EcommerceBytes-NewsFlash, Number 2992 - February 01, 2013     2 of 5

Amazon Increases Shipping Credits but is it Enough?

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Amazon waited 3 days after the USPS had hiked rates significantly for international shipments of low-weight items before announcing a rise in shipping credits for three of its four media categories. It had announced on Saturday that it had raised shipping credits for books effective January 25th.

However, the increase in shipping credits in Music, Videos, and DVDs that took effect on January 30th was not enough to come close to covering the new costs in some cases.

Sellers had been worried about the increasing postage rates for months. The discrepancy in domestic shipping rates versus international meant if sellers raised product prices to account for higher international shipping costs, they would price themselves out of the domestic market. And if they kept product prices the same, they would take a big loss on international orders.

Many sellers had changed their listings last week so their media items could not be purchased by international buyers. Amazon raised shipping credits for Expedited International to $44.95 in all media categories. However, it did not raise shipping credits for Standard International at the same rate the costs increased.

For example, the shipping credit for Standard International for music was $6.89, Amazon raised it to $8.89 as of January 30, 2013. Sellers on Amazon's discussion boards asked, "Why only a $2 increase in shipping when international shipping went up closer to $6?" and, "So they raise it, but not enough to cover actual cost. Does this make sense?"

Some sellers considered listing titles twice, one for domestic and one for international. But one seller wrote, "Double listing CDs, one price for domestic and one for international I doubt would work and would probably be a violation of Amazon policy, and would inevitably lead to a double order at some point. It would seem that listing a CD at $3 would always incur a loss on an international sale."

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About the author:

Ina Steiner is co-founder and Editor of EcommerceBytes and has been reporting on ecommerce since 1999. She's a widely cited authority on marketplace selling and is author of "Turn eBay Data Into Dollars" (McGraw-Hill 2006). Her blog was featured in the book, "Blogging Heroes" (Wiley 2008). Follow her on Twitter at @ecommercebytes and send news tips to ina@ecommercebytes.com.


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