Marketplace Briefing: Some Amazon sellers skip Black Friday deals as tariffs and platform fees bite

Amazon sellers are hesitant to commit to deep holiday markdowns because of President Donald Trump’s trade war, which has slapped steep tariffs on a range of imported goods from top trading partners, eroding brands’ profit margins. The rising cost of doing business on Amazon is also making it increasingly difficult for sellers to offer heavy discounts.

Spreetail, an e-commerce accelerator that works with around 120 brands across a range of categories, said participation in Amazon’s holiday sale is down sharply, with 60% fewer sellers offering discounts compared to last year. Tariffs are top of mind, according to Amit Dodeja, Spreetail’s CMO.

“The biggest change that’s happened this year, relative to any other year, has been tariffs,” he said. “Therefore, you’re going to be a lot more thoughtful about participating in deal events because you’re giving up margin there, or you might not even have the margin to support deals.”

Liz LaVallee, COO of Avenue7Media, a consulting business that helps sellers grow on online marketplaces like Amazon, has observed a similar pullback. Premium labels often sit out discount events, she said. But this year, even historically promotional brands are pulling back as tariff-driven manufacturing costs rise. “Their margins are getting pinched pretty tightly,” she said.

Like for most retailers, Black Friday and Cyber Monday are Amazon’s biggest shopping days of the year. Last year, the company said its Black Friday and Cyber Monday events were its “biggest ever,” compared to prior years. Over a billion items were purchased during the 11-day holiday sale in 2023, according to Amazon. The events also help bolster Prime memberships, which cost $139 annually; Amazon has around 200 million Prime subscribers worldwide, according to Consumer Intelligence Research Partners, which has tracked Prime memberships for a decade.

U.S. shoppers spent a record $241.4 billion online during the 2024 holiday season, according to Adobe Analytics. This was an 8.7% increase from the previous year. But growth is expected to slow in 2025; Adobe forecasts $253.4 billion in online spending this holiday season, a 5.3% year-over-year increase.

The timing of Amazon sellers’ holiday pullback may prove risky, as merchants could lose deal-hungry shoppers. A survey from Deloitte shows U.S. shoppers, on average, expect to spend $1,595 this holiday season, down 10% from 2024. Seventy-seven percent of respondents expect higher prices on holiday items.

“There is a real tension between the consumers who are hunting for deals and have been holding out for the biggest discounts that they’re expecting during this holiday period, and the brands and sellers that just can’t make the math add up without losing a lot of money,” said Sky Canaves, a retail analyst at eMarketer. 

A softer showing from merchants matters for Amazon itself, as third-party sellers accounted for around 62% of goods Amazon sold in the fourth quarter of 2024, according to e-commerce intelligence company Marketplace Pulse. But the burden of tariffs and any slowdown in consumer spending will fall most heavily on smaller sellers, Canaves said. Indeed, the steepest discounts Amazon is touting in its holiday press release come from major brands like Shark, Bose and Ninja, offering deals as much as 55% off.

“Amazon will not be losing out, because it has so many sellers and brands, it will just gain on the sheer volume,” she said. “For the smaller brands and sellers, they just don’t have as much leeway to absorb rising costs from tariffs.”

“We’re pleased by the strong response from our millions of selling partners for this year’s Black Friday Week and Cyber Monday deal events and look forward to bringing customers discounts across a vast selection of products,” an Amazon spokesperson told Modern Retail in a statement. “We’re working with our broad, varied range of valued selling partners in our store to support them in adapting to the evolving environment while maintaining low prices and great selection for customers.” 

Deals lose their luster

Chuck Gregorich, CEO and founder of outdoor goods brand Net Health Shops, said he’ll offer “little to no discounts” on seasonal bestsellers — including $189 artificial Christmas trees, $159 fire pits and $135 nutcrackers — despite discounting those products by roughly 20% last year. Gregorich previously manufactured all his goods in China, but after Trump imposed tariffs that spiked as high as 145%, he moved much of his sourcing to India. Additional tariffs of 50% on Indian imports have once again pressured costs, he said.

