Creators, Commission Rates: Zahid Khan decodes Amazon’s festive gameplan

Amazon is all geared up for its annual Great Indian Festival sale, which commences from September 27, 2024, allowing prime members to enjoy 24-hour prior access to exclusive discounts and deals. The Amazon Influencer Program has on boarded more than 50,000 creators and influencers. Amazon has also announced an increase in the Standard Commission Rates for them by a significant margin for important categories ahead of the Great Indian Festival.

The revised commission structures provide influencers a considerable increase which ranges from 1.5x to 2x across an extensive range of product categories, including beauty & personal care, fashion, home, appliances, books, toys, and kitchen for active creators who are working with Amazon. This will help creators earn more during the peak shopping season, capitalizing on the growing consumer demand during AGIF. Moreover, creators will be allocated product budgets of up to Rs 5,000 for purchasing and reviewing products with target-linked incentives of up to 10-15% of the generated revenue.

There will be a rise in commission rates in sub-categories for the following:

Jewellery (except gold coins, bars, jewellery, silver coins, and bars) from 2% to 9%
Fashion, Luggage, Shoes, Watches, Beauty, Home Décor, Toys & Books from 5% to 9%
Personal Care Appliances from 5% to 12%
Sports equipment from 2.5% to 7.5%
Kitchen, Outdoor, Lawn & Garden, Furniture from 6% to 9%

Adgully spoke with Zahid Khan, Director of Shopping Initiatives for India and Emerging Markets, Amazon, to know more about the Amazon Influencer Program, the launch of Creator University and Creator Connect, and what to expect from the Great Indian Festival this year.

The all-important influencers

Speaking on how important influencers are for Amazon and the various programs created for them, Khan said, “There are 800 million internet users in our country today, and it has grown very fast from Tier 3+, which includes rural India. Out of these 800 million, roughly 350 million of them are engaged in some form of online transaction, it could be e-commerce or digital payments. This has been the result of the penetration and affordability of smartphones, as well as the lowest data cost in the world in India. And there has been an explosion in content viewing and content consumption. But this content consumption is driven by content creators and influencers in various regional dialects and languages. 60% of consumers say that their buying decisions are influenced by digital media influencers and creators, so they watch their content on YouTube, Instagram on Amazon with things like product recommendations, and reviews and then that helps them to make their final buying choice. It might be that they look at that content and then go talk to their peers, but that content plays a very key part in the decision-making process and that importance is only growing with time.”

He further added, “We believe that social media influencers will continue to play a growing role in shaping online shopping behaviour. The reason why it is growing is not hard to understand, because I believe end customers view influencer content as authentic. When an influencer that they follow recommends a product or does not recommend a product, many times they will talk about the cons of a product as well. Then that builds authenticity and that authenticity is what they like. And then the influencer endorsement can significantly influence the customer’s purchasing decision. Also, creators present the content in a very creative and engaging format as opposed to other formats like TV advertisements and so on. So, it’s more authentic and more creative. By leveraging the personal brands that these influencers have, they build trust and credibility with their audiences. They also promote product discovery, especially new product discovery or new trend discovery.”

He added that influencers also provide personalized recommendations, so they know exactly what their audiences might want. And then they will tailor their recommendations towards their audience’s very specific needs and preferences. They also help foster a sense of community. Oftentimes, influencers will drive quizzes, promotions, polls, and contests to keep their audiences engaged and the community engaged. And by doing all of this, they drive traffic to online stores. And it is known the traffic typically converts better than other paid sources of traffic. Now, considering the impact these influencers can have on the customer’s buying choices, we have identified this trend well ahead in advance.

The Amazon Influencer Program

Elaborating on the Amazon Influencer Program, Khan said, “We had launched a very specific program called the Amazon Influencer program nearly a decade ago. So, we saw this coming for a while. The Amazon influencer program is a specialized version built on top of the Amazon Associates program. The Amazon Associates program is the oldest and the first online affiliate marketing program that Jeff Bezos launched 25 years ago. The Amazon influencer program is built on top of robust technology and payment systems that are supported by Amazon Associates. So, it’s an extension of the associate’s program. The Amazon influencer program gives influencers all the tools that they need to select the best Amazon products and services. So, like I said, one of the things that an influencer audience is looking out for is what is a trending product. What is a new product that my audience might be interested in? And they are interested in information about those products, the good, bad, and the ugly. Through the Amazon influencer program, we provide influencers all the tools that they need to find the best Amazon products and services and then earn commissions on the qualifying purchases.”

Continuing further, he said, “Once the influencers send traffic over to Amazon and that traffic converts, then the influencers get very attractive commissions on the sales that they have driven. And for a select number of influencers that qualify, we will also feature their content on Amazon itself. This is a massive boost for influencers because it does many things. It improves their brand standing among their followers because they are associating with a high-trust brand like Amazon. It also lets them tailor-make their content even further for an Amazon audience, thereby improving conversions and so on. Now, influencers can start earning commissions when their followers make a qualifying choice via the affiliate links. And then this amount is determined by the number of products that they sell, the category in which they sell them, and so on. This particular Great Indian Festival, I'm thrilled to announce for our creators a very significant increase in the standard commission rates that they will earn for very key categories, and it’s for a very sizable number.”

The Amazon influencer program today consists of over 50,000 influencers. This number is significant because when the Amazon associates program started, the underlying program started in India around 11 years ago with just 5,000 affiliates. Today, the number of influencers alone in the program is over 50,000, while the broader set of affiliates is close to 400,000.

