Amazon News: Temu’s Takeover, AI Price Checks & Global Expansion Risks

Amazon News: Temu’s Takeover, AI Price Checks & Global Expansion Risks Unknown Speaker: Welcome, fellow entrepreneurs, to the Amazon Sellers School podcast, where we talk about Amazon and how you can use it to build an e-commerce empire, a side hustle, and anything in between. And now your host, Todd Welch. Hello, hello, hello. Speaker 3: Welcome to another episode of Amazon Seller News Live. Got Ritu and Noah with me today. Appreciate you guys joining me. Ritu, of course, over at PPC Ninja and Noah over at my Amazon guy. So Gonna be a good show. We've got some really cool news. Some news about Temu and some Rufus news as well. Surprising move up of a marketplace into second place by revenue, which is cool. And then we're gonna talk about some tariffs and closing of some loopholes and such as well. If you're out there watching the show and you have any questions, comments, concerns, throw them in the comments. I'll see them over here on the side and we can bring them up in the show. So without a further ado, let's go ahead and dive into the first news article here. Temu overtakes Amazon in global monthly active users. Temu has surpassed Amazon in global monthly active users, signaling a major shift in e-commerce competition, while Amazon still holds key advantages in product quality and fast fulfillment. Temu is rapidly expanding its local inventory model, which could lead to higher average selling prices and quicker deliveries. For Amazon sellers, this means increased competition as Temu continues to attract budget conscious shoppers. And potentially pulls spending away from traditional online and offline retailers. As Temu reduces buyer incentives and raises prices, sellers should monitor how shifting consumer behavior impacts demand on Amazon's marketplace. So what do you guys think? Are we all going to be selling on Temu very shortly and Amazon will go into the dustbin of history? No. Speaker 1: No. Speaker 3: I think it's kind of interesting. Speaker 2: Yeah, I think it's kind of interesting. So I mean, Amazon released haul last year, right? So we saw that immediately of that was probably preempting this type thing where Amazon does see things like, you know, Sheen, Temu is, you know, enough of competitors for them to release haul and try and get people to shop on haul. But Realistically, I mean, especially with all the tariff stuff going on, the, you know, Dave Minimus being taken away, all of that, I think is going to really hurt Temu overall, and it's not going to continue growing. I mean, also, The amount of lawsuits that Temu has against it just right now for, you know, being just full of viruses and not actually sending actual products, things like that. I just don't see it being something that continues to grow, I guess is the best way to put it. Speaker 3: Unfortunately, the article does not break out where the users are. I've got to assume that a large amount of them are in China and Amazon's going to have a very small amount, if anything, there. A large amount of it might be there. It'd be nice to see a breakout of it. Speaker 2: That's the big thing. It's one of the largest in China right now. There's essentially that one. There's Alibaba, which is huge in China, Rakuten. Those are all the big ones over in China. Amazon just isn't. The likelihood of this being like a, you know, the U.S. stat is super low. Once we actually kind of see more of that, I would be curious, because I think it's something like the article you had linked, Todd, was 30% of all orders are through that, you know, de memas loophole, right? Which that means immediately the U.S. part of Temu is just cut off pretty much. Speaker 3: Yep. Yeah. Their prices, of course, are going to be going up. But what are your thoughts, Ritu? Speaker 1: Yeah, so, you know, I do agree that it's not going to be a big blow for Amazon, but there's something to be said about the trend that's running behind this whole, you know, shift in the dynamics that, you know, Amazon is, you know, the largest and it tends to be the place that, you know, draws people who want good quality products. But even the quality on Amazon is kind of deteriorating with a lot of knockoffs and just competitors that look just like your product. And most companies have just between three to six months of like a lead time before their product gets copied. I have one of our furniture brands that we manage there. You know, they have Chinese competitors that mimic their products like instantly, like within two to three months, they have the same exact product for like a fraction of the cost. So while, you know, it's true that, you know, Temu might have, you know, its challenges with With the de minimis going away and all of that stuff. But, you know, the trend is towards like, we want cheap, we want cheap. It's like, it's just something like a writing on the wall that all of us need to pay attention to. And that's the reason why Haul was created in the first place, because there is a market for those sorts of products, even though they're poor quality, even though they, you know, they're not safe or whatever. People will still buy that kind of junk. So, yeah. Speaker 3: There's always going to be that market for the cheapest product, but forever in business. If you read business books and stuff like that, they always say, never try to be the cheapest. Because there's always going to be somebody who's going to be cheaper, whether somebody will ever be cheaper than China. I don't know. I guess I've heard of the Chinese people protesting for outsourcing to like Vietnam and other places. So I guess there always will be somebody cheaper. So I looked up, you know, and assuming Grok is correct here, it is saying that Amazon has approximately 230 million active users in the USA and Temu has approximately 185.6 million. So not that far off if those numbers are correct. Speaker 2: Yeah, which I mean, that's fairly comparable at the end of the day. I would imagine there's some variation there. But again, it seems Odd to me to, you know, obviously we're in a global economy and, you know, marketplace scale at this point, but even still seems odd to compare like Temu, which right now is only in what, like three, four different countries to Amazon, which is in, I think, 23 different countries, right, marketplaces. Speaker 3: Yeah, it's definitely not a fair comparison as well. You know, I'm, I'm going to assume for sure that the the average track, the average order amount is going to be significantly lower on on Temu. And the frequency of ordering is probably significantly lower as well. Speaker 2: I mean, also just thinking about the fact that it's a Chinese