Learn all about the Amazon Brand Referral Program

Amazon Brand Referral Program

On Jul 15, 2021, Amazon announced its new Brand Referral Bonus Program. According to Seller Central, the program is designed to offer sellers an opportunity to earn a bonus of 10% from non-Amazon marketing efforts. But where does the bonus come from? 

To answer that question, we are going to take a deep dive into learning exactly what the Brand Referral Bonus Program is. We will see how it compares to the Amazon Affiliate Program and how you can use either one to ultimately increase your income. 

1. What is Amazon’s Brand Referral Bonus and How Does it Work?

Amazon Brand Referral Program

The Amazon Brand Referral Program offers an earnings bonus to products within existing Amazon brands of an additional 10% on top of your own sales you made on your brand. However, the advertisement from that brand must come from a third-party source. 

Once Amazon can confirm the shopper comes from another location, this bonus applies to the entirety of your brand product lineup. The bonus lasts for 14 days after clicking the off-site advertisement. 

If you read our article on the upcoming A10 Algorithm updates, you likely saw this coming. Amazon is highly focused on incentivizing people who can bring new shoppers to its platform. 

How Does Amazon Benefit From This Bonus Program?

Amazon Brand Referral Program

Statista.com reports that Amazon accounts for half of the total eCommerce market sales, which leaves 50% of the market that Amazon has yet to conquer. Amazon understands there are plenty of opportunities for them to take an even larger portion. 

Amazon is one of the largest companies in the world, giving them strong capabilities to handle logistics on a huge scale. There’s no limit to the scalability of this business, allowing for the creation of many more fulfillment centers. 

This, combined with multi-channel fulfillment, means that you might be getting Amazon shipment without it coming directly being from Amazon. 

2. How Do Amazon Brands Benefit from this Program?

Amazon Brand Referral

Offering an extra 10% bonus for creating off-site advertising gives you the opportunity to earn more money. And, unlike commission rates from theAmazon Affiliate Program, you aren’t promoting someone else’s products. 

Amazon associates who have a solid social media presence or the budget to advertise off the platform can benefit heavily from this. You just need to be sure that the enhanced cost of advertising doesn’t exceed your budget. 

If you are already familiar with Facebook advertising, Google Ads, or other off-Amazon ads, this won’t affect your strategy. Instead, you’ll have a unique link that enables you to earn extra money for something you are already doing. 

New Amazon sellers will need to step outside their comfort zone and incorporate third-party advertising into their strategy. From our previous blogs, you already know that diversifying your advertising strategy is a good thing. This program is just another opportunity to do so. 

3. Everything You Need To Know About The Brand Referral Bonus Program

Who Can Join the Brand Referral Bonus Program?

During this writing, all US-based stores’ active members of the Amazon Brand Registry can join. If you have yet to enroll in the brand registry, check out this article on Amazon Brand Registry on how to go through the process. 

There is currently no information about when this program will become available in other countries. So if you are not in the-United States you unfortunately will not be able to participate. 

Which Sales Qualify for the Bonus Program?

The sales bonus applies to any branded products with an originating attribution tag from a non-Amazon marketing source. It also includes additional products purchased under the same brand for 14 days after clicking the ad. 

What are Attribution Tags?

Amazon Advertising has a beta program called Attribution that you can take advantage of. The program exists to help you optimize your off-site advertising, which relates heavily to this program. Read more about Amazon Attrubution and how to send more organic traffic to your listings.

To sign up for the Attribution Program, you need to be enrolled in the Amazon Brand Registry. Attribution tags enable you to track standard metrics like impressions, clicks, and conversions. 

Because there is no cost associated with attribution, signing up is currently risk-free. companies like Premier Nutrition,for example, have used this service and seen a 300% increase in sales

For more information on creating an attribution tag, you’ll need to sign up to Amazon Advertising. If you have an existing Amazon Seller account, it will automatically link to Amazon Advertising. 

What if You are Already an Amazon Attribution User?