Khan further shared, “There’s a very large and very fast-growing number of influencers that participate in the program. And in this revised commission rate that we are announcing during the Great Indian Festival, it’s a very substantial increase. It ranges from one and a half times the earlier commissions to double the earlier commissions across a very wide range of product categories in very popular categories like fashion, beauty and personal care, home and kitchen, toys, and books. For all the active influencers and creators working within Amazon, this empowers creators to earn more. Just like we expect this great new festival to be super exciting and thrilling for customers, we believe that this increased commission structure will also be very fulfilling for creators themselves, not just the very large creators. Some of our most successful creators are small and mid-sized creators.”

Revised commission rates

Commenting on the revised commission rates introduced by Amazon, he said, “Another really interesting thing that we do that your audience may not be aware of is that we give a product budget for our creators that they can spend as they like to buy products and then try them out and then review them. Because we believe, as creators also believe, that their reviews are only authentic when the creators have used and tried the product themselves. So, during the festival, we are offering creators up to Rs 5,000 in budget to go and buy products and try it out. Of course, they can buy products themselves as well, but this is augmenting whatever the creators are spending by up to Rs 5,000. In addition to the standard commission increase in the product budgets, we are also announcing a target-linked incentive scheme for our top creators that drives certain targeted goals across these categories. This target-linked incentive can go as high as 10 to 15% of the overall revenue that they generate. And this is in addition to all the other ways to monetize. So in all, I feel that this great Indian festival is a pretty great opportunity for creators to be creative, create content on their handles as well as in Amazon Live.”

Amazon Live

Speaking further on Amazon Live, he said, “Amazon Live was launched in 2022, so it has been over a year and a half since the program has been active and it has grown from strength to strength. Today, it employs many creators that create live content. These are creators live streaming their content and reaching an audience on the Amazon app in real-time. And this transcends the traditional boundaries of product display. Now, there’s no barrier between the customer who can come and interact with the creator. And through online chat within the live stream, the creator can answer questions, and even do things dynamically. It’s almost like a physical retail interaction between a shopkeeper and a customer. It enables them to make a better buying choice for the end customer. And it’s also very exciting for the creator to get real time interaction with their audiences, which they find pretty exciting.”

It’s not just about selling and pitching; they can impart the knowledge that they have gained over the years. Whether it is in beauty skincare, in mobile devices, or even in large appliances like ACs and televisions, these creators have very expert opinions about the nitty-gritties of those products, and they provide very credible recommendations completely free of charge to the customer, and thereby it helps them monetize as well.

Khan said, “I think what differentiates the Amazon Live program from other experiences that are similar experiences that are out there, is the underlying technology that is powering these experiences. For instance, Amazon has always prided itself on its personalization algorithms. When you go shopping on Amazon, you will see very relevant products the next time you shop on Amazon. So, we’ve taken those same sophisticated algorithms and then applied them to Amazon Live. This targeted approach streamlines the discovery process and ensures that the customer encounters the content that they like and that has genuine appeal for them.”

Parameters to include creators in the influencer program

Khan explained, “We have over 50,000 influencers that are part of the Amazon influencer program. And this number is only growing. We accept influencers of all shapes and sizes across various categories into the Amazon influencer program, the AIP link, or the Amazon influencer program link. But it’s a straightforward link that influencers can visit, fill out a few information, including their social media handle, and then we just verify that application by checking on the social media handle, whether it is authentic as well as the follower’s account. If they have a sizable followership count, then we enroll them within the program. But that’s just step one.”

Once they register, they have a lot of opportunities to learn through the creator university. And that is a very structured program. Because one thing we have learned over the years is that it is one thing to be an influencer on Instagram or YouTube and put out engaging content, and it is a slightly different skill to create that content in a way that a buying audience or an e-commerce audience will consume and hopefully shop. So, the Creator University helps teach those skills to creators that enroll in the program.

“Every influencer can curate products and create a storefront, which is hosted within Amazon as well. And then they can send their traffic to Amazon or customers can naturally discover it within Amazon. In that regard, when somebody watches live content which is exclusively on Amazon, they can discover the previously live content as well whenever a purchase is made via that content. Then again, the creator earns a commission rate. So this is the way how both Amazon and the creator benefit. As far as how much traction it drives, just to give you a sense, this Great Indian Festival, we will run over 1,500 live streams during the duration of the event across mobile phones, home appliances, home decor, fashion, and beauty. The engagement rates on some of these live streams are mind-boggling,” he added.

Fashion Influencer Program

“One very successful program is what we call the Fashion Influencer program, which is a subset of the Amazon Influencer Program that focuses on fashion,” said Khan, adding, “And therein we have roped in many successful creators of premium brands and brands that are very well recognized. And these folks host content and they are upper funnel content, like styling content, five styles to dress this summer or this winter, or five things that go with these pairs of shoes, and so on. And that has resonated with our customers. Customers follow those they watch, that content rate is very high on those social media handles and so forth.”

Enhancing consumer experience

Khan explained, “One of the most important parts is that once the creators sign up to the program, we share with them what is trending on Amazon so that they can then go and create content within their respective categories and sub-categories tailor-made to these trending products and styles. The second part is the high commission rates, which is also a pretty big incentive for them to participate in this Diwali. And finally, we have upped the volume of live streams that we will do to 1,500 during the Great Indian Festival.”

The expectations

“We expect this Great Indian Festival to be even larger than the prior year, with the sellers and customers that we are already seeing even during the pre-festival period. And the way we are planning to bank on this, especially for creators, is through very specialized curation that we’re sharing with them in the pre-Diwali period so that they can prepare well. Within the Creator University, they can go and look at very specific content. The commission structure that we’ve increased has been very specifically chosen to increase in those categories where we feel there will be maximum sales during this Great Indian Festival and thereby, it will not only be a very successful event for our customers, but also for our creators. So, these are a few ways in which we think creators will also have a very successful Great Indian Festival sale.”

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