Amazon’s New Small Business Badge: What Is It and Will It Pave the Way for Small Businesses?
As the cost of living rises, consumer shopping habits are changing. Supporting small businesses is more important than ever. Research from ActiveCampaign suggests that amid high inflation trends, 56% of consumers are prioritising making purchases from small businesses.
But what does this mean for the big dogs, namely Amazon, Alibaba, and Walmart? Will we see the fall of the retail giants?
Most likely not. In recent weeks, Amazon has embraced this change of shopping habits, starting with the launch of their “Small Business” badge.
A lot of small businesses have a love/hate relationship with Amazon, so will the new badge empower entrepreneurs with the tools they need to grow? Or is this a tactical marketing ploy aimed at keeping audiences engaged?
Keep reading to find out what the small business badge is, how to enrol in the programme, and the benefits it bestows to sellers.
What is Amazon’s Small Business Badge?
In a Seller Forums entry dated 28th April 2022, Amazon announced:
“As part of our ongoing commitment to the success of small businesses, we are excited to share that over the coming months we are testing a Small Business badge to help customers identify products from small business brands and artisans in Amazon’s store.”
As the name suggests, the badge is aimed at improving visibility and discoverability of products from smaller businesses, encouraging shoppers to think twice about who they’re giving their money to.
The good news is that participation in the small business programme is completely free. Unlike other Amazon badges, eligibility is not based on performance or algorithmic parameters.
Once enrolled, the Small Business badge is displayed on both search engine results pages and product detail pages:
What is a Small Business?
So, how does Amazon define a ‘Small Business’? Amazon’s official FAQ page for the Small Business badge states:
“In the UK, we follow the European Commission’s definition of small and medium enterprise. Businesses are eligible for this badge if they are brand owners registered with Brand Registry or participate in the Handmade program. The specific products that receive the badge are from small and medium business brands and artisans based in the UK.”
Expanding on this during an interview with Forbes, Director of Small Business Empowerment at Amazon, Keri Cusick said:
“It’s critical to us that we define small businesses in the same way our customers and business partners do […] small businesses are those with fewer than 100 employees and total annual revenue of less than $50 million.”
The logic is clear but having an annual turnover of $49 million isn’t exactly what most of us picture when we think of small businesses.
Under such a wide definition, it’s estimated that 99% of all EU businesses and more than 50% of Amazon sellers classify as small businesses, making large businesses a minority.
Applying for Amazon’s Small Business Badge
Enrolment in the Small Business programme is automatic if:
- You’re a brand registered seller or participate in Amazon Handmade
- Have fewer than 100 employees
- Have an annual revenue of >$50million
This means that all products registered to your brand will feature the Small Business badge in the marketplace where your business is established.
Nevertheless, if you spot any errors, you can contact Seller Support with the name of your brand, business address, and merchant token ID, and their internal team will manually review your eligibility. This process is expected to take approximately 10 working days.
Benefits of Amazon’s Small Business Badge
If you’ve made it this far you’re probably wondering, “if most sellers are eligible for the Small Business badge, what benefits does it convey?”. Well, you’re right to ask.
The main benefit sellers can expect to see from the Small Business badge is an increase in sales.
In a study released by Go Compare in June this year (2022), researchers found that despite the UK cost of living crisis, an overwhelming majority of Brits are continuing to shop small. In fact, 27% said that they were now buying from small businesses more often to help support them with rising costs.
What’s exciting is that these findings are reinforced by Amazon themselves.
In the same Forbes interview cited above, Keri Cusick stated, “independent businesses account for over half of all products sold. Actually, their sales continue to outpace our own retail sales”.
This aligns with Amazon’s most recent Prime Day, where small businesses were heavily prioritised in the “Support Small Businesses to Win Big” incentive.
In the three-week run-up to the main event, for every £1 spent on products from small businesses, shoppers received one entry into sweepstakes to win big prizes, including tickets to Super Bowl LVII, Amazon gift cards, and tickets to a special screening for the upcoming Lord of the Rings: The Rings of Power series.
Across the globe, this resulted in more than $3 billion in sales for small businesses. Customers purchased over 100 million small business items.
You heard it here first; small businesses are the next big thing!
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