Amazon Echo Dot Promotion Gone Wrong: What Sellers Can Learn From Amazon’s MistakeSeller Labs
By now you’ve likely read about the Amazon Echo Dot promotion SNAFU that took place over the weekend. It seems to have been a promotion gone awry wherein, for a brief window on Friday afternoon, Prime customers adding the Echo Dot to their carts and proceeding to checkout were treated to a 100% price reduction (from $49.99 to $0.00) as attributed to an Audible promotion.
Did You Get a Dot or Not?
Maybe you not only read about the incident but you participated in the promo and “purchased” a Dot on Friday when the price zeroed out. Or maybe you went to do so and were notified that the product was no longer available. If you did order a Dot (or multiple Dots) during the promo window, you experienced one of the following as a result (or you will soon enough):
- You got lucky and your Dot[s] shipped nearly instantly before Amazon could cancel anything or pull Dots back from a delivery. Enjoy the error in your favor.
- Your order did indeed ship (or at least start the shipping process) but it will not be delivered because it was intercepted by UPS or USPS per Amazon’s instructions. Sorry for getting your hopes up, boo.
- Your order was canceled before it shipped and you were either notified by email or you were not notified and the order was simply moved to Canceled status. Bummer, but no harm and no foul really as it cost you nothing. In these cases, you likely received a $5 credit as compensation. You know, so you can spend more money shopping on Amazon.
Whether or not you got your Echo Dot seems to depend on your delivery proximity to a fulfillment center with Dots in stock, the time and quantity of your order, your shipping method, a bit of luck (or lack of luck), and the mysterious ways of the Amazon juggernaut in all of its automated logistic glory.
How on Earth(‘s Biggest Selection) Did This Happen?
The Internet loves conspiracy theories as well as tales of AI gone rogue, so of course there are theories that Amazon was hacked, but those posts are few and far between, not to mention far fetched. Another theory is that there was a glitch, a bug or some other erroneous code that combined for a fluke resulting in a flurry of Dots from heaven. This also seems unlikely.
You know what seems to be the most plausible explanation for the promo? The combination of a somewhat-confusing promotions interface and good old human error. Remember that Amazon owns Audible so a big cross-promo such as “Buy a Dot, get a free year of Audible” or “Subscribe to Audible for a year, get a free Dot” could have been in the works when someone forgot to enter a condition of the deal and the promo went live. I can’t prove that this is what happened, but as a believer in Occam’s Razor, it feels a satisfactory possibility to me.
Irony: Not Just for Hipsters, Now for Mega-Corporations Too!
Perhaps most interesting for Amazon sellers is the irony of all of this, an irony that sellers who have run promotions will well understand, namely that of promos gone awry and this time, Amazon being on the receiving end of that, especially as a company that is notorious for being ruthless and immune to human error.
To be clear, Amazon Promotions are wonderful things for both buyers and sellers. In fact, we just wrote about how useful promos can be when trying to clear out FBA inventory before semi-annual long-terms storage fees are assessed. However, promos can also be tricky, and as Amazon experienced, they can go very wrong and get very costly in mere minutes or hours. Every seller dreams of his or her product going viral, of being mentioned or covered by an influencer and then picking up so much steam that Amazon is flooded with searches and sales. But a promo going viral is kind of the dark side of a product going viral in that it snowballs and the originator has no control over any subsequent avalanche of fallout. Viral-inspired demand is awesome . . . unless you’re accidentally giving your product away because you forgot a variable in the promotions creator. And as plenty of sellers will attest, once the deal is on, Amazon is not going to help you recoup any losses whether it’s your fault or a case of a customer simply taking your deal for all that it (and you) are worth.
In the case of the Echo Dots, Amazon seems to have been hoist by its own petard in a simple combination of a confusing promo interface coupled with a human error. While we don’t know exactly what happened (or what was intended), we do know that something went terribly wrong in this case, just as it has gone similarly wrong for many sellers creating promos. The difference, however, is that when it happens to Amazon, it gets fixed fast (cancellation and compensation on Amazon’s terms). Amazon is big enough to absorb the blow and ship some free product and apologize to some customers and to throw those who were denied a small credit. When it happens to a seller, it’s a very different story with very different consequences. In this case, the seller is at the mercy of Seller Support representatives who are often powerless, not helpful, or purveyors of conflicting information and the damage already done can be so great that massive amounts of inventory are lost and the business crippled or even forced into collapse.
My hope is that the Dot debacle will result in something other than a data-entry employee losing his or her job because of a screw-up (however costly). My hope is that instead, Amazon rethinks how it offers Percentage Off promos as well as how it provides sellers with a promotions interface with which to create Percentage Off deals. Hey, if it happened to Amazon in all of its capabilities and fail-safes, it surely can happen to a seller working in the labyrinth of Seller Central.
If It Happened to Amazon, It Can Happen to You. Protect Yourself.
In the meantime, here are some things that you, as a seller, can and should do to protect yourself from promos gone awry.
1) Read Seller Central Help on Promotions, especially the parts about Creating a Promotion, Editing a Promotion, and Canceling a Promotion.
2) Read other sellers’ stories and learn from their mistakes:
Seller Central Threads:
- Help, Promotion Gone Wrong
- Help Promo Code Scam (Note that this is not a scam so much as customers exploiting a seller’s)
- Mother’s Day Promotion Gone Bad
Misc. Postings About Terrifying Experiences with Amazon Promotions:
- Reddit.com: A Customer on Amazon Abused a Promotional Code I Gave Them and Now I’ve Lost ~$50,000 in Inventory
- Hibermate: Amazon Promotions – I Just Cost My Company USD $45,000 with One Assumption.
3) Practice with Promos: In your Seller Central account, play with the tools there so that you get familiar with what you can do. Create tiny promos that run for short spans (so that you don’t do much damage if you make mistakes) and check the results often so you can see how these promos play out in terms of real sales and you can stop the promos or adjust them as necessary.
4) Understand Group Claim Codes: According to Amazon, “Group claim codes have no quantity limits. If the group claim code is posted on a social media site, your entire inventory could sell out in a short amount of time. If this is not what you want, you can use Single-Use claim codes:
- Select the “Claim Code” checkbox
- Click the “Customize messaging” text
- Unselect the “Detail page display text” checkbox
After creating the promotion, view the promotion and press the “Manage claim codes” button
Alternatively, you can limit orders with the claim code by setting your inventory levels to the desired amount for merchant fulfilled products or for FBA products. This way you ensure you only have the desired amount of products in stock at our facilities. A super easy way to do this is by using Seller Labs’ free inventory protection tool, Max.
5) If Percentage Off promos stress you out, don’t run them.
Assessing Dot-Gate 2017
What happened this past weekend with the Echo Dot/Audible promo is actually both a loss and a win for Amazon. It’s a loss in that it will cost Amazon a goodly amount in products and delivery costs and promo reimbursements. As well, they’ll take a hit in reputation from people who expected their free Dots are now hot-mad that they are not receiving those, especially when others got theirs. But no one stays mad at Amazon for long and no one can really avoid shopping on Amazon so it’s a bit like Stockholm Syndrome where we all love our captor and return to it.
The win for Amazon is that everyone is talking about Amazon Echo Dots and now a lot of people who wouldn’t have bought them will have the devices and use them (in large part to order more items via Alexa voice command). And let’s not even talk about the ridiculous amount and detail or data that Amazon will collect from all of that Alexa interaction. Or the fact that Amazon has now cleared out of the Echo Dot 2.0 inventory and can be ready to roll out 3.0 and show us how and why we can’t live without that latest version of the device.
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