Chinese merchants flooded to Amazon … then thousands got banned

Original image by Pete Linforth

Seven years ago, I was writing about cross-border e-commerce to China. Now I find myself writing about cross-border e-commerce again, but this time goods move from China to the west. According to a report by the Center for China & Globalization (quoted by Sixth Tone) more than a quarter of all global cross-border ecommerce originates in China, ranking first ahead of the U.S., U.K., Germany, and Japan. In a series of articles, I will explore this trend, starting with how Amazon caused an explosion in cross-border e-commerce from China and how it changed its marketplace.

A few years ago, something strange started happening on Amazon. I first noticed it when during the COVID lockdowns I was buying some equipment for a home studio for online lectures. When I searched for a ring light, I found how some products had ridiculously long descriptions, without any use of punctuation. 

Despite the many positive reviews, the first ring light I bought was a disappointment. It could not be assembled because screws and screw holes were not matching. I returned it and ordered a different ring light, which like the first one had an absurd product description. I also noticed how those products came with large numbers of pictures, like you often see on Chinese websites. Chinese consumers prefer to have many pictures because it gives them more trust in the authenticity of a product.

After buying several other accessories I realised that the sellers of those items were almost all Chinese companies from China’s Guangdong province. The city of Shenzhen alone proves to have more than 40.000 firms involved in the cross-border e-commerce business, accounting for 35% of all cross-border e-commerce from China. In 2020, the New York Times wrote: “Almost half of top Amazon sellers — those selling more than $1 million in the U.S. — are in China; about a third of Amazon’s Chinese sellers overall are estimated to be in Shenzhen.”

On Amazon, company names and addresses have been Romanised, leading to seller information like:

Shenzhenshi zhenshangshu kejiyouxiangongsi, longgangqu bantianjiedao maantangshequ bulonglu227hao, getailonggongyeyuan, Bdongchangfang 205, shenzhen

As you see, Mandarin can look very strange when romanised, with lack of spaces making it even hard to read for someone familiar with the language.

Bizarre brands

Since 2013 Amazon has been recruiting merchants in China to sell on its marketplace as part of its strategy to evolve from pure e-tailer to a marketplace. In 2019 60% of Amazon’s gross merchandise value (GMV) came from third-party sellers, up from 6% in 2001. To shorten delivery times Amazon offered Chinese merchants ‘a logistics system, “Dragonboat,” which for a fee brought goods made in China and elsewhere to Amazon fulfilment centres in the U.S.’ In 2015 the Amazon website also became available in Mandarin for Chinese sellers. 

In recent years many Chinese merchants have been highly interested in joining Amazon’s platform since competition on China’s domestic platforms, like Alibaba’s Taobao, was getting fiercer and thereby profit margins started to get squeezed. 

As the New York Times reported in 2020, Amazon started to get flooded by brands with bizarre names like Nertpow, SHSTFD, Joyoldelf, VBIGER and Bizzliz. These seemingly carelessly chosen brand names with shortages on syllables are the result of Amazon requiring registered trademark to allow merchants to sell on its platform. In 2018 The Wall Street Journal had reported how the U.S. Patent and Trademark Office was being flooded with trademark requests from Chinese citizens; one in every nine requests originated in China and most involved small online merchants. Many requests originated in Shenzhen, where the local government was offering up to $800 in subsidies to purchase a U.S. registered trademark.

Chinese merchants tend to choose these bizarre brand names because there is little chance of conflicts with existing trademarks, thereby making the registration process fast and easy. They also have little intention of actually building those brands, registering countless names just to be able to sell on Amazon. These trademarks are often even used for a wide range of highly unrelated products.

Black hat tactics

As on Chinese domestic platforms like Taobao and Pinduoduo (link in Dutch), not everything Chinese merchants sell is of high quality. Amazon has seen frequent problems with shoddy or even downright dangerous goods, as The Wall Street Journal reported in 2019. 

And it’s not just dodgy products that these Chinese companies moved from domestic platforms to Amazon. Many dubious and fraudulent practices that have always plagued the Chinese internet (link in Dutch), came along. In the case of Amazon, it was mostly fake and incentivised reviews that were the problem. Fake reviews could either be positive reviews for a merchant’s own products or bad reviews for those of their competitors. Incentivised reviews involve rewarding actual customers for leaving a positive review or deleting a negative review, a practice Amazon banned in 2016.

But there were more of these so-called ‘black hat tactics. In 2018 The Wall Street Journal showed how scammers in China triggered suspension of competitors by Amazon’s automated system. They would order products and return them, flagging them as dangerous or fake. It can take weeks for the victims to get their products or even their whole suspended store back online. Brushing – ordering of products by commissioned third parties who then write positive reviews – is another common tactic to get products ranked higher. To make it look like an actual order, dummy boxes without the actual products are sometimes sent to the brusher or, if they want to avoid attention, to random addresses (link in Dutch).

