Google, Bing & Amazon’s 2024 Shopping Ad Changes & How To Navigate Them

Google, Bing & Amazon’s 2024 Shopping Ad Changes & How To Navigate Them

The ecommerce industry is undergoing significant transformations, driven by the rapid advance of AI.

Ecommerce brands are often challenged to stay abreast of critical changes in the marketplace, such as merchant center upgrades and the recent changes in shopping ad displays on Google, Bing, and Amazon.

While it can be difficult for businesses managing extensive product inventories to keep up, it’s essential.

Let us help.

In this series of articles, we wanted to tackle many of the changes we’ve seen in the ecommerce space, particularly changes in shopping ads.

These developments represent a significant and lasting transformation in how e-commerce operates. The earlier you adapt your ecommerce strategy to leverage advances in this sector, the greater your competitive advantage.

We highly recommend reading “Everything You Need to Know About Google Merchant Center Next.” You’ll get the insights you need to harness the power of its new capabilities, so you can leverage them for success.

Read on to find out more about how these platforms are changing so you can take your shopping ads to the next level.

Until next time!

Katie Morton
Katie Morton Editor in Chief, Search Engine Journal

How Google Blends Search, Social, Local, Shopping, AI, And Ads

Explore how Google Search and Discover integrate results with social features, news, forums, videos, shopping, local, generative AI, and ads for an engaging user experience.

Kristi Hines Kristi Hines 5.7K Reads
How Google Blends Search, Social, Local, Shopping, AI, And Ads

Google’s continued evolution of Search and Discover with new features demonstrates its commitment to adapting to shifting consumer needs, interests, and trends.

By improving its search results with a personalized feed, social posts, discussions, stories, and generative AI, Google creates new opportunities for marketers and advertisers to reach target audiences.

This article will explore Google’s growing integration of engaging social and conversational features into Search and the Discover feed.

Mobile Users Want More Social Features

Why would Google begin to integrate social media features into its search results?

We know Google maintains its position as the most used search engine globally.

search engine market share november 2023Screenshot from Statcounter, December 2023

Amongst the top search engines, it also leads with the most engaged users.

google baidu yandex bing duckduckgo traffic engagement december 2023Screenshot from Similarweb, January 2024

One thing to note from the above data: over half (59%) of visitors were on mobile devices.

This is not surprising, considering that the number of people who access the internet is increasing on mobile phones, connected television, and smart home devices.

desktop browser usage decreasingScreenshot from DataReportal, December 2023

As for the types of apps and websites people visit, social networks outrank search engines.

Screenshot from DataReportal, December 2023

If you compare the engagement data for Google search to the top social media platforms, you’ll find that social networks keep visitors more engaged. Social networks also offer more ad formats for advertisers to utilize for brand marketing.

google youtube facebook instagram tiktok traffic engagement december 2023Screenshot from Similarweb, January 2024

In addition to the growing demand for social features, there is also an increasing interest in AI-powered search, according to a survey of 2,205 adults in the United States.

ai-powered search interestScreenshot from Statista, January 2024


Google has already expressed its plans to experiment with ads in its Search Generative Experience (SGE), something that Bing has already incorporated into its AI copilot for search.

bing generative ai search adsScreenshot from Bing, January 2024

Hence, it should be no surprise that Google is adding or experimenting with more social and generative AI features for search, making it easier for users to tap into more sources for research and to make purchasing decisions.

It should also make it easier for Google to capture engagement information from users for first-party advertising data after third-party cookies are depreciated.

The following are examples of the newest features in Google Search and Discover. Some features are only available in some locations and for mobile users with an Android smartphone or the Google app for iOS.

Mobile examples shown below are from the Google iPhone app using a Google account in the U.S. with access to the latest experiments in Search Labs.

A Personalized Google Discover Feed

When you open the Google app, below the search bar, you’ll find your personalized Google Discover feed. It includes many of the features you would expect to see on other social newsfeeds, including recent headlines, videos, trending topics, and information about topics users follow.