If you already use Amazon attribution tags, you will already have a tracking system in place. As a result, this step of signing up for the program will be taken care of for you.

Amazon will track all brand-based sales from the day you activate the Brand Referral Bonus from your first day of enrollment. 

How Do I Find Out How Much My Bonus Is Going To Be?

There are two methods you can use to find out your bonus.

Your first method is to use the Brand Referral Bonus Report. Every Friday, Amazon’s system will generate a report to inform you of the last 90 days of your bonus amount.  

This estimated amount will include everything from the previous Friday, up until that day. If you have no qualified sales during the past 90 day period, no report will be generated. 

The Other method is to calculate that you will receive 10% of your total sales of your brand. Exclude any sales that do not include related brands. For example, if you made $200 worth of sales on your brand, you might make $20 worth of bonus cash. 

Can You Opt-Out of the Bonus? 

Yes, you can send a message to Partner Support and request to opt-out if you do not wish to be part of the program. 

4. Calculating Your Bonus Rate for the Brand Referral Program

Amazon Brand Referral Program Bonus Calculations

While 10% is the standard percentage of bonus received, your rate will change depending on what you sell. For the highest bonus rate available, you cansell Amazon Device Accessories, which receive a 30% estimated bonus rate

Here are some excerpts from the bonus rate table worth noting: 

Amazon Brand Referral Bonus Rates

The estimated bonus rate might change based on shipping charges. Other product types typically vary from 5% to 15%

5. Will Amazon’s Brand Referral Bonus Divert Online Traffic?

Amazon Brand Referral Bonus

A big concern that people express with this new program comes back to online traffic. While it might be ideal for increasing traffic to your Amazon listings in the short run, it doesn’t build your brand very well. 

Amazon is aware of this, which is why the brand program exists in the first place. Paying for advertising towards Amazon might discourage you from paying for advertising to your site. This process makes you more dependent on Amazon and less able to establish your own eCommerce platform.

Amazon associates, under the comments section, have addressed this concern already. With this in mind, diversifying your advertising portfolio has never been more critical. Yes, you should take advantage of the new Amazon Brand Referral Program. However, don’t direct all of your traffic to Amazon pages. 

Amazon understands the value of brands willing to build a backbone. By becoming less reliant on Amazon, you become more valuable to them. Referral bonuses aside, you want customers to keep coming back. 

6. Why Amazon Has Started The Brand Referral Bonus Program

Other direct competitors are also stepping up their game to compete with Amazon. the world’s most prominent players in commerce, Alibaba and Walmart, have ramped up their eCommerce activities.

Walmart Marketplace, for instance, was recently rebranded to capture a larger audience. Walmart has its version of seller central, which is discussed in another article.. 

Walmart has a significant  advantage over Amazon- and that is their brick-and-mortar stores. They focus marketing efforts on both online marketplaces and physical stores  They also have begun to offer at-home delivery and three-day shipping, which is very competitive with Amazon. 

The other major competitor,Alibaba,is owned by a billionaire named Jack Ma. With the offer of 72-hour global delivery, Jack and co. have been giving Amazon a run for their money. 

Alibaba also has high warehouse efficiency, with 800 robots that can prepare $75 billion worth of packages for shipment. Many of the products on Alibaba are sent to Amazon through private label sales. You can learn more about private label selling in this article.

Amazon Brand Referral Program

To address these shortcomings, Amazon has responded by encouraging more traffic. As eCommerce continues the competition, we’ll see how Amazon responds with its latest updates. 

Other direct competitors are also stepping up their game to compete with Amazon. the world’s most prominent players in commerce, Alibaba and Walmart, have ramped up their eCommerce activities.

Walmart Marketplace, for instance, was recently rebranded to capture a larger audience. Walmart has its version of seller central, which is discussed in another article.. 

Walmart has a significant  advantage over Amazon- and that is their brick-and-mortar stores. They focus marketing efforts on both online marketplaces and physical stores  They also have begun to offer at-home delivery and three-day shipping, which is very competitive with Amazon. 

