Do you know any recent juicy news? Or have you heard of anything interesting about the ecommerce industry?
Because we do—and we’re starting this week right by sharing them with you!
- Amazon fraudsters arrested after 5 years ➿
- The best UGC sourcing partner 🤝
- TikTok is NOT for sale 🚫
- Amazon’s competitive pricing secret 🤫
POST OF THE WEEK
BLACK MARKET
Want to hear something extraordinary?
Amazon got defrauded for $19 million!
Last April 24, EcommerceBytes recalled how 4 brothers—Yoel, Heshl, Zishe, and Shmuel Abraham—manipulated the vendor system to try milking the retailer for $32 million. Fortunately (or not), they got only $19 million.
Here are more deets about the unscrupulous scheme:
🔫 Busted after 5 years
- The Abraham brothers ran their dark plan from 2017 to 2019 before being arrested on April 24, 2024.
- In the unsealed indictment, the culprits opened vendor accounts on Amazon to “supply specific goods, at specific prices, in specific quantities.”
- But the brothers used an “overshipping” scheme, substituting the orders with overinflated goods and charging Amazon for excessive quantities!
The Southern District of New York charged the brothers with conspiracy to commit wire fraud, wire fraud, and money laundering. However, the press release of the arrest says they are considered innocent until proven guilty.
📌 What to do if this happens to you?
ICYDK, the crime falls under invoice fraud. Fraudsters committing this illegal practice don’t just target big enterprises. So, if you feel like they’re targeting you, here are several things you can do:
- Educate your team about the risks of invoice fraud.
- Regularly track invoice activities and monitor the invoice amounts.
- Check in with your suppliers to ensure all payment and billing details are updated.
- Go digital to easily filter fake requests (requests with mismatched payment details).
If a giant company like Amazon is getting justice after 5 years, imagine how long smaller companies can get theirs. So, stay sharp and watchful to prevent fraudsters from getting in your way to success. 👀
TOGETHER WITH INSENSE
5 characteristics of the best UGC sourcing partner
UGC for TikTok, Meta, and Amazon Ads drives higher conversions because it’s full of social proof - but how can you easily source high-quality UGC at scale?
Enter Insense.
Insense is the leading platform for UGC and influencer marketing, trusted by 1,500+ brands including Malouf, Rankster, and Upper Echelon Products.
“We tested 20+ platforms before Insense, we love how we can manage all our campaigns and get content in only 2 weeks” - Paul Harvey, Rankster
Insense stands out because:
- Creators apply to you: responsive UGC creators apply directly to your campaigns in minutes
- Delivered in 10 days: receive high-performing UGC for organic + paid social
- Simplified admin work: automated influencer agreements, payments, and digital content usage rights
- Money-back guarantee: if an influencer ghosts
- Repeat + long-term collabs: build relationships with influencers and UGC creators
Try it now!
Book a free 1-2-1 strategy call and get $200 for your first campaign.
BITES OF THE WEEK
- Cutthroat Competition: Did you know5 million sellers have joined Amazon since 2018?
- A Cat-tastrophe: A couple accidentally shipped their pet in an Amazon return package!
- Seller Webinars: The next round of free webinars is about B2B—maybe you should join.
- May Ideas: Here are some content ideas based on what's happening this May.
HOT TOPIC
TikTok is NOT for sale
April 24, 2024 surely is an eventful date. Aside from the arrest of fraudsters, it was also when President Biden signed a law that increased the tension between the country and TikTok.
The approved legislation officially gives ByteDance, TikTok’s parent company, 9 months (plus a 3-month grace period) to sell the platform or be banned in the U.S. However, as reported by BBC, ByteDance has no intention of selling TikTok.
😖 A tale of paranoia?
In case you’re wondering how the ban issue started, here’s the story:
- As Beijing gains more control over private companies, the U.S. and other Western countries are questioning how much influence the Chinese Communist Party has over ByteDance and its data.
- Specifically, U.S. lawmakers fear the Chinese government will intimidate TikTok to share the data of its 170 million U.S. users.
- But ByteDance firmly says the Chinese government has no control over the company or its data.
- This is supported by a statement from the Chinese government, implying that the U.S. has unfounded paranoia.
How will this affect U.S. sellers on TikTok Shop?
While the ban seems like a big ecommerce issue, a survey revealed that the impact on U.S. merchants will be minimal. Around 60% of TikTok users (a.k.a. potential buyers) say they’ll just migrate to other platforms (like Facebook or Instagram).
So, the solution for U.S. TikTok Shop sellers is simple—migrate their business to where the users will go. ✈️
SELLER REFRESHER
How Amazon keeps prices competitive through 4 things
Amazon’s goal is to be the most customer-centric company in the world. To do this, they price products competitively to be the most affordable place to buy goods.
✍️ According to eComEngine, Amazon’s competitive pricing policy relies on two factors:
- Featured Offer (Buy Box). Amazon typically features sellers with the lowest prices.
- Competitive price threshold (CPT). Amazon sets the threshold based on prices on and off Amazon. Buy Box suppression may occur if Amazon's lowest price is still higher than retailers off Amazon.
So, how does Amazon do it?
By focusing on 4 things!
- Average selling price - calculated based on the past 60 days' average price weighted by units sold, excluding promotional deals.
- Price by Amazon - the highest price a product sold and shipped by Amazon has been listed in the last 14 days.
- Per-unit derived price - calculated by multiplying the price-per-unit of a Featured Offer from a smaller bundle by the number of units in the listing.
- Product list price - the suggested retail price of the manufacturer, supplier, or seller.
💡 How should you use this information?
There’s only one way to use them—as a guide. Because to price your products competitively, you need to monitor your own numbers when:
- You won or lost the Buy Box;
- Your listing status changes;
- There’s suspicious activity in your listing, such as hijacking; and
- The Buy Box is suppressed.
In short, staying vigilant is the key. But don’t worry, there are tools you can use to be a ‘competitive pricer’ in the fluctuating marketplace.