While scrolling through the feed to catch up on the latest headlines, users will find ads from Discovery campaigns, which will soon be under the Demand Gen for Google advertisers.

google discover feed discovery campaigns demand gen adsScreenshot from Google, January 2024

Web Stories With Ads

While top social networks like Facebook, Instagram, and TikTok place stories above the newsfeed, Google integrates web stories throughout the Discover feed.

Google’s version of stories will continue to play new, related stories, much like Instagram and other social networks do, keeping the user in the Google app longer to show more ads.

google ads in web storiesScreenshot from Google, December 2023

Shopping Results In The Discover Feed

While most of the products featured below are not part of an ad campaign, the listings demonstrate how easily Google could place shopping ads within the Discover feed. It even pulls products mentioned from articles directly into the Discover feed.

google discover shopping results adsScreenshot from Google, January 2024

Social Media Videos & YouTube Shorts

YouTube videos and Shorts appear in the Discover feed. Those that automatically begin playing within the Discover feed offer the opportunity for pre-roll, post-roll, skippable, and non-skippable ad formats.

google discover feed youtube shortsScreenshot from Google, December 2023

Videos from other websites and social networks like Facebook and TikTok also appear in the Discover feed but do not autoplay.

Notes With AI-Generated Images In SERPs

Along with SGE, mobile users on Android devices or using the Google iOS app with access to Google Search Labs can try Notes. The experimental feature allows users to leave comments in SERPs.

google notes comments in serpsScreenshot from Google, January 2024

Similar to blog comments or third-party reviews, you will find Notes with commentary from promoters, detractors, and those who hope to get visibility from their responses on a popular page.

google notes promoters fans detractors complaints spamScreenshot from Google, January 2024

But unlike the comments on your blog or your social profile, you don’t have the option to turn Notes off. This makes it another place brands have to monitor for reputation management.

It also could be the future home of Notes ads, sponsored by competitors on search results about your brand.

For now, users with access to this feature can add stickers, gifs, and AI-generated images made with Google AI to Notes.

how to add google note stickers gifs ai image generatorScreenshot from Google, January 2024

To find Notes in SERPs for your website, search for your domain using keyword.

google notes site search for reputation management commentsScreenshot from Google, January 2024

Some websites may not be eligible to receive Notes based on safety and sensitivity signals:

Google uses signals like the search term, text on the web page, and other links to the website to determine whether notes are helpful. If a topic is deemed potentially unsafe or sensitive, results may also be ineligible for notes.

Some users may not be eligible to post Notes:

You may be ineligible to post notes if your account has been blocked due to previous violations of Google’s policies for user content on Search. Users who are underage or with accounts outside of the US or India are not eligible to post notes at this time. Additionally, if you are using an enterprise Google account, you will need to switch to a personal account to use Notes.

Google Profiles With Social Links

When you create a Note, it will appear on your Google profile. You can edit your profile to include one or more links to other social profiles.

You will also receive notifications when your note receives views.

google profiles social links notes notificationsScreenshot from Google, January 2024

Likes, Saves, And Shares

Another social feature available for Google Search users on mobile devices is the ability to Like, Save, and Share search results in the Discover feed. This includes news, ads, stories, and Shorts.

google discover like save share followScreenshot from Google, January 2024

When you like, save, or follow something in Google Search or the Discover feed, it will be saved to your Google account.

google save share search resultsScreenshot from Google, January 2024

This collection of saved items also includes links to articles, images, recipes, web stories, YouTube, pinned places on Maps, and Notes.

google interests saved listsScreenshot from Google, January 2024

You can create new collections and save new links to your account on desktop or mobile.

google new collection add link blank templateScreenshot from Google, January 2024

Collections and saved items appear to be private. This feature feels reminiscent of social bookmarking networks like Delicious (now an AI tool) and Diigo (still active), which helped users “never lose a link.”

Likes, saves, shares, and Notes could become social signals for ranking in the Discover feed, similar to how the top social networks include these engagement signals in algorithms to rank items in each user’s newsfeed.

