Hi everone,

I recently created a coupon for my product and it’s been working really well. I actually prefer it over PPC since my ACOS has been much lower - about 16%. Coupons seem like a pretty inexpensive way to get Amazon to promote your listings in their Deals pages.

Now, at first, I thought that Amazon only charged $0.60 each time a coupon was redeemed. After noticing the math not adding up I found out that it’s $0.60 per redemption + the amount of the discount - in my case $1.00. So $0.60 + $1.00 = $1.60 which is still pretty good. Currently, my product is also on sale for $9.99 so buyers really want to take advantage of the sale + coupon. When my sale expires at the end of this month my price will go back to $12.99. I had thought about creating another coupon in the future for $3.00 off the regular price of $12.99. But that will mean that I will need to pay Amazon $3.60 for each redeemed coupon.

Can someone please help me understand how this makes sense? Why do I pay MORE just because my discount is higher? Why does Amazon feel like they should get the $3.00 discount in addition to the FBA fees they normally get, plus the $0.60 coupon fee? Their FBA fee for my product is about $5.00. So why isn’t $5.00 still good enough if I offer a coupon? I understand that I do get some extra visibility from Amazon when I create a coupon but that doesn’t change when I go from a $1.00 discount to a $3.00 discount - or does it? Does Amazon do anything more to promote my product if I offer a higher discount?

I’m just trying to wrap my head around this. My products have been recommended for Lightning Deals which I am considering even though I will end up losing money. It would be more for brand exposure so it would be worth the hit. But I just don’t understand why ANYONE has to pay for the discount I provide; $1.00 or $3.00.

Thoughts?

Thanks,
Joel