[ BDSN ] Amazon refund loophole may be costing you thousands

In partnership with

STUMP BEZOS

How many keywords can you add to a single ad group when advertising as a 3P seller on Amazon?

[ Answer at bottom of email ]

🗣️ DIRTY SECRET of the AMAZON REFUND INDUSTRY

Noticed lately that everybody and their dog has jumped into the Amazon refund space? I think my maid even recently offered to do refund processing for me.

It’s getting super competitive because there is A LOT of money to be found. But it’s not as easy as it sounds, and some companies are taking advantages of loopholes that you need to be aware of (and in some cases it’s how they offer lower fees - by taking money that is 100% rightfully yours.)

There is a flaw in Amazon's automatic reimbursement system that is being exploited by some Amazon refund services.

Getida revealed this loophole for the first time at BDSS X in Hawaii last month, then again in a Linkedin post and video you can watch (link at end of story).

Here's what's happening:

  1. Amazon has a system to automatically reimburse sellers for failed customer returns (when a customer gets a refund but doesn't return the product).

  2. Amazon's system is supposed to process these reimbursements after 60 days, but due to system error, it actually processes them after 64 days.

  3. Some refund providers exploit this 4-day "loophole" by filing reimbursement claims between days 60-64.

  4. These providers then charge sellers a fee for obtaining reimbursements that would have been automatically processed by Amazon within a few days anyway.

  5. This practice wastes Amazon's support resources and potentially costs sellers unnecessary fees.

How to check and get a refund from your refund company:

Contact your refund provider and request them to either:
 a) Not handle failed return cases at all, or
b) Wait 90 days to file claims for these cases

  1. After 90 days, check if they respected your request by following these steps:

  2. In Seller Central, go to Reports > Fulfillment > Reimbursements

  3. Look for reimbursements related to customer returns that have a case ID

  4. Note the Amazon Order ID for these reimbursements

  5. Go to Payments > Transaction View

  6. Enter the Order ID and find the date when the customer received their refund

  7. Go to Case Log and find the case ID noted earlier

  8. Check the date when the case was opened by your provider

  9. If the case was opened less than 90 days after the customer refund date (or before your specified timeframe), compile these instances in a spreadsheet

  10. Calculate the total fees charged for these premature claims

  11. Contact your refund provider with this evidence and request a refund for the unnecessary fees charged


    Watch this video for more information

By following these steps, you can identify if they've been charged fees for reimbursements they would have received automatically from Amazon, and potentially recover those unnecessary charges from their refund provider.

🌎 STATS YOU SHOULD KNOW

* Ownership percentages as of 2023

💸 POTENTIALLY SAVE THOUSANDS on FBA FEES

Helium 10 has just released a powerful new feature that could potentially save you thousands of dollars on your FBA fees.

The new feature is called "Size Tier Optimization Suggestion." It analyzes your entire inventory and identifies products that are just on the edge of different size tiers.

By suggesting minor size adjustments to your packaging, it can help you move products into more cost-effective size categories.

Why it's important:

  1. Significant cost savings: Even small reductions in package dimensions can lead to substantial FBA fee reductions.

  2. Increased profitability: Lower fulfillment costs mean higher profit margins on your products.

  3. Competitive advantage: Optimizing your packaging can help you price more competitively while maintaining profits.

How to access and check it:

  1. Log into your Helium 10 dashboard.

  2. Navigate to the Alerts page.

  3. Look for a message that says "Products with size tier optimization suggestions."

  4. Click on the button with a number next to it (indicating how many products have suggestions).

  5. Review each product suggestion, which will show you:

    • The current size tier

    • The potential new size tier

    • How much you need to reduce the package size

    • The potential cost savings per unit

For example, one product might show that by reducing the length by just 1 inch, you could move from a "large bulky" to a "large standard" size tier, potentially saving $3.75 per unit in FBA fees. For a product selling just 5 units per day, this could translate to over $7,000 in annual savings (EXTRA PROFIT!).

I strongly recommend using Helium 10 and checking this feature regularly, especially before placing new inventory orders. It's a simple way to potentially save thousands of dollars across your entire catalog. Remember, even if you can't adjust all products, implementing changes where possible can significantly impact your bottom line.

And what if you do change packaging (either the look of it or the size). How do you handle that on Amazon on your product listing page for customers so they are not confused?

Here’s a great example of what to do Jon Derkits recently shared on X:

Like BDSN? Forward this email to a friend!

If you’re that smart friend, subscribe now! 

It’s quick and easy to subscribe yourself, plus
it’s FREE → new issues every Monday and Thursday

Use the link to REFER a FRIEND
AND GET FREE STUFF!

🦋 VALUE of SOCIAL PROOF for BEAUTY BRANDS

NYX Professional Makeup ran an illuminating A/B test on their e-commerce site to measure the impact of social proof.

Social proof is a psychological phenomenon where people look to the actions of others to guide their own behavior. In marketing, it leverages the idea that consumers are more likely to purchase products that are popular or endorsed by others.

They compared two social proof messages against their original product page design.

The results were striking:

Control: Original product page with no social proof message Baseline for comparison.

Variation 1 ("Viewed"):

  • 32% increase in click-through rate

  • 33% boost in transaction rate

  • 38% reduction in bounce rate

Variation 2 ("Purchased"):

  • 43% jump in click-through rate

  • Doubled the transaction rate (100% increase)

  • 38% drop in bounce rate

While the "purchased" message was the clear winner, the "viewed" message also delivered impressive improvements over the original design.

The "viewed" variation sparks curiosity and implies popularity, while the "purchased" variation adds a stronger element of social validation.

Consider testing different phrasings, applying the technique to more pages, and experimenting with urgency-based messages. You might even try combining "viewed" and "purchased" data for a more comprehensive social proof message.

In the beauty industry, showcasing what's trending can be as crucial as the product itself. This technique does just that, transforming browsers into buyers by highlighting real-time popularity. A small change can make a big impact on your bottom line.

Maximize Sales with Strategic Influencer Partnerships

Join the marketing revolution with Stack Influence, where micro-influencers aren't just promoters—they're real customers. Their authentic endorsements help elevate your brand's credibility and boost sales, as proven by our success stories with major brands.

💲 WHY AMAZON BUSINESSES get LOWER MULTIPLES

If you’re interested in selling your e-com business soon, you probably have a lot of questions due to the current state of things in the acquisition space.

  1. How much can you get for your biz in 2024?

  2. What multiple should you expect?

  3. What terms should you expect when you sell it?

Quiet Light analyzed 70 deals that sold from January 1, 2023 - May 15th 2024 to show you the current market for eCommerce and Amazon SMB multiples (which are lower than DTC multiples).

They took key information on these deals after they closed to give you more insights than just numbers alone.

They put all this together and more in a FREE 18-page PDF report,, plus they added 12 strategies and tactics to increase valuation to help maximize your exit.

Download the FREE PDF here

LAST TWO BDSN NEWSLETTERS …
June 20 → 🐶 Rufus is on the loose & Amazon is cracking the whip
June 17 → How to get 99% open rates on Amazon promos

KEVIN’S LATEST AM/PM PODCAST:

🔥 MORE HOT PICKS 🔥

🥃 PARTING SHOT

“People don’t want to buy a quarter-inch drill. They want a quarter-inch hole.”

Sell the hole, not the drill.

Theodore Levitt

✌🏼 See you again Thursday …

The answer to today’s STUMP BEZOS is
You can add up to 1,000 to a single ad group


Reach 9,100+ engaged sellers
Advertise in BDSN