Amazon is cutting seller fees, which shows how seriously the corporation takes the growing power of low-cost competitors like Shein and Temu. This change is one of the biggest charge changes Amazon has made in years. It is focused on the areas where its competitors have been gaining ground the fastest, such as cheap apparel and everyday accessories. This move seems like Amazon is tightening its grasp on a market that changes its online purchasing preferences virtually every season. This is because the market is moving towards platforms that offer discounts.
This choice comes at a time when people are more sensitive to pricing than ever before. Inflation has changed what people want to buy, and online buyers have become quite good at finding deals by easily comparing possibilities across applications and marketplaces. This change has been very good for Shein and Temu. Customers have learnt to anticipate attractive things at rates that seem too good to be true thanks to their catalogues, which include anything from pastel scrunchies to LED lamps. When I look through their postings, it’s evident why the talk about value has shifted so much. The price tags alone will get you to buy, even if you don’t want to.
Amazon, which has been the biggest player in European e-commerce for years, couldn’t ignore the trend. Its solution has taken the form of a targeted charge cut that will enable vendors drop their pricing without cutting into their already small profit margins. Amazon explained the change in a statement announcing the update. They said, “As we continue to lower our cost to serve through operational improvements and innovation, we are passing on greater savings to our selling partners.” That comment shows that something more than a business change is going on. It means a change in strategy and a vow to maintain its marketplace ecology competitive.
The fee cut is mostly for clothes and accessory listings that cost less than 20 euros or 20 pounds. This is the price range where Shein and Temu have been most competitive. Amazon is lowering its referral fee from 7% to 5% for items that cost up to 15 euros or 15 pounds. The fee will now go down from 15% to 10% for items that cost between 15 and 20 euros or pounds. These adjustments will start on December 15 and will likely affect a lot of small sellers, especially those who need to sell a lot of cheap goods to keep their stores open.
The time is considerably more important because of the competition. Shein presently charges a 10% referral fee on its EU platforms and a 12.24% cost in the UK. However, new sellers can get a 30-day promotional period during which there are no referral fees. Many new sellers have a strong reason to try out Shein’s shopfront before fully committing to the marketplace because of the initial offer. But Amazon’s new structure might bring some attention back to its larger ecosystem, which offers a different form of stability through well-known trust structures, a large logistics network, and predictable customer behaviour.
Shein has been a significant competitor in part because it has combined low prices with algorithm-driven trendspotting. Products go from TikTok to the virtual runway of its mobile app practically right away. A blouse that costs 3 euros or a pair of jeans that costs 8.20 euros is no longer just a good deal; it’s a sign of how quick fashion, social media, and global supply networks are changing the way people choose what to wear. On the other hand, Temu has gained a reputation for having almost anything someone could think of needing. It has become a place to buy things like vacuum cleaners, duvet coverings, hair dryers, kitchen organisers and strange devices. The element of surprise draws people in.
Amazon is most worried about the speed at which both platforms have been taking market share, not just the prices. People in Europe are eager to test out new shopping platforms if it means spending less for ordinary things. When I think of the average customer experience, it feels like going on a treasure hunt. Every time you refresh, it feels like you might find something that is surprisingly cheap.
Amazon is still a strong presence in Europe, though. It is still widely seen as the best place to shop online in Germany, France, Spain, Italy, and many other big markets. Ecommerce Europe says that this year, digital retail sales across Europe are expected to expand by about 7%, possibly reaching 900 billion euros. A market so big can have a lot of participants, but it also makes the biggest ones compete more fiercely. Amazon’s decision to lower its fees shows that it not only wants to be a part of this developing industry, but also wants to set the rules for how people do business in it.
There is more to the seller community than just the numbers. Many independent vendors in Europe work alone or in small groups from home offices, warehouse nooks, or modest studios. For a lot of them, adjustments in fees like this don’t seem like they are real. A two percent decline in low-priced listings could mean more inventory, better packaging, or just a little additional breathing room during months when sales slow down. I can easily envision a tiny seller in Berlin or Barcelona reading Amazon’s news and letting out a silent sigh of relief. They could even hope that this is the start of policies that are better for sellers.
How customers react will determine the bigger effect. If the decreased fee lets Amazon merchants offer pricing that are even a little bit cheaper, it might have a big effect on how people think about shopping. European shoppers are often forceful value searchers, and even a small price difference can make them switch platforms. But Shein and Temu are appealing for more than just their prices. Their apps are designed to be fun places to hang out, with lots of colour, fast-loading feeds, and instant satisfaction. Amazon’s interface has always been more useful than enjoyable, even though it works well. That difference changes how people act in ways that data can’t measure.
