Amazon has lowered its commission rates, again!

Since March 2017, you may have noticed that Amazon.com changed the commissions (for the worse,of course), so now you get a lower percentage. Since I have a website in the computer niche (I know, I know...), the percentage dropped from 4% to 2.5%, which I have already saw as a drop of about 30 percent in revenue. So, if you want to start a new Amazon website, be aware that you will have to work your ass off for a lower percentage than before.

 

Not exactly.

Long-time affiliates get the big hit for sure given the volume of sales is already at top bracket but this is actually very good news for those who want to start doing affiliate now given it's not a volume-driven game anymore

 

Yes, it is not volume-based anymore, but, every beginner wants to become long-time affiliate at some point and it's not really viable anymore. Furthermore, why would Amazon hit the high earners is beyond any reasoning (unless more profit and less giving a sh*t about their workers...I've seen this trend with YouTube too).

 

Just because long-time affiliates have experienced big chunks of income lost does not mean this is not viable long-term.

Locally, I am a wholesaler and distributor and as one it is very important to know your margins and cut inventory which is not worth to keep. In this case, I am 100% sure Amazon has been going back and forth with affiliates given the heavy hitters are bleeding cash for them because in categories which barely make them any money, it's a huge 8%+ cut out from the top.

So, I could argue that to begin with, you shouldn't get this amount of money given it's a loss for Amazon. They were just kind enough to let it flow a little bit longer until they come to a point where the market share is so big that they won't care about people losing interest in becoming affiliates.

My two cents

 

I understand your point of view and I suppose I get why Amazon would care less what happens to the affiliates (since it got too big and the competition is pretty much stupid - the Ebay affiliate case shows this perfectly). But, most will be very frustrated to be taken back to a previous milestone and I'm sure this will show in a loss of interest for Amazon. Also, I and many others will promote a better affiliate program at a heart beat and that's why diversity in income is the wisest thing one can do.

 

I guess even beginners will lose money in most niches. You didn't need a lot of sales to climb the first tiers and get more percent of the sales than you do get now in most categories.

Amazon has increased their market share so fast over the past years that one day they have to adapt their profits according to their market share. They've been critisiced long enough now for not being really profitable that this was an easy move for them to increase profits even if it's not that much. People will use their affiliate program anyway, because it converts extremely good.

 

There's a long thread here on BHW about this from last week as well. I guess affiliates are just now catching up with the news.

 

building your income on affiliate structures is like building a nice house close to the ocean. never know if the next hurricane will rip it apart, or it will stand there nicely for 50 years...

so stop bitching

 

Since the changes, I have actually made a lot more than usual over the past few days and my niches took a hit. Lets see at the backend of the month.

 

Today is the first day of the new commisions so what you just said make no sense.

 

Amazon is too big to fail at this point so they don't care about affiliates (that much) because they don't need them (mostly). It's just business, if you were Amazon, you would probably do the same.

 

Of course that you are right, the affiliate programs are, usually, very unstable, but it is a good thing to complain when something unfavourable happens, it shows mental and social sanity and it also is a way for the bigger companies to see how the audience reacts to these changes.

Well, if we get f*cked, let us at least moan.

 

You do realize that you would have made more with the old commision system, right? It's not like the buyer thought: Hey, these poor bastards get a lower commision, let's buy more!

 

I guess Amazon is at a point where they could completly shut down the affiliate program or lower the numbers even more. Let's just be happy that they will be chasing market share and growth until you won't ever again buy anywhere else than on amazon.

And even if some niches did take a hit, there are many more affiliate programs out there that can be used. If you don't find anything that fits your need simply contact some online shops for a custom affiliate program. If you have reasonable traffic stats most will be happy about new customers.

 

Luckily my new site is in the 8% tier

 

Just do dropshipping for hot products on Amazon and using them as dropshipping partner. For hot trending products it is easy to make good money from it.

 

Yesterday and today, I can see what was bought. Yesterday I had 18 products at 8% commission, 6 at 6% and the rest 4.5% and below. Based on the previous metrics, I was well up and looking at today I am up again. Makes perfect sense. You think people just buy your own products??

 

Shutting down the affiliate program makes no sense so it's not going to happen. They want to profit as much as possible WHILE discouraging potential competitors and they know full well that by not letting anyone promote the product would mean they would lose the #1 asset they have which is market share (since people will be promoting products outside Amazon). Thus, they will still keep the aff program but this revised structure now makes so much sense especially since profit margins do differ per category.

 

Its an opportunity for others to make a great affiliate program. Since Amazon is stupid to cut its affiliate program incentives, another marketplace could counter this and force a switch of power. It's easy and fun to ride on the mistakes of the "elite" because they are fucking dumb thinking tiny mistakes don't tip the power at all. This tips the power BIG TIME.

 

Who is there to take advantage? Other stores that remotely come close are based in Eastern countries and nobody will buy waiting for products for weeks on end. Not saying its impossible but Amazon know what they are doing. They almost have a monopoly.