app, I mean, we're talking also just from like a monthly users perspective, right? I mean, I'm pretty positive that you can combine all of the marketplaces that Amazon is currently operating in, you know, except for maybe India, right? And add together all of the population. I think China still just has a larger population than all of those, right? So it's like, you know, it's a bit of an unfair comparison in that regard as well. Speaker 3: Yeah. And one of the things that really stands out to me on Temu is this line right here that Prices on Temu are set by the platform based on sellers ask price rather than by the sellers themselves. So they keep really strict control over the pricing. And in fact, we had a news article not too long ago about how suppliers were stopping sending product into Temu and were trying to pull them out because they were selling their products at a loss. Temu wasn't even paying them anything because they were selling them at such a low price. Speaker 2: Yeah, I met with them at one point in time months and months back because I was looking as a feasible place for agency work, right? But the reason you don't see Temu, Temu agencies anywhere is actually because of how their internal system works. So when you sign up as a seller, you actually get designated like representatives and people who are going to manage your listings for you and create your listings for you, manage your advertising for you on the marketplace. So it's interesting because it's like They get to essentially decide what happens once you're on the marketplace and you don't get to do anything as a seller. There's no agency work that can be done there because there's no real partnership. It's kind of just like a worse version of like Amazon 1P. Speaker 3: Yeah, yeah, kind of a good, you know, democracy versus communism, little comparison there, maybe, you know, Chinese, China is used to controlling everything where the US is more, you know, we try to let people do, do what they want for the most part. So it could be a little bit of that in there. But I would it would definitely stop me from wanting to sell on there unless there was some huge, compelling reason to do it. I mean, if I can't control how much my products get sold at and how much I'm going to make. I mean, you can't run a business like that very well. Speaker 1: Yeah, I think that, you know, the Temu game is mostly for Factory brands and people who can actually procure those products really cheap because I don't think this is a viable business model for anyone in the West because our overheads, our costs are not going to make us, you know, the kind of revenue we need. So I don't think playing the low ASP game is a viable option for most Western sellers. It is something that, you know, someone in China would be You know, more interested in. So I don't think that way, you know, that it's anything that sellers need to. And to your point, Noah, that there are no agencies, you know, selling or selling services on Temu because there's very few people that would be interested. Maybe they supplement their sales and use it as a funnel of some sort, but it's not like a destination for selling if it's a serious seller on the West side. Speaker 3: Yeah, for sure. This last sentence here kind of got me thinking, maybe scratching my head a little bit, because it's claiming that, you know, where is the Increased spend on Temu going to come from and it's saying that it's going to be more diverting from offline spend to Temu, which kind of made me scratch my head a little bit. Definitely more of an opinion, but I feel like, you know, a lot of the offline spend is, you know, already gone online. You know, it's going to be incremental from here after COVID and such. So what are you guys' thoughts on that? Kind of last line there, the opinion he has. Speaker 2: Oh, may I go first? Speaker 3: Go for it Noah. Speaker 2: I think that there are risks associated with getting onto a marketplace like Temu. I think there's risks associated with Amazon. There's risks associated with business, right? That's never going to go away. I think the bigger thing is the risk of Whether or not getting onto a certain marketplace such as Temu is really going to be worth it in the end, which I don't see it as being worth it, at least right now. I think it's still too new. We're probably looking from like an actual dollar percentage amount like Temu versus Amazon. It's just not going to be a comparable amount in the slightest. I mean, Amazon still owns roughly 40% of all e-commerce sales in the United States at the very least. And so it's It's not gonna happen anytime soon. It's kind of my thought. Speaker 3: Yeah. I always like competition and maybe Temu will be competition at some point. I mean, they are, but it would be nice to see them open up their platform and be more like an Amazon platform and add to the competition just so sellers did have more choices. Regardless that they're based in China, You know, competition is still good and it helps hold Amazon accountable for what they're doing. And if Temu can have, you know, open up, and have lower fees than Amazon, then that puts pressure on Amazon to lower their fees. All right, let's go ahead and move on to our next article here. This one is right in your ballpark, Ritu, as the AI person on the show. You talk about AI quite a bit in different summits and such. So, the days of price gouging are over, says Andrew Bell. Customers now have proof with Rufus. Amazon's Rufus AI Assistant now provides shoppers with 90 days of price history, giving them visibility into past pricing and real discounts. This means customers can easily detect price gouging, making transparency more critical than ever for sellers. For Amazon sellers, adapting to this change means focusing on competitive, trust-driven price strategies to maintain sales and customer loyalty. Those who embrace honest pricing will be in the best position to thrive in this new era of e-commerce transparency. We can dive into this and talk about this pricing graph, but I'd also like to hear your guys' thoughts on the overall effect that Rufus has and the AI in general on the Amazon platform. So Ritu, go ahead, I'll let you dive into it here. Speaker 1: Yeah, so my thoughts on Rufus are that, you know, right now Rufus is like this little button that's kind of tucked away, you know, on the menu bar. And sometimes you see glimpses of it, you know, sprinkled in to the product detail page. And its presence isn't known widely or felt yet by shoppers. Like they know that it's kind of like suggestions are made from time to time. But if you ask someone, A shopper like, do you know about Rufus? They probably don't know. And in fact, I was having