Takeaways from Amazon’s pitch at its annual conference for third-party sellers

In recent years, it has become more common for Amazon leadership to frame sellers as customers, Jeff Cohen, Amazon Ads’s former principal evangelist, recently told Modern Retail. “In the early days, Jeff Bezos always saw the shopper as the primary customer, but there’s been a shift to recognize brands and sellers as customers, too,” he said. That shift is reflected in how Jassy has tried to run Amazon as “the world’s largest startup” — cutting bureaucracy, pushing for faster decision-making and leaning on technology to solve inefficiencies.

But Amazon’s track record shows how difficult that shift can be. Fee hikes, sudden policy changes and complex inventory rules have repeatedly sparked backlash, with merchants saying they feel squeezed by costs and stripped of control. Some sellers have become less loyal to Amazon, branching into platforms like TikTok Shop, Walmart and Shopify.

AI was the throughline of this year’s event, framed as the next step in that efficiency push. Jassy said Amazon aims to use technology “not because the technology is cool, but to solve a real customer problem,” and argued that sellers stand to benefit directly from AI-powered tools that help with inventory forecasting, solving compliance issues and more. Some of those tools are seeing strong adoption. According to Amazon, 1.3 million third-party sellers have used its AI-powered listing tools, which can generate approximately 70% of the content that forms a product listing on its e-commerce platform.

But it remains to be seen whether other tools, like Amazon’s upgraded seller-facing chatbot, will see as much adoption. For some sellers, new AI tools may seem less like solutions to everyday problems and more like Amazon’s latest attempt to dazzle with technology.

Below are the top three takeaways from this year’s Accelerate.

1. AI, AI, AI

Amazon is pitching its merchants on the latest uses of AI, from advertising to inventory management to market research. Amazon even built a pinball-style arcade game, where convention attendees could create campaigns through conversational prompts, to promote its new AI-powered ad tool.

But the pièce de résistance was a revamped version of its merchant-facing chatbot, which was introduced last year under the codename Project Amelia. While the first version only answered questions, the latest iteration, dubbed Seller Assistant, has been rebuilt to be more proactive. It can flag compliance problems, forecast demand and manage inventory to avoid storage fees.

One demo showed how the assistant could automatically reframe a product description to avoid regulatory trouble. A tent listing that originally claimed it “eliminated mosquitoes” — language that would have triggered pesticide regulations — was rewritten by the tool to simply promise it would “keep bugs out.” That small but meaningful shift, Amazon said, could prevent compliance violations and lost sales.

Like other tech giants, Amazon has invested heavily in AI, pouring more than $100 billion on data centers to power the technology.

Amazon has been tracking usage of the tool, but has not released any adoption or performance data a year after launch. Mary Beth Westmoreland, the vp of worldwide selling partner experience at Amazon, said the company looks at whether sellers return to use the assistant, if they act on recommendations and whether they report finding the tool valuable. “We have not specifically measured gross merchandise sales drivers at this point, but that’s our plan,” she told Modern Retail in an interview.

Max Sinclair, a former Amazon employee and founder of Azoma, an agency that helps brands and sellers show up in AI-driven search like ChatGPT and Amazon’s consumer-facing chatbot Rufus, said last year’s iteration of Seller Assistant saw low adoption among his client base. Azoma has around 100 total customers, including 40 independent sellers and 60 enterprise clients, such as David Protein and HP. He said the low adoption among his client base was in part because the Q&A format was “too basic” for experienced sellers who already know the answers to questions like, “How do I list a product?” and “How do I inbound my inventory?”

Despite all the hoopla around AI, it was another announcement — the end of an obscure fulfillment practice known as commingling — that drew the loudest round of applause from the thousands of sellers that gathered in Seattle to hear about the e-commerce giant’s latest product news. To Sinclair, the dissonance highlighted the gap between Amazon’s push to dazzle with new technology and merchants’ desire for fixes to long-standing pain points.

“One of the massive benefits [of Accelerate] for Amazon is just putting this on and getting their product managers on the floor to hear feedback directly,” he said.

2. Amazon is pulling services in-house

Another theme running through Accelerate was Amazon’s push to internalize functions that third-party vendors and consultants already provide, including compliance services, ad optimization and account management.

“It felt like Amazon’s identified that one way they can give us more margin is by reducing how many third-party services we’re using,” said Michael White, founder of Leroy’s Rocky Mountain, which sells beef tallow. “Lots of their announcements made it so that if you are a small brand, you don’t have to rely as much on vendors or agencies or service providers. And that’s how they’re giving us more margin.”

Sellers need that. Many online merchants import goods from heavily tariffed countries like China. In recent years, sellers have also felt increasingly squeezed by platform fees on Amazon.

Amazon showcased an AI-powered advertising tool that can generate storyboards, videos and campaign assets automatically. “No more costly shoots, no more endless coordination, no more waiting weeks for content production,” Jay Richman, vp of product and technology, said during a live presentation to sellers.

That may have ripple effects. Many agencies and service providers built businesses around managing Amazon compliance cases, optimizing ad campaigns or generating enhanced listings. With Amazon now offering those services directly, often at no charge, those businesses could face margin pressure or obsolescence. Modern Retail previously reported how consultants that help merchants grow on marketplaces like Amazon are experiencing slowing inquiries and shrinking service contracts as brands pull back on spending because of tariffs.

Asked how AI could affect human jobs, Westmoreland said AI is intended to support sellers with better tools and capabilities. “Our goal is to provide sellers with capabilities to help them better run their business,” she said.

In June, Jassy told employees that AI adoption would lead to future workforce reductions at the company.

3. Amazon bets efficiency upgrades will spark seller innovation

At Accelerate, Amazon pledged to lower the barriers for both emerging and established sellers when it comes to product innovation.

Westmoreland described the challenge facing sellers in three parts: gauging whether customers will love a product, managing upfront capital investment and securing reviews. “We want selling partners to always come to Amazon when they want to launch,” she said. “We just want to make it a lot less risky and a lot more simple”

As such, Amazon rolled out new tools meant to ease the cost of launching new products. These include using AI to spot new product opportunities, regionalized FBA that aims to trim upfront shipping costs and collecting customer feedback faster.

The new features come at a time when selling on Amazon has only gotten tougher. According to Marketplace Pulse, the number of active sellers has fallen from more than 2.4 million in 2021 to under 1.9 million this year, even as Amazon continues to attract nearly a million new sign-ups annually. That contraction means there’s now 31% more traffic per seller than four years ago, but it also reflects the difficulty of staying active in a marketplace where Amazon’s fees eat up more than half of many merchants’ revenue.

Chinese merchants now account for more than half of the top sellers on Amazon in the U.S., per Marketplace Pulse, intensifying price competition as factories sell directly to consumers. Brands have previously told Modern Retail that President Donald Trump’s tariffs are hindering new product development. Against that backdrop, Amazon’s pitch is that its in-house AI can help smaller businesses offset these pressures by lowering marketing and operational costs.

White, who launched his Amazon business six weeks ago, said the new tools, as well as Amazon’s decision to bring more services in-house, stand to benefit new brands like his. “It’s the first time in a while that I’ve felt like Amazon’s going out of their way to make life better for the small seller,” he said.