Tambo | Weekly Amazon update | Subscription Boxes, pay-to-play with ads, cashierless tech expands and Amazon Germany's anti-trust case

Amazon launches a Subscription Box service in the US

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Amazon has launched a new Membership & Subscriptions section that features subscription & discovery boxes like Allure Beauty, STEM Club and Carnivore Club. Brands and subscription sites are able to list their offer on Amazon and reach the millions of Prime users that they may not have had access to in the past. The boxes are ideal as gifts for friends and family, hence the timing of the launch, and are a great way for people to discover new product related to their interests. The four main categories are beauty and lifestyle, toys & kids, food & drink and pets. Amazon is offering significant discounts on the first box, up to 40% off in some cases. You can customize the contents of the box based on the seller selection, every box is backed-up by Amazon's guarantee and the customer can cancel at any time. Whilst the range is fairly limited at the moment and exclusive to the US, this service could easily be replicated elsewhere to help Amazon become a global destination for subscription boxes. 

Pay to play with Amazon advertising


A new study has found that Amazon's focus on sponsored placements is transforming the platform into a 'pay-to-play' arena where brands must advertise in order to stand out in a competitive market. The 5-day study over the 2018 Thanksgiving weekend, analyzed 1 million orders generated by over 100 brands to reveal a clear trend of growth in sponsored placements. The study found that orders generated by ads increased by 54% in 2018, moving from 16.3% in 2017 to 25.1% in 2018, with some categories – such as Home and Kitchen – demonstrating a higher “ad dependency” than others. Furthermore, another report out this week showed that Amazon's sponsored products were converting at three and a half times the rate of Google Shopping Ads. 

Even consumers are noticing Amazon's increasing focus on advertisements as the site's design has changed recently to accommodate the many ad types visible on a typical search page on the site. 70% of consumers will not look beyond the first page, placing greater pressure on brands to look to advertising for visibility as organic placements get squeezed down.

Cashier-less tech tested in bigger stores


Amazon Germany antitrust probe


Amazon's "double role" as Germany's largest retailer and biggest online host for smaller stores is the target of an antitrust probe into the terms the company sets for other sellers, the German Federal Cartel Office has announced. The investigation into Amazon's biggest market outside the US adds to European Union scrutiny of whether the company gathers information on rival sellers' successes to help launch its own products. German regulators said they'd received "numerous" complaints from sellers.

The authority will be looking at terms of business and related practices that breach antitrust rules. That includes liability provisions that could disadvantage sellers, contract clauses that restrict where sellers can take lawsuits against Amazon, rules on product reviews and the non-transparent process of blocking and closing seller accounts. The probe will also look at withholding or delaying payment and clauses that assign rights to use information a seller must provide on the products it offers and the terms of business for delivery. To prove the case, the German authority must provide evidence that Amazon holds a "dominant position", or that the sellers are dependent on the company.