this conversation just yesterday with someone. This person says, what is Rufus? I shop a lot on Amazon. I've never seen Rufus. What is it? I showed it to him. I said, click on this button and then this thing comes up. We who are in the Amazon seller community, we're more focused on Rufus and the Q&A and we're trying to extract prompts. We've actually built tools to extract those prompts and then do stuff with it, etc. But most shoppers don't know anything about it. But that doesn't mean that it's not scary. It is because all it would take is for Amazon to make this interface more mainstream. If the search results or the search bar was to be tweaked or re-engineered in any way that just makes it like have a conversation with your AI assistant right here and that becomes the norm, then overnight it would affect everything because Rufus gets to be the gatekeeper. That's how I'm looking at Rufus right now. Rufus gets to be the gatekeeper of what's shown, what's not shown. Even this price history, what I've been noticing in all the scraping that we're doing is that it does show up sometimes, but in some cases it doesn't. So it's up to Rufus. If it runs out of things to say, then it starts showing price history and stuff like that. I mean, it could become more like prominent, but at the moment it sits at the bottom of at least 10 questions. It's not the very first thing that's shown. It's probably that Andrew has been clicking on this for a while. So, and I do think that Rufus has Deep product knowledge. And it knows everything about not only how you describe your product and how your images describe the product, but also everything that people say about your product, not only on the Amazon platform, but outside as well. So it's picking up signals from everywhere and it knows everything. So there is no hiding. That's basically the point of Andrew's You know, post here that there is no hiding. You've got to be more genuine. This is what's going to force that genuine, you know, how you show up on Amazon. So anything we do from here on kind of needs to keep that in mind because, you know, Santa Claus is watching, Rufus is watching and, you know, taking note of everything, including the price changes over time and, you know, may come back and bite you in the butt if you're not careful. Speaker 3: Yeah, it's the history price graph. I mean, honestly, Amazon should probably just put that on every listing. I try to shop on my desktop as much as possible just so that I can look at the Keepa graph and see, you know, make sure I'm not paying a super high price at the moment or should I wait a little while and see if the price goes down, if it has lots of fluctuations, you know. So I've done that with the Keepa graph for a long time. It's nice that they're showing this, but yeah, you're definitely right, Ritu. Very few people are probably using it at the moment. As he shows there, you very have to specifically say show price history. And, you know, if you remember the days of DOS and using a computer on DOS, not very many people use DOS because nobody wanted to remember commands. So what do you think, Noah? Speaker 2: I got to agree with Ritu, especially in the idea of people Not knowing that it exists. It's so interesting because things like this that come out for platforms like Amazon, I think all three of us being within the Amazon ecosystem, it's what we eat, breathe, live every single day. We see these, right? We see Rufus. We see these changes. We try and take note of how they're going to affect sellers while simultaneously how they're going to affect the industry. You know, Andrew's post is great about the idea of like showing different pricing discrepancies, things like that. The reality of it is, though, if you probably run a poll of any kind, actually, I might just run one while we're doing this. But if you run a poll of any kind, I bet the large majority of people within, you know, who aren't in the Amazon space, who are just consumers, probably don't even know Rufus exists. And if they do know they exist, they don't know Let's talk about the extent of using it in this capacity, right? You show somebody, you know, somebody just asking a question. It's so easy. Show price history, for instance, is not a question that the average consumer is going to be using Rufus for. It's just, it's not. I think this is super interesting and like a tool that can be utilized outside of something like Keepa, right? I don't know why you would because this is a free version, you know, a free thing that you can get from Keepa. But either way, I think that's interesting from a seller perspective. But I think from a buyer perspective, how many people know that Rufus exists? How many of them use it actively to shop right now? We're still very much in the beginning stages of I'm an AI in general, and I think Rufus is, for all intents and purposes, it's pretty much a chatbot, realistically, right? That's kind of just built into Amazon's system. It has some Amazon custom functionality, but it really just, for average consumer, I think, isn't going to be all that much of a difference. Speaker 3: Hey Amazon sellers, tired of losing money on storage and shipping fees? Well, Amazon Storage Pros is here to take the headache out of logistics. We manage everything from inventory and creating efficient shipping plans to working with 3PLs and Amazon's AWD so that you can focus on growing your business. Start with a free storage cost audit and discover exactly where you're overspending and how to fix it. Don't let logistics eat into your profits. Visit AmazonStoragePros.com. That's AmazonStoragePros.com to get your free storage cost audit and start saving today. And now back to the show. Speaker 2: Made for more tech savvy ones. Speaker 3: I agree. I agree right now. It's not something that most people are going to be using. Five years from now, 10 years from now, for sure, that's going to be a complete different story. But we're still in such an early stage with AI. It's kind of like the Internet. It took a while. For the internet and people to get comfortable using the computer to buy products online and stuff before it really took off. I think AI is gonna be a lot faster because it's gonna make things simpler. A really good application is the AI summaries of the reviews. I've started using that all the time on products that I buy. It's one of the first things I go down to to read What the summary of the reviews show to get a better idea so things like that are really helpful a graph like this in the Rufus prompt is It's fine. It's good that it's there But the usage is going to be really low. I think the better usage would be you know having that graph and When you hover over the price