These engagement signals could offer new ways for marketers to track engagement with search results if introduced to Google Analytics or Search Console metrics.

It could even become a source for new remarketing audiences, allowing advertisers to reach those who have liked, shared, saved, or commented on search results about the brand with Notes.

Even Meta, known for ad targeting based on user interactions, just added link history tracking for Facebook users.

When link history is on, any links you’ve tapped inside of Facebook and visited in Facebook’s Mobile Browser will be saved here for 30 days.

Keep in mind that when link history is on, we may use this link history information from our browser to improve your ads across Meta technologies.

facebook link history tracking for adsScreenshot from Facebook, January 2024

Follow This Search

You can follow searches for keywords, brands, products, and topics with a button that appears at the end of search results on mobile. Searches you have recently followed will appear near the top of your Discover feed.

google follow this search discover feed Screenshot from Google, January 2024

The Google Discover feed will also recommend topics to follow based on your interests and activity.

SGE While Browsing Offers More Search Results

SGE while browsing, an experiment alongside SGE in Google Labs for mobile users, offers summaries, information about the page, and more search results while you are browsing a website.

The mini-SERP for this article includes a FAQ-like Explore more section, People also view, links about the source of the information, and information about the featured image on the page.

google sge while browsingScreenshot from Google, January 2024

SGE while browsing allows users who click on ads from the Discover feed to learn more about the company before submitting a lead form.

The mini-SERP for this landing page includes information about the company, the image in the ad, and more videos about the company from Facebook and YouTube.

google sge while browsing on google ads landing pageScreenshot from Google, January 2024

SGE while browsing offers users reviews from the web for tools like Google Bard and Semrush.

google sge while browsing reviews from webScreenshot from Google, January 2024

For ecommerce shoppers, SGE while browsing gives you the option to track a product (added to your Saved lists), learn more about the company, and view more reviews on blogs and videos.

google sge while browsing product tracking amazonScreenshot from Google, January 2024

Local Search, SGE, And Social Posts

Local search results include a combination of the typical local pack search results, generative AI, and links to social networks, videos, and discussion forums.

google local search results sge social discussion forumsScreenshot from Google, January 2024

Mobile search users can find Perspectives, events, deals, and recent posts from local businesses in local search results beneath SGE. They can also follow the search, which will lead to more local results in the Discover feed.

google local search social discussionsScreenshot from Google, January 2024

This adds another level of social-local integration to the Google Search experience, complementary to Google Maps’ newsfeed and social features.

google maps newsfeedScreenshot from Google Maps, January 2024

Perspectives In Search

Google search users on desktop and mobile browsers can find Perspectives. This search filter features results from blogs, news sites, and platforms like Instagram, Medium, Reddit, StackOverflow, TikTok, and YouTube.

google perspectives search filter desktopScreenshot from Google, January 2024

Perspectives are not limited to third parties, as some also include forum posts and YouTube videos from brand channels.

This means that SEO should not be limited to pages on your website but also applied to forums, social profiles, company pages, and the individual posts made on each for discoverability.

It’s also interesting to note that while posts from X/Twitter appear prominently in Google Search results, but not under the Perspectives filter.

google perspectives branded social profiles forum postsScreenshot from Google, January 2024

Discussions And Forums In SERPs

Another area Reddit appears in SERPs is Discussions and forums. It adds another level of conversation and perspective to search results.

google serps discussions forumsScreenshot from Google, January 2024

User Feedback For Discover Results

How do users feel about items in the Discover feed? Google often prompts users to offer feedback about ads, stories, news items, and YouTube videos that appear in the Discover feed.

google discover feedback is this a good recommendation for you ads stories videos newsScreenshot from Google, January 2024

The sentiment offered by search users on these quick surveys may impact the content’s visibility in the Discover feed, helping improve user experience.


Google’s integration of search, social posts, shopping, video content, local results AI, and ads represents a shift that marketers must adapt to by embracing omnichannel marketing strategies.

This includes optimizing content for a mobile-first audience, engaging actively on social media and with social features in Search results.

