Starting April 21, Amazon will lower associates’ commission rates. Many people are wondering why they would risk such a change and the alienation of partners, especially on the same day their stock closed at an all-time high. This will have a big impact on their affiliates from all around the country and their livelihood's. In our opinion, we believe Amazon is making a big mistake. This is not the ideal time for Amazon to put their hard-working affiliates in this position. We are dealing with a serious global pandemic and choices like this not only effect your partnerships, but the public opinion of your company.The COVID-19 pandemic forced the government to issue stay-at-home orders to everyone. This has helped Amazon’s e-commerce business tremendously. People are not able to shop at their favorite stores, so they are researching and reading about products and services online, from the comfort of their home. So why cut the hand that feeds you, and is sending you these educated consumers that are ready to buy.
What Does Amazon Commission Cuts Mean for Their Affiliates?
Let’s say you are promoting furniture and home goods. Amazon in the past offered you 8% commission for each sale. You will now get a 3% commission for each sale. That is a huge reduction in revenue that so many businesses count on.Many affiliates are voicing their frustration and anger on dozens of online forums. Some stated Amazon commission cuts will force them to make some major changes to their lifestyle.As we stated earlier, Amazon’s announcement couldn’t come at a worse time. Their affiliates are feeling the financial crunch from the pandemic, and it seems like Amazon is not concerned about their situation. Economic uncertainty is now starting to set in for bloggers, content creators, and review site owners.
Why is Amazon Changing their Relationship with their Partners?
Everyone is scratching their head. Amazon’s profits are soaring, so why are they reducing their commission rates?Without their partners, it would have been extremely difficult for Amazon to become a global retail giant. Unfortunately, it seems like Amazon does not appreciate their affiliates.It doesn’t take a rocket scientist to see that the partnership model works extremely well. Working with partners puts companies in position to establish a solid brand. Partners also help companies set up a loyal customer bases.We feel like Amazon will learn a valuable lesson. When their partners focus their efforts on other business endeavors, there’s a strong possibility that Amazon’s sales will decline.
Can Amazon Associates Turn the Tide to Their Favor?
The sudden commission drop can be scary for any Amazon associate. Feelings of doubt, fear, and anger can settle in. However, we are happy to tell you that the world is not coming to an end.Fortunately, there are some things you can do that will protect and increase your revenue. Let’s take a close look at them.
- Don’t Give Up - This is not the time for you to give up. You must stay focused and motivated. You cannot afford to lose your focus and confidence.
- Build a Solid Relationship with Well-Known Brands - Your earnings can improve once you have a direct relationship with a variety of well-known brands. Many popular merchants have an affiliate program that will pay you well, most even better than through Amazon. The quickest way to establish the relationships is to work though Affiliate Networks like Impact, CJ and Rakuten. They have direct relationships with companies that offer generous commissions to their partners. Many of these programs also have Affiliate Managers, like iAffiliate Management, managing the program to help answer questions and establish relationships. So make sure to reach out to the program's affiliate management team and establish a rapport. If your site fits the brand well you can even sometimes negotiate for higher commission rates, or additional fees for extra placements on your site or social media.
- Diversification - There’s an old saying, “Don’t put all of your eggs in one basket.” This old adage applies to affiliate marketing. Diversifying is the key to protecting and maximizing your earnings. Better diversification, and not relying on just one channel like Amazon is essential to weathering through market changes. There’s no reason for you to depend on Amazon. Dozens of established merchants need your help. In return, they will give you handsome commissions for your efforts.
- Don't Rebrand or Change Your Niche - There’s no need for you to change your site, niche or content. You should continue down the same path that has made you successful and you have built your audience with. It will still work well with your new direct relationships. Let’s say you’ve decided to sell kitchen goods for a new partner. A simple switch of the affiliate links on your niche website will keep you in the ballgame.
- Use Data from Your Amazon Relationship - Contrary to popular belief, many merchants are interested in working with Amazon Associates. They know that many Amazon partners have the tools and skills to sell their products. It’s a win-win situation for everyone. Use that history of Amazon earnings / sales to help you get into the direct programs.
It’s fair to say that Amazon is the most recognized retailer in the world today, however realize they are mostly just reselling brands you can sell directly. So don't send your readers, or traffic to a company that doesn't appreciate your hard work when you can send it directly to the retailer and increase your revenue.If you take heed to the four simple tips listed above, you will be able to protect and increase your affiliate earnings with ease.
