On July 19, US time, Amazon officially sued more than 10,000 Facebook group owners. This is the largest legal lawsuit against overseas reviewers in Amazon's history. What this will mean for every Chinese seller, today's article Huiwang will conduct a detailed analysis for you.

Part 1: Outrageously, over 10,000 FB group owners were sued

According to a report by CNBC, Amazon launched a judicial lawsuit in a Seattle court last Tuesday against more than 10,000 administrators involved in Facebook's testing group.

The memorization data in the report is pretty staggering:

More than 10,000 people have been sued, among which the Facebook groups that have been sued include Amazon Product Review (43,000 people), Amazon Varified Buyer & Seller (2,500 people) Facebook has closed more than 5,000 groups involved in evaluation, and is in the process of reviewing the remaining groups. of group conduct to review

At the same time, although Amazon is temporarily unable to estimate the specific amount involved in the fake transaction, the relevant figure is likely to be an astronomical figure.

In terms of prosecution fees, litigation in the US court is very expensive, and it involves the collection of evidence before the prosecution, so from this massive lawsuit by Amazon, it can be seen that Amazon has decided not to leave any false evaluations. .

Part 2: What does Amazon want from judicial action?

Since many of Facebook's information is not publicly available, it is not easy to obtain the specific contacts and chat records of each group. At the same time, Facebook has banned the exchange of free products for evaluation through its platform since 2020. If you detect Review, Rating, Amazon and other information accounts will be directly reviewed and closed, so many evaluation groups have become secret groups and replaced evaluation words with characters such as Re**w when chatting.

According to Amazon’s instructions, Amazon and Facebook have established a common review team and will obtain evidence of violations and laws in the relevant communities through litigation.

In terms of litigation steps, Amazon first needs to:

1. Determine the actual identity of each individual in these groups;

2. Understand all the illegal gains involved in reviews, which often include commissions of $5-20 for reviews

3. Historical records in all groups, including product listing information and evaluation access information

According to Hui.com's understanding of similar judicial prosecutions in the United States, if Amazon's first step is to sue the Facebook group owner, then I believe that the second step will be to sue all the team members participating in the evaluation and require them to pay Amazon All involved product amounts and review commissions, and provide all Amazon sellers and product information in exchange for freebies.

In the third step, Amazon will review the account of the relevant seller, and may freeze the account of the relevant seller.

Part 3: How Chinese sellers should respond

If the incident will develop according to the above estimates, in terms of time, Chinese sellers involved in obtaining illegal evaluations will successively receive Amazon’s evaluation notices for illegal evaluations in the next 3 months to 2 years.

There may be a concern here, that is, doing Amazon basically involves the fuzzy area of ​​obtaining evaluation, so the above case may involve every Chinese seller.

However, every case in the US judicial system must have sufficient basis and evidence, and this will involve a time point when Amazon updates its review policy and clearly states that it is obtained by giving away products, discounts or gifts. The date on which the review will be considered a violation. Of course, there is also a time point when the U.S. court classifies the above behavior as a false transaction.

Although we have not seen the history of Amazon's policy updates and corresponding dates in the above two times, judging from Amazon's blog, this time should be June 16, 2021. That is to say, the off-site delivery test before this date may not be the focus of Amazon's investigation, but Amazon will delete all confirmed violation reviews.

However, Huiwang recommends that everyone still pay attention to the progress of relevant judicial proceedings and make the following adjustments as far as possible:

1. Apply for a new Amazon seller account

2. Authorize the brand management rights of the previous account to the new account

3. Listing of new accounts and old accounts

4. Start shipping with the new account and reduce the FBA inventory of the old account

5. Let the old account funds return as soon as possible

Part 4: Old sellers and Amazon's own business make room for new products

According to the above speculation, in the next 3 months to 2 years, reviews of old listings should be removed or even taken off the shelves. News that the number of branded items will be drastically reduced from now on.

In fact, from the entire Amazon platform, the real threat to third-party sellers is Amazon's own brands. To put it simply, if you look at the current 50 products in Amazon's precision category, you will find that Amazon sells more and more products. And as long as Amazon sells products, it seems that the number of reviews is very large, and the price is very cheap.

According to the Wall Street Journal, Amazon’s decision to slash the number of private-label products was driven by three main reasons:

1. Bezos once hoped that Amazon's own brand accounted for more than 10% of the total sales of Amazon's market, but now it only accounts for 1%

2. Many Amazon-owned brands suffer heavy losses

3. U.S. antitrust law is investigating whether Amazon unfairly competes with third-party sellers through non-public data on its own platform

Several Hui members asked us on WeChat last week whether the withdrawal of Amazon's own brands meant that Amazon's marketplace is now difficult to do. However, Hui.com learned that Amazon's operation actually made a mistake, that is, it allowed itself to have too many SKUs and turned itself into a distribution-type seller. The profits of many Amazon-owned brands, such as Amazon Basics batteries, have been dragged down by most of the products with no sales and no profit, making the overall operation of Amazon's own brand very bad.

At the same time, the Wall Street Journal also said that Amazon has now begun to think that it should be clearly positioned, that is: it is more of a platform to facilitate transactions, not a seller!

And its Buy with Prime launch for independent stations will allow Amazon to start reaching out to every independent station.