To stay competitive, marketers should continuously monitor these evolving trends and integrate them into their digital strategy to continue reaching and engaging with target audiences.

Featured image: Nuttapong punna/Shutterstock

Everything you need to know about Google Merchant Center Next

Google Merchant Center Next is the upcoming update to Google Merchant Center that’s designed to make it easier for businesses to manage their product data and improve their visibility on Google Shopping. The update is expected to be released in the first half of 2024.

Channable Channable 2.1K Reads
Everything you need to know about Google Merchant Center Next

In this guide, we’ll cover everything you need to know about the update, give you a quick refresher on Google Merchant Center, and explain how Channable can help you optimize your product feed.

What is Google Merchant Center Next?

Google Merchant Center Next is a simplified version of Google Merchant Center, giving you more control over how your products appear on Google, without the hassle of manually uploading a feed.

For instance, Merchant Center Next will be able to automatically extract product data, including product titles, descriptions, sizes, prices, and images, directly from your website and populate it on Merchant Center Next.

Merchant Center Next has already started rolling out for new users, and Google plans to complete the global rollout in 2024.

Need a quick refresher on Google Merchant Center? Don’t worry, we’ve got you covered.

What is Google Merchant Center?

Google Merchant Center is a free platform that helps online businesses get their products listed on a number of Google platforms.

When you create a Merchant Center account, you upload a product feed, which is a file that contains detailed information about your products, such as their name, description, price, and images.

Google then uses this information to display your products in relevant places, such as Google Search, Google Shopping, and Google Maps.

Retailers can also use their Google Merchant Center feed to create Shopping or Performance Max campaigns to promote their online or local product inventory. Shopping ads show users a photo of your product, title, price, reviews, and brand name, using the information in your product feed.

Performance Max campaigns include auto-generated ads based on assets provided by the advertisers and in the Merchant Center feed.

Unlike Shopping ads, Performance Max campaigns can be used in a wide range of Google Ads formats such as Display Ads, Text Ads, and YouTube Ads.

Wondering if Performance Max campaigns are right for your business? Check out our ultimate guide to creating a Performance Max campaign.

Google Merchant Center vs. Merchant Center Next

The main difference between the old Google Merchant Center and Merchant Center Next is that you’ll no longer need to manually upload a product feed to Google.

Google Merchant Center Next automatically detects product data from your website and pulls it into the platform. If you prefer to have more control over your product feed, you’ll still be able to edit the products or turn off the feature completely.

Here are some other key differences between the two platforms:

Simplified user interface

Google Merchant Center Next provides a more simplified user experience that’s designed to be more user-friendly, especially for merchants with smaller businesses.

The products section has a cleaner design and overview, making it easier for merchants to see if a product has been approved, its price and availability, and its click potential.

Edit products directly in platform

Perhaps one of the biggest quality-of-life upgrades is the fact that you can directly edit products in the Merchant Center Next dashboard.

This means that you’ll no longer have to update and re-sync the product feed to make changes. When you click the “Edit product” button, you can change attributes such as product title, description, final URL, etc.

Concise product diagnostics

Merchant Center Next has a slimmed-down diagnostics feature that provides information about product errors and issues, including what’s approved, under review, limited, and not approved.

While the simplified diagnostics feature offers a concise overview of product status, it lacks the historical timeline and detailed information provided by the previous version of Google Merchant Center.

Better performance insights

Merchant Center Next brings all insights reports into the Performance tab, making it easier for merchants to access and understand their performance. The following tabs are included in this new streamlined view:

  • Overview
  • Products (existed previously)
  • Competitive visibility
  • Pricing
  • Demand
  • Store on Search and Maps
  • Non-product website results

With this update, merchants have one central location to review their best-selling products, see which brands show up for the same searches, and even monitor how shoppers are engaging with their brick-and-mortar stores on Search and Maps.

Integration with Product Studio

Google’s Product Studio tool, which helps merchants create unique product imagery using generative AI, can also be directly accessed from Merchant Center Next.

