The FTC is challenging the mechanics behind Amazon’s advertising auctions
The FTC and 22 state attorneys general have sued Amazon over the way it priced Sponsored Products, Sponsored Brands and Sponsored Display advertising. The complaint alleges that approximately 1.2 million advertisers were overcharged by more than $20 billion through undisclosed reserve prices that increased what winning advertisers paid.
Amazon disputes the allegations. The company says advertisers never paid more than their submitted bids, reserve prices are common in advertising auctions and Sponsored Products CPCs remained flat after inflation from 2019 through 2024 while conversion rates improved.
What Changed
The biggest development is not simply that Amazon is facing another lawsuit. It is that the complaint provides an unusually detailed look at the mechanics of Amazon’s advertising auctions.
The FTC says Amazon continued describing its system as a generalized second-price auction while using what internal documents called a “soft reserve price” or “proxy second price.” According to the complaint, Amazon could substitute this reserve for the actual second-place bid, increasing the winner’s CPC without disclosing that intervention to advertisers.
Why It Matters
Amazon advertisers have spent years treating CPC movement as a combination of competitor activity, seasonality and bid pressure. The complaint introduces another possible variable: Amazon’s own valuation of the placement.
That does not make current advertising reports unusable. It does mean advertisers should be careful about assuming that every CPC increase directly reflects more aggressive bidding by competitors. It also raises a broader question about how much visibility advertisers should receive into retail media auction mechanics.
What Is Not Changing
There has been no court ruling, refund program or announced change to Amazon’s advertising auctions. The complaint contains allegations that Amazon contests, and the case could take years to resolve.
Advertisers should continue optimizing against actual contribution margin, conversion, CPC, ACoS and total sales performance. The lawsuit alone is not a reason to pause campaigns or make sweeping bid reductions.
What to Do Now: Light preparation recommended
Preserve historical campaign, search-term, placement, CPC and billing reports, particularly around Prime Day, Black Friday and other high-volume periods. Agencies should also ensure that their client agreements and data-retention practices allow those records to be retrieved later if a settlement, claims process or advertiser audit eventually follows.
Bigger Picture Signal
Retail media has grown faster than the transparency and measurement standards surrounding it. This case could become an important test of how clearly marketplaces must explain auctions when they operate as the retailer, advertising platform, auctioneer and reporting provider at the same time.
Sources: Amazon’s ad auction surcharges secretly bilked brands of billions, FTC alleges – FTC complaint against Amazon
Canada’s countertariffs take effect September 8, creating an immediate landed-cost change
Canada will impose tariffs of 15%, 25% or 50% on $27.6 billion in US-origin goods beginning at 12:01 a.m. on September 8. The countermeasures match recent US tariffs and cover categories including steel, dairy, appliances, agricultural equipment, electronics, pulp and paper, along with selected apparel and textile classifications.
What Changed
For affected goods, the tariff becomes part of the cost of importing the product into Canada. The applicable rate depends on the product’s tariff classification, so the impact cannot be determined from a general category description alone.
The rule is based on the product’s origin, not simply the country from which the parcel is shipped. Moving a US-origin product through another warehouse or fulfillment country does not automatically remove the tariff.
Why It Matters
Sellers shipping from the United States into Canada can see margins change overnight, particularly if duties are not already included in pricing. Unexpected import charges can also create refused deliveries, customer-service contacts and returns when the buyer is responsible for paying them.
The risk is not limited to direct-to-consumer shipments. Distributors, wholesale customers and Canadian marketplace inventory replenishment can all be affected.
What Is Not Changing
Goods already in transit to Canada when the countermeasures take effect are excluded. Products that are not US-originating are not automatically covered merely because the seller or warehouse is located in the United States.
The tariff list is defined at the Harmonized System classification level. Sellers should not assume that every product within a broad sector has the same rate.
What to Do Now: Immediate operational check
Review Canadian sales by SKU and confirm the HS code, country of origin, importer of record and duty responsibility for each meaningful product. Recalculate landed margin using the applicable tariff rate, then decide whether to reprice, pause the offer, change sourcing or absorb the cost.
Customer-facing delivery and duty language should also be reviewed before new affected orders are accepted.