or something like that so that consumers can see, you know, have a little link that says price history and when they put their mouse on it or touch it, you know, tap it I guess on the phone, it brings up a price history chart or something. Speaker 1: Yeah, I just want to add to that. I think there was a comment that just flashed by and I agree that, you know, price history, the show price history is actually a prompt that is displayed by default. It's not something that you have to type out. It's probably that Andrew actually clicked on it and that's how he got. So he's saying that It shows up every one to three, almost every one to three. Yeah, I mean, it also depends on where you're searching from and each person's Rufus is going to interact in a slightly different way as well. But I agree. So that's something that Amazon is trying to modularize, which means that your idea, Todd, could very well be a manifestation of how this actually shows up. The show prices stream might actually That part of Rufus might actually be split out into where it's supposed to be, which is where people are actually looking for the price. I mean, the proximity matters, and that's where they're probably going to split all of these prompts out. They're probably going to sprinkle all of these prompts out the way they've already started doing, right? So there's a couple of places where these prompts show up. Number one, they show up in autocomplete. So the last three of the autocomplete nowadays, especially if you have a broad term, They will be Rufus right then right under the image. There's often like three or four prompts that are just embedded in the page flow so you can actually see them. You won't miss them. It's not something like It's hidden in a pop-up or anything like that. But essentially all of Rufus's functionality will be modularized, split out. That's my prediction. It's going to be showing up where it needs to be. And I think things are headed in that direction. So that's one. The second is that I think we're headed into an age of conversational shopping. For example, the big shift that happened for me last year was that I stopped using Google for most things. I'm asking chat, I'm asking based on a bunch of different things that are not just keyword based. That conversational Research or whatever has already happened for a lot of people and that's a behavior shift that Amazon is capitalizing through this. Now when that gains some momentum, it will be easy for them to simply swap out their search bar with a conversation. It just starts with a conversation. What are you looking for today type of thing. And it would be, put as many words as you like into that bar and we'll figure it out and we'll show you. So that's why I'm saying that Rufus gets to be the gatekeeper because whatever you have trained Rufus on through your historical changes that you make on your listing, et cetera, et cetera, are all absorbed and noticed and will be used for or against you. Speaker 3: Yeah, I would agree 100% that eventually Rufus will just be incorporated into the search bar because I'm the same way. I use Grok for just about everything. Grok and ChatGPT, they're each are better at some things than the other. But I find myself routinely, like if I do a search for something, I end up just getting frustrated and jump over to Grok and ask the question there and you get it immediately. So yeah, I could definitely see, and Amazon's got a giant platform, so if they're able to I'm going to talk about how to integrate their AI right into that search bar and have that massive audience start using their AI and have it actually work properly. That'll be important, of course. But yeah, it could be a huge opportunity for Amazon, even over like Google, right? Because Google struggles with incorporating AI into their search results because they don't want to cannibalize their ads and things like that. Amazon could totally do a better job than Google can or easier job, I should say, of incorporating it and not losing the ad sales and stuff like that. Speaker 1: Talking of ads, Rufus is very much showing ads in the flow. I'm seeing ads, I think one of Andrew's posts or somewhere he's mentioned that he actually saw a video ad also inside of the Rufus chatbot. Amazon will protect their ad revenue for sure, given how well they did in Q4. Speaker 3: Absolutely. And Ritu, earlier you said you had something you wanted to share on Rufus. Did you still have that? Speaker 1: Oh, well, it was just an application that I wanted to share. I mean, I can do that right now. So let me share my screen. And I was just trying to show, you know, the whole idea of being prepared for what's to come. And I don't know if you see it, that I had kind of reimagined the, you know, the The search bar and right now it's just these two guys, right? It's just the last three questions that are Rufus, but the whole thing would be Rufus. That was one that I wanted to show and the other one is just being able to extract all of these Q&A or the prompts that Rufus has here. We kind of built these little tools that extract everything. So this kind of It is a way to say that, hey, first of all, get familiar with what Rufus is showing right now and make sure that you have preparedness, like you're ready for whatever questions it's Prompting, you need to have those answers in your listing already, already as in yesterday, because this change is happening so fast that, you know, it could be, you know, the next couple of months when when we see the dramatic shift from Rufus just being in some parts to Rufus being everywhere, you know, in fact, Rufus knows I'm your previous history as a shopper. So what's stopping Amazon from sprinkling in, hey, want to go back to that thing you were looking for the other day kind of thing, you know, like a remarketing effort with a Rufus prompt that sits around somewhere or it just pops up. They're so good at recommendations and so it could just be sprinkled out in many, many places. Yeah, that was the only thing I wanted to go through. Speaker 2: I have something super interesting to show you guys. So while we were going through all this, I I decided to run a little pick-foo poll, open-ended and whatnot. So let's see here. So I asked the simple question, have you used Rufus on Amazon before? And we're still getting some data in here, but so far it's no, never heard of it. Never heard of Rufus. No, I've never heard. I've used it once, I sort of like, but it's inefficient basically. No, never heard of it, never heard, never heard, haven't heard before. So I think this, I mean, you know, very small demographic so far for the PickFu poll, but very much, I think, showing what we had initially kind of talked