Report: ‘Amazon’s Choice’ Label Offered in Exchange for Higher Ad Spending, Lower Prices

For years, Amazon has offered a label on certain products denoting that they were “Amazon’s Choice.” For years, it’s been unclear exactly which products are chosen for this heady designation or what sales targets, user ratings, or other qualifications they must achieve to be so labeled. Amazon describes Amazon’s Choice products as “highly rated, well-priced products available to ship immediately,” but it’s been known to appear on products that aren’t even shipping yet, and therefore definitionally cannot have been rated by anyone affiliated with or buying from Amazon. It’s also appeared on poorly rated junk items.

Now, a new report from Digiday suggests Amazon used to have a remarkably straightforward process for deciding which products will be labeled “Amazon’s Choice.” Companies were invited to bid on the badge by lowering their prices and spending more money on advertising with Amazon. A pitch deck reviewed by that publication lays out the criteria: To qualify to bid, Amazon first-party vendors — resellers could not apply — had to maintain brand ratings above four stars, keep products in stock for 12 months, and maintain various technical subcategory ratings. Digiday writes:

In an email to a brand client, an Amazon strategic vendor service manager recommended the brand drop its selling price by $30 in order to win the bid, a move that would increase Amazon’s profits on the sale. For vendors, access to a strategic vendor service manager, considered to provide inside access to Amazon, costs hundreds of thousands of dollars per year…

As Amazon has done in the past to lure attractive brands on its platform, it offered other incentives to potential bidders. In the deck, it pitched additional marketing value including free A+ analytics and discounted premium A+ analytics, Amazon Vine credits (which give brands access to free product reviews from customers), email promotions and higher inventory purchases for 12 weeks.

In exchange, Amazon wanted the brands to commit to putting resources into their product listings in order to win the badge. The deck said that customer return rate and damage rate percentages, past sell-through, expert reviews, margin growth, additional marketing investments across Amazon’s ad products, content creation and strong promotions would be considered for each bid. In terms of marketing investments, Amazon asked bidders to list investments that they planned to make to support the product, as well as marketing that already was running.

Image by Buzzfeed

According to Amazon, this program ran briefly in 2017 and has since been rolled back, but problems with the Amazon’s Choice program persist. I’ve had poor results when using it — the HDMI cables I purchased recently that were “Amazon’s Choice” have problems with green snow appearing in 3D games, despite the fact that these cables are supposedly HDMI 2.0b-certified. I bought two and both are defective. Some of the iPhone cables I’ve purchased that were certified under the same program have been garbage and failed within a matter of months; others have worked perfectly for years. I will be the first person to say that the plural of “anecdote” is not “data,” but my experience agrees with a Buzzfeed investigation this past June. Amazon’s Choice labels have appeared on products the manufacturer labeled as inaccurate, like a baby thermometer. Buzzfeed’s investigation found “Amazon’s Choice” lockpicks that can be picked in a matter of seconds. The “Amazon’s Choice” AmazonBasics Security Safe can be picked in three seconds. A flask purchased on the website turned whiskey black and other customers complained of a horrid, metallic taste.

The issue has recently escalated to the US Senate. US Senator Bob Menendez (D-NJ) has sent a letter to Jeff Bezos demanding additional information on how products are chosen to be labeled as “Amazon’s Choice.” The letter notes that consumers commonly identify the label as indicating that Amazon has selected a product, specifically, as a recommended choice. The badge is also worth a good deal of money; a study by OC&C Strategy Consultants found that products labeled “Amazon’s Choice” experienced a threefold sales increase, while products de-listed as “Amazon’s Choice” suffered a 30 percent sales drop.

The letter requests a detailed explanation of how the decision is made to apply the label, as well as information on whether an algorithm is involved and, if so, whether or not the algorithm’s decisions are reviewed by a human. The letter also requests information on what Amazon considers “highly rated,” the steps it takes to remove fraudulent listings, whether companies are allowed to bid to receive the Amazon’s Choice label, and how it deals with the practice of review recycling (the practice of applying old reviews to new product revisions without disclosing it).

My own advice is to treat the “Amazon’s Choice” label with skepticism and to do your own homework before buying the product. I’ve had enough bad luck with it that I don’t trust it anymore.

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