Bigger Picture Signal
Tariff exposure is becoming increasingly SKU-specific and jurisdiction-specific. A single global margin assumption is no longer sufficient for brands operating across the United States and Canada.
Source: List of products from the United States subject to countertariffs effective September 8, 2026
Alexa+ is now available to every US Prime member, expanding AI-mediated product discovery
Amazon has completed the US rollout of Alexa+ and included unlimited access with Prime. Non-Prime customers can use a limited text experience for free or pay $19.99 per month for the complete service.
This puts Amazon’s generative and agentic assistant in front of a much larger audience across Echo devices, the Alexa app and Alexa.com.
What Changed
Alexa+ has moved from early access to broad availability. Amazon says tens of millions of users participated during the early-access period and that customers interact with Alexa+ more than twice as much as they did with the previous Alexa experience.
Earlier Amazon results also showed that more than 350 million shoppers had used Alexa for Shopping during the preceding 12 months, interactions increased fivefold year over year and users spent approximately 40% more per order than shoppers who did not use the assistant. Those figures are Amazon-reported and should be treated as directional rather than independent measurement.
Why It Matters
A growing number of customers may reach product pages through a conversational recommendation rather than a conventional keyword search. The assistant can interpret use cases, compare options and narrow consideration before the shopper sees the familiar search-results page.
That makes complete product attributes, compatibility information, use-case language, review quality and catalog consistency more important. An AI assistant needs structured information that it can confidently interpret.
What Is Not Changing
Amazon has not published a new seller-specific Alexa optimization tool or a confirmed ranking formula for conversational recommendations. Sellers should be cautious about anyone claiming to have discovered an “Alexa+ algorithm.”
Traditional search placement, advertising, conversion, availability, price and reviews still matter. AI discovery is an additional interface, not yet a replacement for the existing marketplace.
What to Do Now: Light preparation recommended
Review priority listings for missing attributes, vague titles, incomplete compatibility information and unanswered customer questions. Product pages should clearly explain who the product is for, what problem it solves, what is included and how it differs from alternatives.
No separate Alexa advertising budget is required at this point.
Bigger Picture Signal
Amazon is positioning the AI assistant as both a Prime retention benefit and a shopping layer. If adoption continues, marketplaces will increasingly decide not only which products rank, but which products are included in an AI-generated consideration set before the shopper ever views a results page.
Sources: Alexa+ now available to everyone in the US and free for Prime members – Amazon Prime members now get free Alexa+ access
eCommerce Had a Week.
Quit Scrolling and catch the latest episode of Selling on Giants: Weekly eCommerce News & Updates.
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In this episode:
🔹 New Amazon insurance requirements
🔹 Amazon’s $20B advertising lawsuit
🔹 Q4 margin pressure
🔹 Alexa Plus and AI shopping
🔹 Target’s AI-powered baskets
🔹 Sephora launches on TikTok Shop
🔹 Good Good Golf’s distribution crisis
🔹 Walmart’s $6 chicken purse
Sephora is launching exclusive monthly product drops through TikTok Shop
Sephora will begin piloting its US TikTok Shop experience on September 19. The Sephora Drop Shop will feature monthly product launches supported by teasers, creator content, interactive experiences and a TikTok Live reveal.
What Changed
Participating products will initially launch exclusively through Sephora’s TikTok Shop. Select products may become available later through Sephora.com, physical Sephora stores and other retail partners.
Customers can preview products on Sephora’s site during the exclusivity period, but purchasing will initially take place inside TikTok Shop. Sephora says beauty generates more than one billion searches per month on TikTok.
Why It Matters
This is not simply another retailer opening a TikTok storefront. Sephora is using channel exclusivity to connect entertainment, product discovery and checkout within one coordinated launch.
The model gives Sephora control over which brands receive visibility while TikTok controls the discovery environment. Participating brands gain reach, but the retailer and platform own most of the customer relationship and performance data.
What Is Not Changing
This is currently a US pilot, not a full migration of Sephora’s ecommerce assortment to TikTok. Sephora continues operating its website, stores and existing retail channels.
