[ BDSN ] 🚨 Amazon Profits Down? Here’s your fix-it flowchart

🔎  HOW 2024 RE-SHAPED CHINESE E-COMMERCE

Brands Factory recently highlighted how 2024 brought major shifts in global e-commerce, most notably Amazon’s fierce rivalry with Temu and the rise of semi-managed logistics.

Combined with stricter international regulations and changing consumer preferences, these factors are shaping new opportunities—and new risks—for Amazon sellers.

Intensifying Competition

Amazon vs. Temu

• Temu has now surpassed Amazon’s global user base.

• By October, Temu became the second most-visited e-commerce site worldwide.

• Over 60% of top Chinese Amazon sellers have begun transitioning to Temu.

Amazon’s Countermove

• Launched Haul, a low-price marketplace for sub-$20 items, to compete directly with Temu.

• Price and speed are now crucial differentiators. Amazon’s traditional advantages in logistics are being challenged by Temu’s cost-focused model.

Evolving Logistics Models

Semi-Managed Logistics

• Temu, Shein, AliExpress, and TikTok Shop integrate sellers’ shipping systems to shorten delivery times to one week or less.

• Larger and more diverse product categories (like food, books, and home goods) are now feasible for cross-border shipping.

Why It Matters

• Fast, flexible shipping attracts customers wary of the traditional two-week wait times common in cross-border e-commerce.

• This model is expanding beyond cross-border platforms, as domestic giants like Taobao and Ele .me roll out similar services.

Heightened Global Regulations

Stricter Trade Policies

• The U.S. is considering lowering its $800 duty-free threshold and tightening T86 clearance rules.

• Other countries (Brazil, Malaysia, South Africa) have introduced new VAT requirements, raising costs for Chinese exporters.

• Proposed tariffs (up to 60% on some goods) could further complicate cross-border trade.

• Chinese companies are setting up overseas factories and R&D centers to comply with local regulations and reduce tariff impact.

Shifting Away from “Stocking Mode”

Once popular for rapidly listing low-cost items across many categories, “stocking mode” is no longer enough to sustain growth.

What’s Changing

• Platforms now enforce stricter rules, demanding quality over sheer quantity.

• Brand building and content-driven marketing are increasingly important. Short videos, live streams, and social media engagement drive consumer trust and loyalty.

What Amazon Sellers Should Do

1. Focus on Competitive Pricing & Shipping

   • Stay vigilant about costs and delivery speed to match the budget-friendly platforms.

2. Strengthen Brand Identity

   • Move from a mass-listing approach to creating a recognizable, content-driven brand presence.

3. Adapt to Regulations

   • Monitor policy changes (duty thresholds, VAT updates, tariffs) and adjust product sourcing or warehousing as needed.

4. Expand Your Channels

   • Reduce reliance on Amazon by exploring other e-commerce marketplaces and offline opportunities.

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🧨 POWERFUL AMC MARKETING CLOUD MADE EASY

Mansour Norouzi, a BDSS XI Iceland speaker and Dream 100 member, created a free tool called AMC Navigator GPT to simplify learning Amazon Marketing Cloud (AMC). His goal is to make learning and using AMC more accessible for everyone.

After reading through all the official AMC documentation and compiling key resources into Google Docs, he used that material to build a comprehensive library.

The tool covers official documentation, certification materials, API references, integration guides, instructional queries, use cases, event-level datasets, as well as AMC playbooks and advanced tools.

🧠  ONE WEEKEND WILL TRANSFORM YOUR AMAZON BIZ

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🚀  TIKTOK’s UNCERTAINITY FUELS FLIP’s METEORIC RISE

With TikTok facing a potential U.S. ban, alternative platforms like Flip have experienced an explosive influx of users and brands.

On Jan. 19, when TikTok’s fate hung in the balance, Flip’s daily new user signups surged to 250,000, and its app crashed under the strain. As a result, Flip shot to the top of Apple’s App Store, with users now spending an average of 35 minutes per day on the platform—more than triple the previous engagement.

Flip isn’t just attracting users—it’s seeing a massive surge in brand applications. Previously onboarding 150 brands per month, Flip received 700 applications in December alone.

Unlike TikTok’s influencer-driven model, Flip differentiates itself by turning everyday shoppers into creators, rewarding them with cash for engagement and conversions. The platform has grown to host 5,000 brands, including Olaplex, Samsung, and Edikted.

The Race to Keep TikTok Refugees Engaged

It’s not just Flip benefiting from TikTok’s uncertainty. Other platforms are seeing record-breaking growth:

• Whatnot had its three largest seller application days ever.

• LTK saw a 78% increase in app downloads.

• Substack hit record user engagement, with 4 million+ paid subscribers.

• Linktree reported a 1,170x surge in links to the Chinese shopping app RedNote.

Big Incentives to Lock in Creators

To retain this surge, platforms are rolling out huge creator funds:

• Meta is offering up to $5,000 in bonuses for posting Reels.

• Substack launched a $20M fund to attract newsletter creators.

• Flip debuted a $100M creator equity fund, offering grants between $6,000 and $100,000. Within 24 hours, 7,000 creators applied.

What’s Next for E-Commerce?

While Flip and others are seeing explosive growth, it remains to be seen if they can maintain momentum. TikTok’s U.S. business is valued at $50B, compared to Flip’s $1.05B and Whatnot’s $5B. For brands, this period presents a unique opportunity to test alternative platforms before the dust settles.

E-commerce sellers should:

✅ Evaluate new platforms like Flip, RedNote, and LTK for audience potential.
✅ Leverage creator funds to maximize exposure.
✅ Monitor shifting user behavior to stay ahead of trends.

The TikTok ban uncertainty is far from over, but one thing is clear: e-commerce brands that act fast can capitalize on this major platform shift.

⚓  CHINA OCEAN RATES DIP - MAY CLIMB AFTER HOLIDAY

Yesterday was Chinese New Year, and ocean freight rates from Asia to North America have dipped following the typical post-Lunar New Year slowdown. Spot rates from Asia to the U.S. West Coast dropped 7% to $4,938 per FEU, while East Coast rates fell 1% to $6,656 per FEU.

These declines follow a surge in early January as shippers rushed to move goods before factory shutdowns in China. However, rates may climb again depending on the backlog built over the holiday period.

Beyond seasonal fluctuations, ongoing geopolitical and economic factors continue to impact supply chains. The Red Sea crisis is keeping freight rates elevated compared to pre-pandemic levels, as carriers like Maersk and CMA CGM continue to reroute around Africa instead of using the Suez Canal.

Additionally, tariff uncertainty is creating more disruption. President Trump has proposed an additional 10-60% tariff on Chinese imports as early as Feb. 1, leading many businesses to frontload shipments to avoid potential cost increases. While details on the tariffs remain unclear, companies are already diversifying supply chains and adjusting strategies to mitigate risks.

🐦‍🔥 THRASIO CRASHED HIS BRAND - HE BOUGHT IT BACK

Last year Ben Leonard, the author of Quit Stalling: Build Your Brand, called out Thrasio, saying they should sell his brand, Beast Gear, back to him so he could rebuild it in public.

Well … he got it back.

Right now, it’s a total mess—an absolute shambles. But that’s about to change.

Ben is documenting the entire turnaround in radical detail.

Want to follow along?

If you’re an e-commerce expert—whether it’s product dev, Amazon PPC, Meta ads, video, logistics, or chatbots—he wants to hear from YOU. He’s bringing in the best to show exactly how this comeback happens in this turnaround.

✌🏼 Have a great weekend.

See you again Monday.

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