about here of very unlikely that the general consumer even knows Rufus exists or uses it. I think, you know, it's just, it's in beginning stages, I think is the biggest thing, right? Speaker 3: Yeah. And, you know, it's definitely going to change your CEO for your listing, right? Because you already see it in search terms, you know, somebody searching for, you know, what is the best dog bed? People search for that, but right now the search results are not really tailored for that. But it would be much better if you're shopping as a consumer and you can write, what is the best dog bed for my three-year-old pit bull mix? And Rufus is able to go out and look at the reviews, look at the details, look at the images. And bring back listings that are actually, you know, the right size dog bed for an average pit bull and things like that. Speaker 1: Totally agree. Yeah. And that's coming. I think it's so real what you just described, being able to say that. And that's what conversational shopping is all about, like conversational e-commerce, right? That's basically what it is. Yeah. Speaker 3: And that's really what most e-commerce shoppers still use Google for, right? Because you can't really do that on Amazon. So you jump over to Google and say, what's the best dog bed for a Pitbull? And then you find some articles and you read it and it links you over to Amazon. And so that's just another place that Amazon will lose search traffic once Amazon starts integrating that. Speaker 2: The one AI I like for shopping is Perplexity. I actually use that one quite often because they have the shopping now integrated into the AI for a lot of different websites and whatnot. I use that one quite frequently where I'll just ask, what is the best version of X product and Y? And it'll give me five different products. Here's where you can buy it, how you can buy it, why is the best, so on and so forth. So perplexity is probably The furthest ahead as far as like consumer shopping goes, the issue being that hardly anyone uses perplexity right now. Cause it's just, they don't have much marketing or backing. Right. Speaker 3: So, um, are they connected into Amazon though? I don't think they include Amazon results. Speaker 2: So yeah, no, they didn't used to, but now they do. So, uh, you can now get Amazon links, you can get Walmart links, but honestly for like electronics, It heavily, heavily favors things like Best Buy for electronics and Newegg, right? Over something like Amazon. So I think it, it takes that into account of like, where are these products being purchased, right? And I think that's usually how it does it, whether it's lowest price. Speaker 3: Okay, very good. Speaker 1: That's good. Speaker 3: We have a couple comments here. I'll throw up this one first. Royce1, just on our first article, he says Temu price has increased in the past few months. I don't shop there, so I don't know for sure, but take your word for it, Royce. But then he also says, Last year, Temu took 30% in market share from Amazon. And I'm not sure, I think I read something along those lines of numbers that they increased their share that much. I'm not sure if it was all from Amazon, but it was probably from multiple sources. Speaker 2: I was going to say taking 30%, because Amazon market share in 2024 was roughly 40%. So I don't know how they would possibly take 30% market share from Amazon, right? Speaker 3: Yeah, I think it's just if I remember right, it was 20 something percent of the market that Temu Head taken or something like that in the US. I don't know if that number is accurate or not. Speaker 2: I don't think it could be because I mean for reference the next closest one is all of Shopify stores and that's I believe 10.6% of total market share. So it goes Amazon which is between 37 and 40 and then Shopify as a whole at 10.6 and then Walmart was at 6.7 I think last time I checked. I guess we'll have to wait for the 2024 statistic to come out and tell us. Speaker 3: Yeah, yeah. So maybe it was like a 30% growth. So I asked Grok real quick and it says Temu holds approximately 17% of the market share within the discount store category in the USA. Speaker 2: There we go. See, that's a very specific area to be talking about, the discount store category. Speaker 3: Yep, yep. So maybe they grew by 30%. That might be a correct number, but it's hard to say. We had this comment here as well for you, Ritu. I'm not sure if you can answer that one for our person over on LinkedIn. Unknown Speaker: Unfortunately, it doesn't get to us. Speaker 1: Yeah, you can extract. I'm not sure what QAC is, but SERP and PDP. Can you say what QAC is? Do you guys know what QAC is? Speaker 3: I do not. Speaker 1: PDP, yes. So it can extract from SERP and PDP as well. But I don't know what QAC is. Speaker 3: So supposedly query autocompletion. Speaker 1: Oh, autocompletion, no. There used to be an API that would give us autocomplete, but Amazon shut that down about two years ago. It was a really good way of Just typing any word and getting the whole list of the top 10 autocompletes and that API has been shut down. So unfortunately, I don't have that. But in theory, given that, you know, if there's a human sitting there and starts to type out stuff, And then whatever gets populated in that dropdown, and the dropdown is visible, then it gets, in theory, it should get loaded into the DOM, which is your page, the browser page's backend. And so if, you know, I've been able to extract it from SERP and PDP, so in theory, the autocomplete should also be possible, but that's a good idea, and I'll explore it and maybe share it on LinkedIn when I get a chance. Speaker 3: All right, sounds good. Let's see. A couple other questions here. My brother-in-law and wife have used and bought stuff with it and love the items. Caveat, they asked me to give prompts to help them find what they want. So he must be talking about Rufus, that his brother-in-law and wife have used it to buy stuff. So that's good. I'm sure people are using it and that's, you know, Amazon's collecting data and trying to improve it. And over time here, we'll see it blow up and come into everything, I imagine. But all right, let's go ahead and move on to the next story here What happened there it is so Amazon's international markets should sellers expand or focus on the u.s. According to Scott need him Amazon doesn't disclose revenue for individual international markets, but collectively they represent a significant portion of sale of While expanding globally, especially in Europe and Japan, can offer new opportunities and regulatory challenges and language barriers make it complex. For Amazon Seller, the key question is whether to diversify in the smaller markets