The other major competitor,Alibaba,is owned by a billionaire named Jack Ma. With the offer of 72-hour global delivery, Jack and co. have been giving Amazon a run for their money. 

Alibaba also has high warehouse efficiency, with 800 robots that can prepare $75 billion worth of packages for shipment. Many of the products on Alibaba are sent to Amazon through private label sales. You can learn more about private label selling in this article.

To address these shortcomings, Amazon has responded by encouraging more traffic. As eCommerce continues the competition, we’ll see how Amazon responds with its latest updates. 

7. Pros and Cons of New Referral Program

Amazon Brand Referral Program

Pro #1: Extra Bonus Earnings 

The cost of sales on Amazon can be pretty high. If you can find a way to earn more money, why not take it? While we will answer that question in a greater capacity later, the difference in how much more money you can make is astounding.

This money can potentially bring sellers from a point of simply breaking even, to a place of growth and enough funds to invest in new products. The ultimate goal of most businesses is to make money. So this is one step that can bring you closer to your overall goal

Should this income be relied upon? No. Instead, it can be a bonus you can use to further your business. Unexpected capital is one of the best kinds of money.

Pro #2: It Encourages You To Experiment With More Advertisement Methods  

A big mistake that most amazon advertisers make is to stick with what works. While this is a great general idea, it stagnates the seller. Sticking with what works can eliminate the need for critical thinking, sticking you with the same process each month could mean little growth

Many times, the process might not work in certain situations. Let’s take a look at a significant Amazon trend for an example: at-home workouts. 

The latest 2021 Amazon Trend Reports shows that sales for fitness equipment shot up by 50%. If this is your first year as a seller and you see fabulous sales, you might use the global pandemic in your advertising. 

This form of advertising will work until the pandemic improves. Ideally, as more people get vaccinated and the medical field can address this more easily, we’ll see fewer sales for products that people use while staying in their homes. 

That means using the pandemic in your at-home workout advertising will be inappropriate within the next few years. 

This example is a reminder that you must rely on many forms of advertising, not just one. Even your current advertisements will become ineffective over time. 

Pro #3: It Encourages You To Become a Brand

Amazon understands that what attracts people is a brand, and it’s story. That’s what gives you an emotional connection to a brand, and helps you remember it.It isn’t just about having a high-quality product; it’s about connection. 

If you doubt that, take a look at the most watched television program in the United States: The Super Bowl. Another example is  the “Alexa Loses Her Voice” commercial- we know Alexa, not a voice-activated product

Compared to some of the more zany commercials, this isn’t the most exciting example. But it shows that the world’s most customer-centric brand understands what it means to connect with people. 

You might argue that this “only applies to TV,” but pay attention to banner advertising, click funnels, and any other form of online ads. In all states, you’ll typically find some examples of people using emotional connections to promote their brands.

One way you can build your brand’s story is by using Amazon Posts. 

Remember, people don’t buy products. Instead, they purchase the ideas behind those products. 

Pro #4: Higher Returns on Ad Spend Potential (ROAS)

While it might be painful to admit, people don’t know your brand yet. As a result, it might be harder for you to make a sale on your website. 

However, the brand Amazon is recognizable everywhere, and those who click the ad will likely already have an account. At the very least, they would have heard of Amazon before, increasing their chance to trust any “buy links.” 

When you sell on your own merit, you don’t typically have the same recognition. People are more likely to spend on Amazon, resulting in a higher potential ROAS. 

This idea brings us to the cons side of the Amazon Brand Referral Program:

Con #1: Bonus Payouts are Incredibly Vague 

Cons of the Amazon Brand Referral Program

The table provided earlier in this article shows a clear picture of what you might expect to earn. However, those rates are still conditional, as is indicated by an asterisk. You can find the details of what an asterisk implies for a given condition by looking at the official Seller Central help page

Everything is carefully worded, meaning you can’t hold Amazon accountable for any special bonuses. This wording implies that the bonus is not a reliable source of income. Amazon could feasibly decide you don’t get the premium based on some missing factor. 