Like many Amazon sellers, Gregorich raised prices earlier in the year to mitigate the impact of tariffs, hiking prices by an average of 9% across his entire catalog. But he expects another round of increases in January — not only to offset higher manufacturing costs, but also Amazon’s 15% commission on each sale. That figure doesn’t include marketplace advertising fees or the cost of participating in high-traffic sales events. For instance, sellers pay Amazon $1,000 for a “Best Deal” placement or $500 for a “Lightning Deal.”

The deadline for submitting “Best Deals” and “Lightning Deals” for Amazon’s holiday sale already passed on Oct. 28, according to LaVallee. But online merchants can still set up “Prime Exclusive Discounts,” even after the event has started, if some sellers change their minds about participation. Earlier this year, Amazon doubled the cost of “Prime Exclusive Discounts,” Modern Retail previously reported.

Rick Sliter, CEO of MedCline, which sells medical-grade pillows for acid reflux and shoulder pain made in China and Vietnam, said he’s offering a 20% off discount for the holidays, down from 25-30% in prior years, even though the fourth quarter is “by far” his biggest sales period, “nearly double” other quarters. But he has to protect his margins, which have slipped by about 7% this year because of tariffs, he said.

Sliter experimented with price hikes earlier this year but saw a drop in profit per visitor, so he’s holding off for now. Still, he expects to raise prices again in early 2026, calling higher prices “inevitable.”

Adam Wilkens, founder of the Amazon consultancy Dotcom Reps, which advises about 30 clients, said brands typically need to meet a discount threshold of around 20% to secure Amazon’s deal-event badge, which helps sellers stand out during peak periods. That’s “hard to swing for people importing from China, unless the cost of goods is really cheap relative to the item price,” he said.

As much as 70% of goods on Amazon come from China, according to estimates from Wedbush Securities. Today, Chinese imports face a combined duty rate of up to 55%, including a 25% Section 301 tariff on industrial imports, Trump’s 20% fentanyl tariff on board categories and a 10% reciprocal tariff.

“Deals have lost luster for many,” said Wilkens, not only because of tariffs, but also “because of the constant fees by Amazon.” Last month, Amazon announced it was increasing fulfillment fees for merchants in 2026, even though Trump’s tariffs have squeezed sellers’ margins. In lieu of discounting, Wilkens said some sellers are increasing their ad spend to drive traffic to their listings.

First-party merchants on Amazon — those who sell inventory wholesale directly to the platform — are also feeling growing pressure to cut back on promotions. Jimmy Zollo, the co-founder of adaptive clothing brand Joe & Bella, which makes all of its goods in China, said he plans to reduce his typical holiday discount on Amazon by about 10 percentage points year over year. Discounts will also focus only on SKUs with excess inventory, not top sellers.

Some brands are managing to hold the line, despite tariffs. Red light therapy brand Helight is offering 30% off its sleep products for the full duration of Amazon’s holiday sale, consistent with last year. The skin-care brand Borghese also plans to offer 30% off its entire assortment on Amazon.

Monil Kothari, the founder and CEO of the jewelry brand Haus of Brilliance, said his best sellers have risen 15-25% in price this year, thanks to tariffs on Indian imports. As such, deeper promotions no longer make financial sense. Kothari is aiming for “the lowest discount possible,” of 5-15% — a far cry from the 25%-plus deals he used to offer. He’s hoping those discounting levels will be enough to attract price-conscious holiday shoppers. Black Friday alone accounts for 6% of the company’s annual revenue. But the following weeks will be just as critical.

“Black Friday and Cyber Monday, for us, is just the beginning,” Kothari said. “On average, during the last two weeks leading up to Christmas, every day tends to be a Black Friday and Cyber Monday, in terms of sales volume, if not more.”

What I’m reading

• Amazon raised $15 billion in its first U.S. dollar bond offering in three years to fund artificial-intelligence infrastructure, per Bloomberg.
• With $19 billion in third-quarter GMV, TikTok Shop is now almost as large as eBay, which reported $20.1 billion for the same period, according to Wired.
• Amazon founder Jeff Bezos will return to an operational role as co-CEO of a new artificial intelligence startup that focuses on AI for engineering and manufacturing, the New York Times reported.
  

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