of Chinese cross-border e-commerce brands represented by SHEIN is still rising.

Against this backdrop, it’s not surprising that Amazon is taking so many actions.

• In June this year, Amazon announced the launch of the "Low Price Store" project, joining the fierce full-hosting battle among cross-border e-commerce platforms.

This is a store that specializes in providing customers with white-label low-priced fashion, home and daily necessities products. Sellers who enter the low-price store can choose products and set prices on their own (within a certain range), fulfilled and delivered by Amazon’s warehouses in China, it is expected that the goods will be delivered directly to customers within 9 to 11 days.

In low-price stores, the price of the goods sold must be less than $20, the weight must be less than 1 pound, and the size must be within the range of 14*8*5 inches. In addition, low-price stores also set up a "refund only" policy. For goods below $3, refunds are not allowed, and for goods above $3, only refund mode can be selected.

• On August 8, it announced its partnership with TikTok.

Previously, Amazon also reached a platform-level cooperation with Meta (Third-party sellers are not involved). Through Meta's social platforms Facebook and Instagram and Amazon's "shared accounts", users can directly log in to the social platform (Facebook and Instagram) and the relevant products will be delivered to the Amazon delivery address saved by them.

• andOn August 14, there was news that Amazon’s US site sent a notice to a large number of sellers, expanding the scope of “refund only” products, and changing the product range applicable to the “refund only” service from products below US$25 to products below US$75.

It can be seen that Amazon is trying hard to defend itself, so what will be the effect of these moves?

Not yet a big push

"Amazon's strategies give people the impression that they are just making a lot of noise but not delivering any results," a senior source told Huxiu. "They are more like sending out signals and testing everyone's reactions, but most of them are still in the planning stages and have not yet been launched in a big way."

For example, the low-price store project announced in June was jokingly called the "Yaduoduo store" by industry insiders. It is revealed that the project is still in internal testing and has not yet been officially launched or recruited in large numbers. There are reports that goods will not be accepted for storage until autumn.

"However, many merchants are still willing to join. Some people will even spend hundreds of thousands to buy a store quota from others. In the initial stage of the project, there are not many spots." Ye Zijia told Huxiu.

For example, on August 14, Amazon announced a new "refund only" policy, which expanded the scope of products eligible for the "refund only" service from less than $25 to less than $75.However, Amazon still provides sellers with a way to manually disable this feature., and set stricter refund-only conditions (Only sellers with good credit as defined by Amazon can register for the option of refund without return. High-priced goods, dangerous goods and heavy and bulky goods are not included in this service scope for the time being.）。

The same is true for the much-anticipated collaboration with TikTok. Currently, most people still don’t know how Amazon will display its products on TikTok.Many people speculate that Amazon is more likely to sell its own products.), it is still unknown whether third-party seller channels can be opened in the future.

From the outside, the cooperation between Amazon and TikTok brings many benefits to TikTok. It can not only increase advertising revenue, but also obtain e-commerce data. Cooperation with local American companies can also ease its pressure from a political perspective.

But how much benefit will it bring to Amazon? It is still unknown how much Amazon's cooperation with Meta in November last year has improved its performance. The effect of continuing to cooperate with social platforms such as TikTok is worthy of the industry's attention.