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The ecommerce giant stated that the program will simplify seller experience through customized and actionable recommendations.
In a bid to empower and accelerate the growth of 700,000 sellers, Amazon India on Monday, November 17, announced the launch of STEP, a performance-based benefits program.
The ecommerce giant stated that the program will simplify seller experience through customized and actionable recommendations, which will help the sellers to improve their key customer experience metrics and in turn, their growth. These metrics include cancellation rate, late dispatch rate, return rate, and more.
By improving their performance, the sellers can unlock benefits across various levels such as Basic’, ‘Standard’, ‘Advanced’, and ‘Premium,’ among others. Through STEP, Amazon.in says it will offer its sellers benefits such as fee waivers, faster disbursement cycles, priority seller support, and world-class free account management.
“STEP puts sellers in charge of their success on Amazon.in by helping them track their performance, benefits and growth in real-time through the STEP Dashboard on Seller Central,” the company wrote in a blog post.
From December 1, 2020 to March 31, 2021, all sellers on Amazon.in will get ‘Standard’ benefits. Depending on their performance from January 1 to March 31, 2021, they will be eligible for ‘Basic,’ ‘Advanced,’ and ‘Premium,’ followed by other benefits from April 1, 2021. Every quarter, the sellers will get an opportunity to improve their ranking and receive more benefits based on their performance.
“STEP empowers sellers of all sizes and tenure to drive their growth on Amazon.in by focusing on their performance on key metrics which matter to customers. STEP provides objective and transparent criteria along with benefits designed to help sellers improve their performance on these metrics in a predictable manner,” said Manish Tiwary, Vice President at Amazon India.
With STEP’s launch, Amazon is introducing its revised fee structure, which is linked to STEP levels and includes a waiver on weight handling fees and lightning deal fees as part of the STEP benefits. Effective December 1, 2020, the revised fees will also include a reduction in closing fee charges for products in the low price range (INR 250-500) and zero disposal fees for items shipped from Amazon fulfillment centers.
Tiwary added that at Amazon, they believe that focusing on long-term customer experience is important. “We have spent time obsessing over every detail of the STEP program and carefully crafting each element to ensure our valuable sellers can provide a great customer experience and in turn, grow and be successful on Amazon.in,” he said.
This year, Amazon.in has taken several initiatives to help its sellers, including free COVID-19 health insurance, relaxation in performance metrics, on-demand payment disbursement, fee waivers on inventory storage fees, and 50% waivers on ‘Sell on Amazon’ fees for small sellers.
European Commission antitrust charges against Amazon
The new benefits program comes amid the European Commission’s charges against Amazon for breaching EU antitrust rules by using independent sellers’ non-public data for its own benefit. In a statement last week, the European Commission also announced a second formal investigation into Amazon’s ecommerce processes.
The commission, the executive arm of the European Union, said that Amazon has been using data such as order numbers, revenues ,and number of visitors, to benefit its own retail business which directly competes with third-party sellers.
“Data on the activity of third party sellers should not be used to the benefit of Amazon when it acts as a competitor to these sellers,” Margrethe Vestager, the EU’s competition chief, said in the statement.
“The conditions of competition on the Amazon platform must also be fair. Its rules should not artificially favour Amazon’s own retail offers or advantage the offers of retailers using Amazon’s logistics and delivery services,” Vestager added.
In July 2019, the commission had launched a formal investigation to probe Amazon’s dual role as marketplace and retailer.
However, in a statement, the ecommerce giant said it disagrees “with the preliminary assertions of the European Commission and will continue to make every effort to ensure it has an accurate understanding of the facts.”
It added, “No company cares more about small businesses or has done more to support them over the past two decades than Amazon.”
Future Group-Reliance Retail vs Amazon
Meanwhile, the Delhi High Court is currently hearing a plea from Future Retail Ltd (FRL) seeking to restrain Amazon from approaching regulatory bodies such as the Competition Commission of India (CCI) regarding FRL’s deal with Reliance Retail Ventures Limited (RRVL), a subsidiary of Reliance Industries Limited (RIL). The hearing, which began last week, had resumed on Thursday, November 19 after a short break.
The dispute arose following Future’s proposed sale of its retail, wholesale and warehousing assets to RIL for around INR 25,000 crore (US$3.38 billion) in August this year. However, Amazon, which owns an indirect stake in Future Group, due to its stake in Future Coupon, approached the Singapore International Arbitration Centre (SIAC) in October to contest that Future Retail breached its 2019 investment agreement.
Last year, Amazon had acquired 49% stake in Future Retail’s promotor arm Future Coupon, which holds a 9.8% stake in Future Retail. As per the 2019 investment agreement, Amazon argues that Future shjould be prevented from selling its assets to certain parties, including RIL. Following Amazon’s plea to suspend the sale, the SIAC passed an interim order in favor of the company on October 25.
During the hearing, on behalf of Future Retail, former solicitor general and senior advocate Harish Salve argued that according to the Companies Act 2013, entities holding less than 10% cannot object to the sale.
“When you have passive investment of less than 10%, you cannot make it an active investment,” Salve stated.
In the ecommerce sector, with its launch of JioMart, Reliance Retail is considered a direct competition to Amazon. As the hearings proceed, it remains to be seen who will win the legal battle.