WASHINGTON – The Federal Trade Commission and 22 state attorneys general unsealed new details in a lawsuit against Amazon, alleging the company secretly inflated online advertising prices by adding surcharges to auction results.
The updated complaint, filed in the Western District of Washington, claims Amazon increased advertising costs by as much as 50 percent above auction results on typical days and up to 250 percent during major shopping events such as Prime Day and Black Friday.
These alleged surcharges, reportedly implemented between 2021 and 2023, affected both small businesses and large advertisers utilizing Amazon’s platform, according to the FTC.
The commission stated that Amazon’s hidden surcharges were linked to internal revenue objectives, with executives reportedly discussing the need for an additional $40 million in 2023 from these practices.
The lawsuit further alleges that Amazon account managers provided misleading responses to advertisers who questioned sharp increases in their cost-per-click (CPC) rates.
Amazon has denied deceiving or harming advertisers, stating that its reserve pricing ensures advertisers never pay more than their maximum bid.
The company maintains that its advertising services provide value to businesses seeking to reach customers on its e-commerce platform.
The FTC’s complaint seeks to halt Amazon’s alleged anti-competitive practices and restore competition in the online marketplace.
Source: Search Engine Journal