or not. So that's definitely a question, but what I really liked here is, or surprised me, I should say, And my question is that Japan has moved into second place at least in SmartScout's numbers. So he says that SmartScout scanned the top millions of products and this is the market size that they got. So this may differ a little bit from what others have put it out there because most people put Germany I believe in second. But according to SmartScouts data, Japan is in second place at $55 billion. Speaker 2: I'd be curious on this. I think this is huge, if it's true. Also, just from a population perspective, right? Because I mean, realistically speaking, seeing Amazon blow up as much as it has in Japan would be, uh, you know, really, really big overall. I mean, Japan is, you know, a huge market to tap into on top, on top of the fact of, you know, Germany, a large reason that is, or has been number two is because it can fulfill to so many of the European countries. Whereas Japan, It's not, right? It's just Japan. So the fact that a single realistic country has kind of overtaken into spot two is really, really big. I would expect Japan to continue over the next few years growing. I would imagine it probably caps out somewhere in the range of $150 billion, just from population size and ability to actually overtake market. It's more interesting to me because I would love to see the comparison of how large the Amazon Japan market is to other vendors with inside Japan, right? So what percentage of the overall Japanese market does Amazon own for e-commerce at this point? And like how much more does it have to grow? But it is really cool to see this just from that aspect alone of yeah, for years, Germany has been number two, if not United Kingdom, right? Speaker 3: So to answer a couple of your questions there, before we started, I mentioned that I just did a podcast with Gary Huang about selling on Amazon Japan. And he was saying that Amazon is the number one e-commerce platform that the Japanese people like to use. So it's definitely growing quickly. The population of Japan is about 36% of the population of the United States. So you were very close, Noah, because if they got 36% of the size of the U.S. market, you'd be at $155.88 billion. Right now, they're only at about 12%, 13%, but it looks like they're growing quick. Speaker 2: Look, am I ever going to get an exact number on the dot? Probably not, but do I know sub 5% of most numbers? I think I can usually get there. Speaker 3: Yeah. What are your thoughts, Ritu? Speaker 1: Yeah, you know, I used to live in Japan. I lived there for 17 years. So I've seen Amazon grow slowly and take over Rakuten. So the takeover actually happened in the middle of the pandemic. Before that, Amazon was smaller than Rakuten. And funny enough, both Rakuten and Amazon were established at nearly the same time in the late 90s. So they've been around for, what, 25 years or so. And this shift actually happened because of their logistics and how, you know, during the pandemic, they were the ones that kind of won a lot of market share because it was easy for people to order from the comfort of their homes and were able to get packets very quickly and so on. So that's when Amazon started becoming big. But the thing is, there's a certain category or set of categories that sell better on Amazon than on Rakuten. So Rakuten happens to be more, you know, attractive to the older demographic because it's a native platform. It's a Japanese platform. And so there's a bigger kind of trust value associated with Rakuten and it's not going anywhere. Like when you want to buy something high quality or more expensive, you go to Rakuten, you don't go to Amazon. Amazon is kind of mentally reserved for sub $50 type of purchases. And by the way, you know, Japan and China are kind of very, you know, close in their trade relations. And Japanese people do not mind buying Chinese products. In fact, the dollar store Daiso is like everywhere. And it's basically Very popular. Most small items are purchased at that dollar store. However, another trend that's happened recently is around the younger generation. So the Gen Z's and the millennials, they have their own platforms. And it's crazy how some of those People, they are invisible on Amazon. They don't buy on Amazon at all because they have their own kind of Gen Z stores and there's so many of them, like 10, 15. So it depends on who you're targeting. And given that Japan's population tends to be older, there's still that balance between Amazon and Rakuten. But as this older generation starts to decline, There's going to be other channels as well that pick up, including LINE, which is crazy how LINE is integrated so well into everybody's lives in Japan. So yeah, it's just interesting that Japan actually moved up from number four to number two there in the data. Speaker 3: Well, that's good to hear. I would say if anybody from Japan is listening to this, keep that split between Rakuten and Amazon. The competition is a good thing. We need more of that here in the United States. So, definitely a good thing to see the competition. Speaker 2: Agree. Speaker 3: Yeah, it's, what are your guys' thoughts on selling in these other marketplaces versus doubling down in the United States? Speaker 2: Depends on how large you are, right? That's always going to be my biggest thing. I think going global is great for brands that, one, have the cash flow to afford it, and two, who are already kind of tapped out where they, whichever marketplace they're in, right? Of course, you can always continue somewhat growing on Amazon for the most part, right? You can always become huge and really, really dig into the US market. But if you have the cash flow and capability to expand into the global market, there's next to no reason not to, right? just leaving sales or potential sales on the table, especially in this day and age. I mean, you can find an agency, you can find a consultant, a VA, anything, even if you don't know, uh, you know, even if you don't know the marketplace for someone else who does, that makes sense. So I'm always going to be something I encourage, but there is a certain level of if you're failing within one market, Try and make sure you're succeeding in that market before you move into another one. Speaker 3: Yeah, for sure. Speaker 1: I agree. I agree with Noah that, you know, you first, you know, establish yourself in whatever market you are and then talk about or think about expanding. And there's an advantage to doing that because you're only kind of working once on your product and your listings and you want to just maybe I advertise that over several markets and take that advantage. There's two other