Amazon Sponsored Ads will no longer need advanced payments

Rebecca Menezes | Sep 10, 2020

Sponsored ads are a great way to get noticed on an online marketplace. They increase visibility and boost sales making them a very effective means of marketplace promotions. Your products are guaranteed to show up in customer search results, that too in the top results.

Delayed benefits from Amazon Sponsored ads

Amazon is one of the online marketplaces that provides the sponsored ads option. However, the etailer’s payment system was considered a bit troublesome to its users. Originally, Amazon sellers were required to make advanced payments for the acquisition of sponsored ads on the platform.

The earlier’s payment process included sellers requesting Amazon to send a payment link to them via email. This link would allow them to credit Rs.5,000 or Rs.10,000 based on the seller’s request. By the time the payment was made it would take a couple of days to reflect the same on the seller’s Amazon account. This in turn delayed the whole process of advertising.

With other marketplaces like Flipkart and Snapdeal, sellers are allowed top-ups. In this case, the seller’s COD balance and prepaid payments are used to pay for the ad.

Request for a simpler ad payment process

Amazon sellers mentioned the delays and inconveniences they were facing to the marketplace and asked it to simplify the current payment process for advertising.

“Advance payment for advertising on Sponsored Products blocks our money up front. Why don’t you (Amazon) charge us on a usage basis” – Asha, Paathra Bhandar

“Recharging my advertising account again and again is a hassle. Even after recharging it takes 3-4 days for the balance to reflect in the account. This impacts our sales volume negatively” – Ajesh George, Tekkitake

After careful consideration of feedback like the above, Amazon sent out an email to its online sellers informing them that it will be introducing a new payment process.

What benefits will sellers enjoy?

  • No need for advanced payments
  • Ad fees will be deducted directly from sales proceeds in the seller’s account
  • No more waiting 2-3 days for your advertising balance to get updated
  • No more payment failures
  • No more stopped campaigns due to ad balance running out
  • No need for net banking, credit cards or debit cards to make payments

This form of payment has already been launched by Amazon in other countries like the US, UK, Germany and Japan. This mode of ad payment will soon be available to Indian online sellers as well.

What do the online sellers think?

According to online seller association, AIOVA, “It’s a good move and will help sellers effectively. However, we are not sure about the reconciliation of the same yet. So we shall be tracking the reconciliation of this deduction once it goes live.”

The association also states that the this new payment process will put Amazon at par with the Flipkart system. A system that understands the ease of business required by esellers. It is overall a good initiative by the marketplace and the association hopes to see other changes too based on seller requests.

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Rebecca Menezes

Rebecca Menezes

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