Product Studio enables merchants to add custom backgrounds and scenes, remove distracting backgrounds, and increase the resolution of low-quality images.

‘Click potential’ metric

There’s a new metric in Merchant Center Next called ‘Click potential’, which calculates the likelihood of shoppers clicking on your ads based on past traffic, product data, and demand.

This metric helps merchants identify which products need fixing, and shows you how well each product is meeting its goals. The values for ‘Click potential’ are as follows:

  • High: Potential to receive a similar number of clicks as your highest-performing products
  • Medium: Potential to receive a moderate number of clicks compared to your highest-performing products
  • Low: Potential to receive a low number of clicks compared to your highest-performing products

Streamline feed optimization on Google Merchant Center Next with Channable

Whether you’re just starting out or have been running ads for a while, you’ll need to use Google Merchant Center to utilize product listing ads on Google’s network.

And while Merchant Center Next offers several user-friendly enhancements and simplifies product uploading for smaller businesses, larger eCommerce brands may still benefit from a dedicated feed management tool.

Here’s how a feed management tool like Channable can empower you to streamline the entire feed optimization process:

Relevant product data

Storing product info in your Google Merchant Center is essential for running Google Shopping ads. But getting it in the right format can be tricky, especially if your source data formats differ.

For instance, the format of your product titles or product attributes like colors and materials might vary from Google’s requirements. Channable’s Google Shopping API and feed connection make it easy to format your data correctly and deliver all the mandatory fields to Google. Plus, our rule system filters out irrelevant products and outdated info, keeping your feed up-to-date and accurate.

Smart categorization

Even though you can edit product data directly in Merchant Center Next, you can only do it on a product-by-product basis. As a result, formatting your product feed to meet the requirements of Google Merchant Center can be extremely time-consuming.

Channable’s built-in smart categorization lets you categorize your products in only a few minutes with the help of AI, reducing the time you would usually spend optimizing your Google product feed.

Performance-based campaign optimization

Thanks to our Google Shopping API, you can see how all your products listed on Merchant Center Next are performing in Google Shopping or Performance Max ad campaigns, directly in the Channable dashboard.

You can get real-time insights on key metrics such as click-through rate and conversion rate, allowing you to make data-driven decisions to optimize your campaign performance, such as boosting top sellers or creating more visibility for low-performing items.

Microsoft AI Takes Retail Shopping To The Next Level

Microsoft unveils new AI tools to bring retailers into the digital age.

Matt G. Southern Matt G. Southern 1.8K Reads
Microsoft AI Takes Retail Shopping To The Next Level

Microsoft has unveiled new AI and data tools to bring retailers into the modern digital age.

The new offerings expand Microsoft’s existing retail industry cloud platform. They use Copilot, Microsoft’s latest AI helper that uses generative models like the advanced GPT-4 system to enhance productivity.

Personalization Through Microsoft AI

Microsoft has added Copilot templates to its Cloud for Retail platform, integrating OpenAI’s generative AI capabilities into Azure.

These new tools are intended to help retailers provide more customized and personal shopping experiences for their customers, similar to having a dedicated personal shopper.

The goal is to meet the expectations of today’s consumers, who increasingly want personalized interactions when shopping online or in stores.

By providing tailored product recommendations and offers, retailers can encourage shoppers to add more items to their carts.

The Copilot templates leverage generative AI to dynamically generate unique content for each customer, helping retailers build stronger relationships and boost sales through more personalized shopping journeys.

Support for Retail Associates

Microsoft is previewing new tools to help retail workers be more productive.

The tools are designed to help sales associates and other store staff quickly access information while helping customers. One example is an AI assistant that lets workers ask questions in natural conversational language on their mobile devices and get relevant data.

Microsoft says it’s developing these AI retail tools because there’s demand from retail employees for more digital technologies that can streamline their daily workflows.

Data Insights With Microsoft Fabric

Microsoft is tackling the problem of scattered and inconsistent retail data by providing new tools within its Microsoft Fabric platform.

This includes a standard data structure for the retail industry, a way to connect e-commerce systems, and pre-made templates for analytics like figuring out what items customers often buy together.

