The Dominance of Chinese Sellers on Amazon

According to recent data, Chinese sellers make up 63% of all third-party sellers on Amazon. 

While their dominance might be attributed to their sales perseverance, understanding of the e-commerce landscape and baseline access to manufacturing, this group of sellers have been accused of leveraging manipulative and sometimes malicious tricks to stand out.

As they continue to dominate the Amazon marketplace, their manipulations raise concerns about transparency and fairness, especially for competing sellers on the platform who are playing by the books. 

Chinese Sellers on Amazon - Looking At The Numbers

The massive influx of Chinese sellers on Amazon is unprecedented. Recent reports suggest that nearly 63% of third-party sellers on the Amazon US platform come from mainland China or Hong Kong. While US Sellers make up 34.8%, Australian sellers account for only 0.82% of the seller pool.

In other words, of the estimated 1.5 million active third-party sellers on Amazon, around 1 million are Chinese sellers. 

Further analysis shows that Chinese sellers are dominating the top seller spots by country. Chinese sellers are at the forefront with a whopping 208 top spots, commanding an impressive 59.3%. In comparison, the United States has 112 top sellers, around 34.8%.

These lopsided dynamics highlight the challenges non-Chinese sellers face as they attempt to establish their presence. 

Why Are Chinese Sellers Dominating The Amazon Marketplace?

The continued dominance of Chinese sellers on Amazon tells a tale of strategic alignment. In Shenzhen, possibly home to a quarter of all Amazon third-party sellers, the Chinese government actively supports this hub for a specific reason: cross-border e-commerce. It's a lifeline for exports, a crucial need exacerbated by post-COVID export declines and a persistent trade war with the U.S.

Additionally, with Chinese-based e-commerce platforms like JD.com and Taobao thriving domestically, it's easy to see why Chinese entrepreneurs favor digital selling. Their unique experience and their country’s booming manufacturing industry position them to succeed everywhere they find themselves. 

From Amazon’s perspective, enabling a strong Chinese seller contingent allows them to offer competitive pricing to their customers. Because of their proximity to factories, Amazon believes Chinese sellers will deliver price bargains that may enhance customer loyalty. 

The symbiotic relationship between Amazon and Chinese sellers is obvious. Amazon wants cut-rate inventory, and Chinese sellers want access to Amazon’s extensive customer base. Therefore, this complementary relationship fuels the influx of Chinese sellers to the platform. 

The “Black Hat” Tactics Chinese Sellers Are Using to Game the System

As part of striving for dominance on Amazon there is the increasing use of malicious selling tactics particularly among many Chinese sellers.

While Amazon is working hard to put a stop to it, this use of black hat-selling tactics continues to exist.  

Although leveraging these tactics might help sellers get ahead in the short term, they jeopardize customers' trust in the Amazon marketplace in the long run. 

As an ethical seller looking to thrive in a highly competitive marketplace like Amazon, it's important you know these black hat tactics so you can manage them and their negative impact on your business.

Let’s see some of these black hat tactics that are used to circumvent the system. 

Using Fake Reviews to Mislead Buyers

One of the famous black hat tactics used on the Amazon platform is the use of fake reviews to boost product ratings. 

To these sellers using this tactic, reviews equal sales. And because positive customer reviews drive sales, many of these sellers pour in thousands of dollars to purchase fake reviews. 

While this tactic might deliver short-term results, it seriously undermines customers' experience and makes it harder for real customers to make informed purchases. 

These tactics often involve compensating genuine buyers to leave 5-star reviews or creating thousands of fake accounts to leave positive feedback.  

Although Amazon has put in place security measures to clamp down on these fraudulent strategies, the problem persists

Selling Counterfeit Goods

Another problematic selling tactic, particularly used by Chinese sellers is listing counterfeit products, which mimics the real thing. This deceives genuine buyers into believing they are purchasing authentic items, when, in fact, they are spending their hard-earned dollars on fakes.

While it translates to more money for these sellers, brand owners are on the receiving end as it damages their brand reputation and leads to loss of revenue. 

In its recent earnings reports, Amazon acknowledges its struggle in dealing with counterfeit listings, stating, “We also may be unable to prevent sellers in our stores or through other stores from selling unlawful, counterfeit, pirated, or stolen goods, selling goods in an unlawful or unethical manner, violating the proprietary rights of others, or otherwise violating our policies."

Although Amazon has rolled out different strategies for combating these trends, including the Transparency and Project Zero programs, sellers must also play their part in monitoring their listings and the broader marketplace for knockoffs.  

Sabotaging Competitors

Playing dirty against competitors is another problematic tactic. One insidious technique involves hijacking product listings to sow confusion and deter buyers.

Instead of promoting their own products, these sellers target rivals, infiltrating listings to plant damaging content. For example, they might switch out product photos to show incorrect items or slip in prohibited keywords related to drugs, adult materials, or hazardous substances. This triggers Amazon's compliance bots to remove listings.

To access and alter listings, black hat players exploit Amazon's open "community contribution" model where sellers can suggest edits, similar to a Wikipedia page. While well-intentioned for compiling accurate listings, this creates vulnerabilities.

Abusing Variations

Many Chinese sellers on Amazon engage in "variation abuse" to exploit the platform's review system. This black hat tactic involves adding completely unrelated products as new variations to existing listings with abundant positive ratings. 

For example, a seller might add a frying pan as a variation to a popular pressure cooker listing with thousands of reviews. This makes it appear their new frying pan already has all those glowing ratings since Amazon aggregates reviews across variations.

By piggybacking new items onto established listings, variation abusers can instantly borrow credibility and boost search rankings. This undercuts ethical sellers playing by the rules. It also misleads customers who assume all the reviews apply to the actual product they're buying.

Final Thoughts 

With Chinese sellers accounting for the majority of all sellers on Amazon, their dominance and tactics are hard to ignore. 

Behind their dominance is the symbiotic relationship they have with Amazon and the support these sellers receive from their government to excel in export trade. 

Chinese sellers are one of the largest offenders when it comes to the use of Black Hat tactics and it is the continued use of these tactics that will significantly impact long term customer experience and marketplace trust. Even though these practices provide short-term benefits, they degrade the integrity of the Amazon Marketplace. 

While Amazon has launched different strategies to combat these detrimental practices, much more must be done to rid the platform of these dubious sellers and it is up to us, as sellers, to be aware and vigilant to these practices.