You might also find yourself falling short of the 10% vs. 5% bonus based on shipping charges. Paying for gift wrap might cause your $99.99 consumer electronics to be worth half the reward. 

It’s great to get extra cash, but sometimes you will be left wondering how much your payout will actually be worth. 

Con #2: You Are Paying To Advertise Amazon

The second drawback is really the fact that what you are essentially paying for is advertising for  Amazon.But as with any business, you have to spend to earn, and this is no different.

While Amazon is paying you a bonus on your sold products, your actual profit will also be less because Amazon receives a portion of your earnings. The shipping and handling costs you pay to Amazon as an FBA seller are proof of that. Read more on Amazon FBA alternatives here.

If you are only receiving a portion of the bonus you get for paying for ads to a website you have less control over, it can feel like a bad deal. 

If you plan on taking away from the advertising budget to fund this, be sure of one of two things:

  • The bonus you get is worth it. 
  • You take that advertising budget away from what you spend on sponsored products. 

Con #3: You Could Be Advertising Your Competitor’s Products

Whenever you pay to advertise a product, you cannot of course guarantee a conversion. To expect that would be ridiculous, but advertising to Amazon directs them to your brand page of a specific product. 

If you know anything about Amazon’s product page, a product listing also displays alternative items, which are essentially your competitor’s products.. While you run this risk when paying for sponsored products advertising, you don’t typically run this risk when advertising off the platform. 

The biggest issue that comes from using this ad method is that someone could choose your competitor’s product over yours. This means that if someone has a more engaging description that meets a need, you could be drawing people to your competition through your own paid advertising methods. Learn more about how to track your competitors with the Amazon Market Analysis Solution.

When you advertise off the platform to your website, there’s less chance of this. While you still have to overcome the competition, the competition doesn’t share the page with you. Your conversion rate chance is almost always higher when a prospective customer doesn’t see your competitors. 

8. Amazon Referral Bonus Plan FAQs

Can Members of the Amazon Affiliate Program Benefit from this Program? 

Despite having some fundamental similarities between this and the Amazon Affiliate Program, the two have almost nothing to do with each other. Instead, this tool is solely for active Amazon Brands. 

This means members of the Amazon Affiliate Program cannot take advantage of this bonus program. Instead, the bonus is limited to members of the Amazon Brand Registry.

Can Resellers Benefit From This Program?

No, resellers cannot use this program to gain bonus funds on items not under their brand. If they have their brand alongside resold items, that is different. 

You can earn funds on your brand, but not on other items.

Do You Have To Pay For Advertising To Get The Bonus? 

To answer this question, we will refer to bullet one on the Amazon seller Central Forum Announcement

 "Help accelerate your growth and improve the efficiency of your non-Amazon marketing and advertising campaigns that drive your referral traffic to Amazon."

 The program is designed explicitly for non-Amazon marketing. So you won’t be able to earn the referral bonus if you use the program associated with social media shares. 

Can Brand Owners Also Sign Up for the Amazon Affiliates Program? 

Yes, brand owners can sign up to become an Amazon Affiliate, but it would serve no purpose if they were looking to sell personal items. Affiliates are typically those who own no Amazon products because they advertise other product owners. 

If they had a store on Amazon, it would be more fruitful to sell their products. However, there is some merit in advertising supplementary products.

9. Wrap Up

When it comes to looking at the new Amazon Brand Referral Program, its title is somewhat misleading. While it may not be an actual affiliate marketing program, it’s excellent for getting some bonus cash as an Amazon brand owner. Those extra funds can help new brands to kickstart other projects, and old brands to make extra money. 

All signs point towards Amazon preferring brands that can stand on their own two feet. The same can be said for the A10 Algorithm, which will boost product listings based on their off-site traffic potential. 

For more information on how your brand can grow off-platform, you can reach out to our Amazon Analytics Solutions team.  They can help you understand how increasing organic traffic to your product pages can help you become one of the best brands on Amazon. 

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