FTC and 22 States Unseal Amazon Ads Complaint Alleging Secret Markups of Up to 50%, and 250% on Big Shopping Days
The Federal Trade Commission (FTC) said on November 5 that the FTC and attorneys general of 22 states recently filed an updated version of their complaint against Amazon, making public previously redacted details alleging that Amazon used deceptive and unfair practices to secretly inflate prices in its online search advertising auction. The FTC and its state partners sued Amazon in August in the U.S. District Court for the Western District of Washington.
The unredacted portions of the complaint allege that Amazon secretly raises advertising prices by as much as 50 percent above auction results on ordinary days and by as much as 250 percent on major shopping days such as Prime Day or Black Friday. During the 2021 holiday season, the complaint alleges, Amazon increased advertisers' average cost-per-click by 20 percent, with some advertisers experiencing increases of over 200 percent; during the 2022 holiday season, Amazon's secret surcharges increased its revenue by $87 million worldwide.
Neither small businesses nor large, sophisticated customers were spared, the complaint alleges: one large food and beverage advertiser was subjected to price increases of more than 100 percent during Prime Day in 2023, and Amazon internally acknowledged that its increases had driven down the advertiser's return on ad spend in a way that was "destroying campaign performance."
The unsealed allegations also say Amazon used its hidden surcharges to meet corporate financial targets. In 2023, according to the complaint, Amazon executives discussed needing an additional $40 million in revenue, and the head of Amazon Ads emailed the senior vice president of ad products and technology that he wanted to "pull out all of the stops (without doing unnatural acts) to close our gaps to plan," adding that reserves of "ideally at least $40MM would be helpful."
When advertisers asked whether "something has changed with respect to the second price auction process," the complaint alleges, Amazon falsely reassured them. In one instance, after being asked directly whether the process had changed "either by design or mistake," an Amazon account manager replied that the product specialist team had confirmed "there is not a bug, or a change in auction style," and attributed the spike in costs-per-click to a marketplace "even more crowded than any year previous."
The 22 states joining the filing are Alaska, Arizona, California, Colorado, Florida, Idaho, Illinois, Indiana, Iowa, Kentucky, Louisiana, Maryland, Nebraska, New Jersey, New York, North Carolina, Oklahoma, Pennsylvania, Rhode Island, South Carolina, Vermont and Washington. The claims above are allegations in the complaint and remain to be decided by the court; the FTC's announcement did not include a response from Amazon.
(Source: Federal Trade Commission)
Source: Federal Trade Commission
Published by GSM · USA (original Chinese edition)
Photo: 图：位于华盛顿的美国联邦贸易委员会总部Apex大楼（2025年2月摄）。G. Edward Johnson 摄，CC BY，经 Wikimedia Commons。 / Photo: The Apex Building, headquarters of the Federal Trade Commission in Washington, D.C. (February 2025). Photo by G. Edward Johnson, CC BY, via Wikimedia Commons.
