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Retail Business Review | Thursday, June 11, 2026
Growing tensions have emerged between Amazon sellers and agencies running marketplace growth marketing programs in response to more aggressive attribution modeling by sellers spending substantial amounts on advertising and account management. While revenue gains can certainly be impressive, thinning margins can make attribution much more contentious.
Several Amazon-focused services firms developed their programs based on growth-related measures during an era of rapid Amazon Marketplace development. However, increased expenses associated with fulfillment, risk of returns and rising advertising costs make it increasingly challenging to justify continued spending on growth-oriented metrics.
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The problem is not limited to increased expenditures on ads alone. In addition to growing doubts surrounding attribution of conversions, many brands wonder how the contributions of organic traffic, social outreach and repeat sales should be accounted for in the face of increased sponsored products activity.
It also must be noted that there is a complex interrelation of variables in the Amazon ecosystem. For instance, a product can enjoy better search results after starting its ad campaign, but other aspects such as inventory availability, reviews and seasonality will also shift at the same time. Such dynamics can create ambiguity for many brands offering products in several different categories.
Therefore, more specific financial reporting requirements are likely to emerge. Monthly dashboards measuring overall impressions or traffic lifts may no longer satisfy buyers' demands, forcing agencies to report on profitability by category, taking into account Amazon storage fees, promotional efforts and cost per customer acquisition. Brands have begun questioning why they should be asked to spend even more when their conversion rates decline.
In turn, some ecommerce services firms may start adjusting their business models in response to such trends. Review periods may be shortened while campaigns become less broad and less comprehensive. Moreover, certain brands may retain certain operations related to marketplace management internally while using outsourcing services in a limited capacity (sponsored product advertisements, creative development).
The above developments reflect a new stage in the evolution of the Amazon marketplace seller landscape. During initial phases of Amazon development, fast-growing brands enjoyed substantial success due to fast scaling of catalogs, making them more visible through paid means. Currently, however, sellers need tighter financial controls given that traffic alone will not guarantee profit when considering shipping fees, refund rates and promotional discounts.
As a result, agencies will have to prepare to answer questions concerning bidding strategies, keywords used and recommended changes to accounts. Service firms whose primary message is centered on rapid marketplace growth may experience difficulty retaining their clients amid volatility and increasing skepticism over financial reporting.
From an operational perspective, increased reporting may require additional personnel since analysts must possess knowledge of Amazon advertising as well as general issues of ecommerce finance. The latter requirement may prove particularly challenging for companies supporting several hundred mid-level sellers.
However, the service category itself is not expected to shrink dramatically, given that the platform remains indispensable for many consumer brands. At the same time, the relationship between sellers and agencies is becoming contingent. Sellers do not appear ready to accept growth narrative without evidence of contribution to margin stability.
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