Brands should not assume that strong Sephora performance automatically guarantees inclusion in a Drop Shop activation.
What to Do Now: Light preparation recommended
Sephora partner brands should ask how brands are selected, what inventory commitment is required and which party controls creative, promotion and reporting. Pricing and launch calendars must also account for temporary TikTok exclusivity.
Bigger Picture Signal
Social commerce is evolving from individual creator sales into retailer-curated marketplace experiences. Brands may increasingly access TikTok audiences through major retail partners instead of operating every social storefront independently.
Source: Sephora launches on TikTok Shop with Sephora Drop Shop
Good Good Golf’s ad controversy now includes executive departures and retailer delisting
The fallout from Good Good Golf’s widely criticized advertisement has expanded beyond negative social-media attention. CEO Matt Kendrick and President Joe Flannery have now left the company, with co-founder Nahid Giga serving as interim CEO.
What Changed
The deleted advertisement showed a male Good Good personality shoving a female employee while promoting a Callaway-branded driver.
Callaway ended the partnership and committed $1 million to organizations addressing violence against women. Dick’s Sporting Goods and Golf Galaxy removed Good Good merchandise, the company withdrew as title sponsor of a PGA Tour event and Golf Channel scrapped its planned Good Good reality series.
Why It Matters
This is a clear example of reputational risk turning into distribution risk. The brand did not simply lose positive sentiment. It lost retail placement, media distribution, an equipment partnership, sponsorship visibility and senior leadership within days.
Retailers often act faster than legal systems because they need to protect their own customer relationships. A brand can therefore be removed before it has time to complete a traditional crisis-response process.
What Is Not Changing
This incident does not establish a general retailer policy covering every controversial post or creator mistake. The response reflects the content, public reaction and number of commercial partners connected to the campaign.
Good Good continues operating as a brand, but its distribution and leadership structure have changed materially.
What to Do Now: Immediate operational check
Brands working with creators should confirm that contracts include content approval, usage rights, conduct standards, takedown requirements and termination provisions.
Campaigns involving retail partners need a documented final-approval process. If a controversy occurs, the response plan should include retailers and distributors, not only customers and social-media followers.
Bigger Picture Signal
Influencer brands are becoming real consumer-product companies, but their content operations do not always mature as quickly as their distribution. Retail scale requires governance that goes beyond creator instinct.
Sources: Good Good Golf CEO and president leave after controversial ad – Good Good loses Callaway deal and PGA sponsorship
Walmart turned its rotisserie chicken into a sold-out fashion product
Walmart launched a limited-edition purse modeled after its rotisserie-chicken packaging for $5.97, the same price as the food item. The September 1 release sold out within hours and quickly appeared on resale marketplaces at several times its original price.
What Changed
The purse launched in Traditional and Lemon Pepper versions with coordinating charms based on chicken, hot sauce and seasoning. Walmart says its rotisserie chicken received more than 15,000 social mentions during the previous year and that approximately one in every 12 Walmart customers purchases one annually.
Instead of manufacturing a random novelty product, Walmart converted existing customer behavior and social conversation into a limited merchandise release.
Why It Matters
The campaign connects several strong merchandising elements: a recognizable everyday product, an exact price reference, limited supply, visual humor and content designed for social sharing.
The resale activity is not meaningful revenue for Walmart, but it confirms that the release created cultural demand beyond its functional value.
What Is Not Changing
Novelty products do not automatically create long-term customer demand. The limited quantity and low price contribute heavily to the attention.
This does not mean every popular SKU should become merchandise. The underlying product needs recognizable packaging, customer affection or an existing social conversation.
What to Do Now: No action required, monitor only
Brands should identify products, packaging elements or customer behaviors that already generate organic conversation. Those assets may support limited merchandise, bundles, gifts or creator campaigns.
The lesson is to build from existing customer affection rather than manufacturing a forced viral moment.
Bigger Picture Signal
Some of the strongest retail marketing now begins with the product becoming content. Walmart turned a routine grocery item into a social object, giving customers a reason to share the brand without relying on a traditional advertisement.
Sources: Walmart serves up a limited-edition rotisserie Chicken Purse – Walmart’s sold-out chicken purse reaches resale sites
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