According to sources of The Wall Street Journal “concerns at Amazon about Chinese listings arose several years ago in its China team, which noticed that as local sellers flocked to the platform, it saw increasing patterns of fraud, counterfeits and unsafe products.” But sometimes employees in the China team were part of the problem…

In 2019 Buzzfeed published an article about Chinese companies that provide ‘black hat tactics’ services to merchants, game Amazon’s algorithms and manipulate its product rankings. One company claimed to be bribing Amazon employees, mostly based in China, to get classified information like reasons for account suspensions, data on competitors and even e-mail addresses of buyers that wrote critical reviews (something also reported by The Wall Street Journal in 2018). Another company offered services to manipulate reviews and remove bad reviews. A third company could use connections among Amazon’s staff to get suspended accounts reinstated. A fourth company offered a service in which it replaced a product on an existing page while maintaining the old product’s (positive) reviews. This company also offered a $10,000 training on black hat tactics to Americans, teaching participants “what people are doing out there in China.”

(If you want to know more about the various ways in which Amazon’s system gets gamed, check out this article and the accompanying podcast by Ecomcrew.)


For years Amazon seemed to turn a blind eye to these problems. More Chinese merchants was exactly what Amazon wanted for its ‘virtuous cycle’ theory in which more sellers with lower prices leads to a better customer experience, which in turn leads to more traffic and thereby more interests from sellers. Lower prices were exactly what these Chinese merchants could offer and Amazon seemed willing to ignore a few rotten apples in the basket. That is, until all the negative press started in some of the aforementioned American newspapers.

In May 2021 Amazon decided to finally crack down on bad practices. Accounts were suspended and funds as well as the concerned merchants’ inventories in Amazon’s warehouses were frozen. In September 2021 Amazon announced that because of fake reviews and other violations it had closed more than 50.000 stores and suspended the accounts of 3.000 merchants that were selling 600 brands. Many merchants were found to be running multiple accounts, something Amazon’s terms and conditions also forbid. 

Checking my previous ordered ring lights on Amazon, I found that both products were no longer available. The merchants I bought them from seem to have been removed as well.

Note that this article does not want to imply that all Chinese merchants on Amazon use black hat tactics, nor that those tactics are only used by Chinese merchants. Ecomcrew estimated that there are close to one million Chinese merchants on Amazon, so the number of banned accounts is only a fraction of this. The platform claimed that the ban did not negatively impact the overall growth of Chinese sellers on its marketplace.

The other side of the story

In the Techbuzz China Insider Community Rui Ma argued that there was more to the story. Some of the banned merchants and brands were selling high quality goods, which made her wonder why they would risk their flourishing business by breaking Amazon’s rules. Ma explained that in the early years of the last decade, the number of Chinese merchants joining the Amazon marketplace exploded because they could easily sell their goods for 20-30 times the price, they could charge on a domestic website like Taobao. By 2017 one third of all international sales on Amazon’s marketplace originated in China.

On its marketplace, Amazon charges commission for sales (15%), advertising costs for visibility and possibly also warehouse and logistical costs if a merchant uses ‘FBA’ (Fulfillment by Amazon). Ma described how many Chinese merchants initially shipped goods from China to the buyers, but after 2011, when Amazon began pushing its Prime membership, merchants had to use FBA to be eligible to sell through Prime. According to Ma’s figures, logistical costs have risen by more than 250% since 2013, while advertising costs have increased by 50% during the pandemic. Add to this the costs of shipping goods to the Amazon warehouses and you’ll see how the margins of the Chinese merchants have been squeezed since joining Amazon. 

On top of this, Amazon’s recommendation system focuses on products instead of reputable merchants. A search result on the platform shows multiple offerings of a specific product, with the product with the highest sales for that product shown first. To be visible at all, some merchants revert to gaming the system.

A merchant interviewed in the Buzzfeed article claimed he wouldn’t survive without black hat tactics. Prior to using them he needed to spend 30% of his sales on advertising to be visible at all among the competition on Amazon.

The suspension of their Amazon account has hit some merchants hard. Marketplace Pulse reported that some of them had laid off staff or even went bankrupt. The Shenzhen Cross-Border E-Commerce Association, a trade body representing more than 2,600 cross-border trading companies in Shenzhen, estimated the loss for Chinese merchants caused by the Amazon ban to be more than 100 billion RMB (about €14,5 billion). In the meantime, Amazon’s problems with Chinese sellers are far from over, as a recent case in which the e-commerce platform and jewellery brand Cartier sued an influencer and eight merchants for selling fake Cartier goods shows.

In the next article in this series, we will see how the Chinese merchants are responding to Amazon’s hardened enforcement of its policies by finding alternative sales channels.