Amazon Hits Affiliates (Again); Commerce Data Paints A Grim Picture

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Retail Slump

The Commerce Department estimates that US retail sales dropped by 8.7% from February to March. That’s the worst month-to-month drop since the department started collecting data 30 years ago, more than twice the worst months of the 2008 recession. The definition for retail sales includes all store businesses, gas stations and auto sales, online shopping and spending at bars and restaurants, The New York Times reports. Which means some categories were walloped, while grocery stores, pharmacies and other essential sellers saw a surge of demand. Clothing sales fell by more than half. In March 2019, the Commerce Department reported growth in every retail category. Ready for the bad news? April numbers will probably be worse, since most states didn’t issue shutdown orders until late March or April.

Unaffiliated

Amazon is cutting the rates it pays to some affiliate program partners starting April 21. Affiliate margins on sales of pet products, furniture and home and garden items will drop from 8% to 3%. Grocery product fees drop from 5% to 1%. Some affiliate companies and publishers are panicking, since any that rely on Amazon sales could lose large portions of their revenue, CNBC reports. This isn’t Amazon’s first broadside at the affiliate program in the past few weeks. In March, the online retailer suspended affiliate deals with large digital media companies such as BuzzFeed, Vox and Vice that included minimum payment guarantees. Amazon also removed third-party vendors from its affiliate program, as it forges direct deals with publishers and ecommerce companies.

Honey Pot

Beeswax has acquired MediaGamma, a UK-based ad tech firm that focuses on AI and machine learning, to beef up its engineering footprint and expand internationally. Shuai Yuan, MediaGamma’s head of data science, will join Beeswax as director of data science to head up the company’s investment in machine learning, Adweek reports. Beeswax clients have been asking for more core intelligence built into its platform, which allows buyers to adjust algorithms to improve their targeting capabilities. “MediaGamma was known for custom builds and consulting, now they’re going to be core to building Beeswax products,” said Beeswax CEO Ari Paparo. The purchase was small (terms were not disclosed).

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