little things that I wanted to mention. First of all, you know, when it comes to, let's say Japan, there's also the proximity to the supply, the supply chain, like how close are they? Typically, the lead times between Japan and China, so China and Japan, They can be as low as two weeks. So if you're going to be low on inventory, the distance between China and Japan, it helps with quick replenishment of goods. And that lead time alone can give you huge advantages when it comes to just cash flow, just from a cash flow perspective. As well as just protecting yourself from inventory, you know, stock outs and things like that. So depending on where you're sourcing, you know, that's another reason for kind of thinking about these other markets. If you're sourcing from Asia, then yes, some Asian markets will make sense. If you're sourcing from India, then India might make sense. And the other thing would be, the product type, like what types of products do you sell and are they a good fit for these other markets or not? A lot of people don't do the right research into their product market fit and then they Kind of make that mistake of just jumping and then realizing that it's not selling. So I think there's something to be said about, you know, that research upfront. I mean, we used to do product market fit analysis for Japanese, for US brands wanting to expand to Japan. And it was amazing what kind of products, you know, We had to kind of audit. In some cases, those concepts don't exist in Japan. In some cases, those sizes won't fit in a house or, you know, it's just a concept that you don't have, like a baby shower. There is no baby shower in Japan. So any products related to that big keyword or around that is not going to work. So I would say it's a little bit of like sourcing as well as the category type as well when it comes to where you want to sell. Speaker 3: Yeah, one example that Gary gave on the podcast was if you sell anything related to cooking stuff in the oven, it's not going to go well in Japan because they typically don't have ovens. So, you know, that whole market pretty much gets exploded over there. So don't send your turkey roaster over to Japan and think that it's going to sell well over there. It's definitely not. I like the idea of expanding into these other markets, but you have to look into all the complications and translations and things like that. And like you said, Noah, make sure you have your home market locked down, maximized, and then start looking at these other markets is probably the best solution. Speaker 2: Yeah, and category is always just going to play a huge part, like you said. Especially like supplement, that's always one that people have horrible time with, primarily because the US market is much more available to be able to sell like whatever supplement you want. But most other world health organizations and everything restrict a lot of different supplements. So the amount of times I've heard someone say, My product is ineligible to be sold in Canada. What do I do? And I'm like, okay, what do you sell? And they're like, oh, XYZ supplement. I'm like, nothing, unless you want to try and start petitioning the Canadian health board to allow it to be sold there. Like, you know, so it's one big thing you always have to think about is, you know, what is your product type? What are you actually trying to sell? Is it even, you know, relevant to other markets, realistically? Speaker 3: Absolutely. Alright, let's jump on to our last story here. Shine, Temu and Amazon Hall face price hikes as US ends trade loophole. So we've been talking about this for a long time and it's finally happened. The removal of the Diminis Deminimus exemption, which allowed low value packages from China to enter the US duty free, is expected to raise prices for Shine, Temu, and Amazon Hall shoppers. This change comes as part of the President Trump's new tariffs, including a 10% duty on Chinese imports. While Amazon Hall may face challenges, analysts believe this shift could benefit Amazon's main marketplace as Temu and Shine lose Their pricing advantage, small and mid-sized online retailers that rely on Chinese suppliers will also feel the impact as they have fewer resources to absorb the increased costs. Um, so in my initial opinion, I think this is relatively a good thing just for, it's, I never like raising taxes, raising fees, you know, I prefer the opposite, but at the same time, you know, we gotta make sure everybody's on an even playing field. Speaker 2: I'd agree. Um, I, I don't, these marketplaces that sell Super cheap products, I think, have a very specific niche. Like what was it you said earlier, Todd, like it's the discount products market? It's such a specific niche. I honestly think like TikTok, for instance, TikTok shop has somewhat played into it because, you know, the way that TikTok shop gained a ton of market share was specifically just by offering insane discounts. And the way that they're offering insane discounts is by them eating that cost, letting sellers pocket the full retail cost. And then, you know, the buyer pays a lesser fee. And it's that type of thing where That only works. For so long, right? And all of these, you know, different, I think, what was the, there was one before Temu and Sheen, there was not Wayfair, but, you know, there have been a million different types of these apps before and... Speaker 3: Wish.com. Speaker 2: Yes, Wish, that's the one I'm thinking of. Speaker 1: Yeah, Wish.com. Speaker 2: There was Wish and then there was like one other one and it, let's think, they've been around for such a long time that I don't think they're going to go anywhere necessarily. Things will get more expensive, but like, It's a very specific market that buys the products there and the people that buy the products there, they know that they're not getting like the highest quality thing in the world and they likely weren't going to purchase a high quality good to begin with, right? So it's like, how much of an effect will this have on overall? Probably not much, but it'll have something, I suppose. Speaker 3: Yeah, yeah, I can't imagine it's going to be, you know, like a huge shift from Shine, Temu and Amazon Hall over to Amazon.com or Walmart.com or something like that. Like you said, there might be a little bit of movement, but it's not going to make a huge difference, I don't think. Speaker 2: Probably not. Speaker 1: I agree. Yeah, probably not. But for these companies, it's going to be a big, you know, loss of revenue because they've already kind of, you know, changed their, I think Temu was, you know, Their kind of page is like now shifted to just show products that are not made in China and you know, just