Negative Side Effects of Deep Discount Launches [SCUM-SUCKING Hijackers]

Launching products on Amazon is a topic that will get debated over and over again. Fundamentally, there’s an algorithm, and that algorithm reacts to signals. People buying your product, even at a discount, is a signal. And hey, it’s not like “promotional launch offers” are a new concept to the retail industry as a whole! It’s practically standard operating procedure!

But, cut the debate for a second. The reason why so much debate goes on is primarily because people are in search of “The perfect solution” which basically costs no money or effort and gives you the best results. Yeah…. that sounds realistic. So instead, we focus on all the negatives, search for proof, debate back and forth about the ONE rationalisation that proves your own world view. This is 100% natural human behaviour.

I am a fan of discount launches (get that out of the way), however, I am not blind to the negative side effects that we’ve felt as a result of pursuing that strategy and that’s what this post is about.

The Hijacking Risk of Discounted Amazon Product Launches

Call them scum. Call them bottom-feeders. Call them upstarts. Call them “the little guy”. Call them what you will, they represent a risk to your business, your already strained relationship with the customer and, fundamentally, your sales figures.

I am of course referring to 3rd party sellers who decide they’re going to have a stab at selling your branded product on your listing. Mother F@#kers!

Now many Brand Registered sellers will be thinking I’m talking here about counterfeiters. That’s a whole other story. There’s nothing to call those types of sellers other than complete dicks. Full Stop. End of Story.

However, particular risk I’m highlighting is that of selling “REAL” product at a 70%, 80%, 90% discount during launch, then the buyer purchasing as many as they can and then selling them on your listing. Basically, it’s a form of “Retail Arbitrage” otherwise termed “Online Arbitrage”.

This is a method by which many sellers “start their journey” and the more systematic that discounted product launches on Amazon through launch platforms such as Viral Launch and Jump Send have become, the more systematic these guys have become.

Think about it…

Amazon Private Label Arbitrage Money Making “Opportunity”

If you’re wanting to get into the “Private Label” game on Amazon but don’t have the cash, loads of people are out there touting arbitrage as the way to get familiar with the platform and make a bit of cash.

So the herd moves.

Extend the advice a little.

“If you head on over to deal sites like Jump Send and Viral Launch you’ll be able to find products that, if you purchase and then resell on the Amazon listing, you’ll be able to make a few bucks.

Multiply those few bucks by a few hundred sales and BOSH you’ve got yourself $1,000!!!

I could almost write the freaking manual for the course in a 500 word blog article – it’s INSANE.

But there’s a lesson to be learned…

“Widespread Systemisation Creates Business Opportunities for Those Who Want to Take Advantage of The System”

The more systematic, systemised and widespread an approach or methodology becomes, the more likely it is that someone will build a system or methodology that takes advantage of the first system.

So, you either;

  • Steer away from making anything systemised and hope that the randomness of ducking a diving, or the “Kansas city shuffle” will keep the upstarts at bay. Or;
  • You avoid the other side of the coin. The “Widespread” side. Build your own, proprietary systems that are small enough and not widespread enough to be a legitimately sized business opportunity to justify inventing another system to game the first system.

Getting These Scrappy Advantage Seekers Off Your Listings

If these guys actually have your product, what is there you can actually do? There is a possibility of claiming exclusive distribution rights. In the US however you might get the “First-Sale Doctrine” quoted at you. If so, you know the seller is a professional arsehole / someone who systematically preys on sellers offering deep discounts to launch products.

Amazon however does NOT want counterfeit product flowing through their system. As a result, there’s a natural dilemma they face, and will continue to face that involves upholding one law against upholding another.

Which is most important to Amazon?

  1. Upholding counterfeit law and not destroying their reputation as a place to purchase legitimate merchandise, or;
  2. Upholding the rights of a seller who probably isn’t doing a great deal of revenue, or product volume, probably sells 2-3 of an item at a time (maybe 20-30 if they’re lucky) and constantly gets heat from other sellers complaining of violations?

The truth is, these bottom-feeders are probably problem child accounts for Amazon, prone to all sorts of issues and problems. There will be a few that succeed and systemise, but equally so many of them will starve and die (not literally hopefully).

Therefore, as long as what’s good for Amazon remains aligned with what’s good for us I’m not yelling “the end is nigh!”

So it’s the standard advice. Contact the seller, tell them they don’t have distribution rights, report a violation with Brand Registry, Purchase the product off the listing and rise above it.

For a template to contact the hijacker seller, take a look here.

Conclusion: There Are Always Risks and Pro’s and Con’s

Just get on with it. Accept that these sorts of things are signs that there’s a need for new systems and for the mature and old one’s to die off and plateau.

The strategy however may remain the same. Product launches make sense. Using the systems that have now been “gamed” and had “advantage taking” systems built upon them is probably not a sustainable solution for avoiding these common irritations and negatives.