the local products and stuff like that. So yeah, I think it's going to hurt their revenue for sure. But in terms of like, how big of an impact it makes to the overall economy, it's probably going to be small. Speaker 3: Yeah, the interesting number that I've seen in here is that Temu and Shine together likely account for more than 30% of all packages shipped to the United States under the Diminis provisions. So huge amount of products coming in. Well, then down here they say nearly half of all packages shipped under the Diminis come from China. So yeah, that makes sense. Speaker 2: It also makes me wonder though, if it's nearly half, where do the other 50% come from? Are they coming from Mexico? Are they coming from Canada? Are they coming from random other countries? Who knows? But that's something I'd be curious to see what the numbers are there in general, just because if it's like Canada, for instance, that could potentially hurt a lot of Like Canadian Amazon sellers who sell in the US with like remote fulfillment. Is that affected here? I would imagine it is to an extent, right? Speaker 3: Yeah, yeah, that's a good point. I think this exemption was originally set up for, you know, someone is sending you a package from Germany, you know, you don't want that getting hit with tariffs and that's what this was originally set up for. It was not set up for sending mass e-commerce orders through the loophole. Speaker 2: I mean, it's been around since before e-commerce was really a thing, right? So, you know, it's like one of those, yeah, it kind of shaped the e-commerce market scape. Speaker 3: But yeah, yeah, it's more like, you know, a grandma from Germany is sending her great, great grandson a Christmas gift or something, and we're not going to slap her with a With a duty fee for sending that $50 product over. Speaker 2: Yeah. Speaker 3: It's unfortunate that it got taken advantage of. I think it's good that it's closed. The 10% tariff that's on, we'll see where that goes and how long that lasts or if it goes away, if it goes up. It's all going to depend. Trump tends to use these things as negotiating tools. We'll see what happens because we've already seen the pause of Canada's and Mexico's tariffs that he threatened about. So the China one could potentially go away on that as well. But I think the loophole that Temu and Shine and Amazon Hall were using being closed is a good thing overall for everybody. Speaker 1: Yeah, great. Speaker 3: All right, let's see. We've got a few other questions coming in. Royce was asking, where is Rufus located on Amazon? I think it's only on the app, right? It is on the app. It's in the bottom corner. Speaker 1: Well, it's in the top left. There's a Rufus button on your menu bar on Amazon where it says all the different categories, best sellers, toys, games, et cetera. In the left, there's this thing that says Rufus. Speaker 2: I didn't even know that was there. I just saw it now when you said that. I don't think Amazon's good at marketing this. Speaker 3: Yeah, not so much. Speaker 1: They will at some point. Right now, they're just being sneaky and quiet about it, but they're gathering data there. Speaker 3: Yeah, for sure. Speaker 2: Real quick before we move forward, I do have to hop. I have a hard stop here. Thanks for having me on today. Glad to be here and glad to get to chat with you guys and whatnot. Speaker 3: Absolutely, yeah. For sure. Good to see you. Talk to you later. Speaker 1: Good to see you. Speaker 3: Yeah, just we're wrapping up here. So just wish was horrible. And then also the same products sell on Amazon that Temu sells, which is definitely true. A lot of times though, unfortunately, those are knockoffs of the good version of those products on Amazon. Not always the case, but a lot of times that does happen. All right. Didn't mean to throw that up there again. Well, actually, that was a new question. So how as a seller do you need to do make sure Rufus recommends your products over others? Do you have anything on that, Ritu, and then we can wrap it up. Speaker 1: Yeah, absolutely. Basically, this is what we're actually doing as an agency. We're helping sellers get their products ready and indexed within Rufus so that it can start to show you over others. You need to basically make sure that you're extracting all of those prompts that are showing up on your listing. You can also extract prompts that are showing up on your competitor's listing so that you have everything that people are asking and then you proactively answer those questions and get your listings ready for those questions. So that's probably the best tip I can give you at this point. Speaker 3: Are you taking advantage at all or seeing people do it where they're using the frequently asked questions where you can type in the prompt there and ask a question and then Amazon sends that email out for an answer? Are you having people do that and then answer it themselves? Speaker 1: No, no, that's, that's, yeah, we're, we're mostly focused on organic action. So we're not kind of making people do those kind of Q&A. Although I know that a lot of people do that, but we don't. So yeah. Speaker 3: Yeah. Rufus does pick up on those though, right? Speaker 1: It does. It does. Rufus picks up on everything on your listing, any kind of interaction on your listing, as well as outside of Amazon. That's the other thing. If you have any social media, you can be sure that Rufus is scripting everything that you're putting out there. If you're concerned about Rufus, then you have to start building your reputation everywhere, not just on Amazon. Speaker 3: Yeah, AI is the future. It's coming fast. If you're not already using it, definitely get into it because in the next five years, it's going to be running everything that you touch just about, at least online. Speaker 1: Yeah, totally agree. Speaker 3: Awesome. Ritu, this has been fun. I appreciate you coming on the show and everybody out there watching. Appreciate you guys as well. Thanks so much, guys. Definitely happy on again soon, Ritu, and we do this every Friday at 1 p.m. Eastern, so you have a great one. Speaker 1: Thank you. Take care. Bye, guys. Unknown Speaker: This has been another episode of the Amazon Seller School podcast. Thanks for listening, fellow Amazon seller, and always remember, success is yours if you take it. Speaker 3: Hey, if you made it this far in the show, I really hope you enjoyed it and I'd like to ask you a favor. Could you head on over to Apple or Spotify or wherever you're listening to this and leave us a review? It would be greatly appreciated and would help us continue to grow the show and offer more episodes for you. Thank you. God bless and have an awesome day.