The idea is to help retailers and brands unite their data sources and gain insights from AI more easily.

Enhancements To Marketing with Generative AI

Microsoft is integrating its Copilot AI into Dynamics 365 Customer Insights, its marketing analytics platform, to assist with campaign creation. The AI can help generate project ideas and recommend content for campaigns.

Microsoft launched a new Creative Studio feature in its Retail Media advertising platform that utilizes AI. This tool helps retail advertisers quickly create and customize banner ads to improve campaign results and target ads to specific audiences.


With Microsoft’s new technologies, stores can improve customer shopping experiences, make retail jobs easier for workers, and harness data to help executives make important choices.

A study done for Microsoft shows that retail companies are seeing major benefits from using AI, highlighting how vital these technologies are in retail.

Featured Image: Photo For Everything/Shutterstock

Amazon Sellers: Inventory Tips & Tactics For 2024 Success

Achieve advertising success on Amazon by controlling inventory performance with this guide. Learn how to optimize your IPI score to increase storage volume and sales.

Robyn Johnson Robyn Johnson 6.3K Reads
Amazon Sellers: Inventory Tips & Tactics For 2024 Success

Inventory has always played a significant role in the way you sell on Amazon.

Running out of inventory can impact your organic ranking and can impact your advertising strategy.

Besides the potential loss of sales, poor inventory control also impacts the amount of inventory Amazon will allow you to send into the Fulfillment by Amazon (FBA) program.

Keep reading to learn more about:

  • How your Inventory Performance Index (IPI) score impacts your available storage volume.
  • What the IPI is, and how it’s calculated.
  • Recommended actions for improving your IPI score.
  • Tips for Amazon sellers who are new to Seller Central.

Amazon Limiting Sellers Storage Based On Storage Utilization

Amazon controls your storage capacity limits based on storage utilization and your sales history: 

Total Capacity Limit

This limits the amount of inventory you can restock to Amazon’s FBA warehouses in one shipment and the overall maximum number of units you can store at Amazon.

Accounts that have been active for less than 39 weeks are not subject to these restrictions.

It is important to note that this is only true for those accounts on the Professional Seller Plan.  Those with individual Seller Plans are limited to 15 cubic feet per month.

This limits the maximum cubic feet of storage space you have at Amazon. These limits are reviewed and adjusted monthly.

Any changes you can expect for your storage capacity for the following month will be announced on the third Monday of the month.

Included in your storage usage are the inventory currently stored at Amazon, inventory en route to Amazon, and any shipments that have been prepared but not yet sent to Amazon.

Screenshot of storage capacity monitor on Amazon Seller Central. Screenshot from Amazon Seller Central, February 2024


The Storage Volume is highly impacted by your IPI (Inventory Performance Index).

We will further discuss how your IPI is calculated later in this article.

IPIScreenshot from Amazon Seller Central, February 2024

Sellers who fall below the minimum criteria can have their storage limited. Operating with such limited storage can significantly undermine your sales forecasts.

We will outline the steps you can take to ensure you have sufficient storage for your high-demand season, maximizing your sales on Seller Central.

We’ll also review what you can do if you fall below Amazon’s set criteria.

You can find your limit by going to Seller Central, selecting Inventory, navigating to the Inventory Dashboard, and then selecting Inventory Performance under the dropdown for Inventory.

Screenshot of how to navigate to find your storage capacity on Amazon. Screenshot from Amazon, February 2024

Your IPI score will be near the top of the page.

To reach your storage capacity, scroll to the bottom of the page and click on the small gray box labeled Capacity Monitor.

Success on Amazon Means You Have To Manage Your Inventory Levels Proactively

Amazon says that it considers the following criteria for your storage levels:

  • IPI Score and Sales Performance: Higher storage capacities are granted to accounts that consistently achieve a high IPI score.
  • Storage Utilization: In determining storage limits, Amazon considers your current inventory, inbound inventory, and shipments that are prepared but not yet dispatched.
  • Sales Volume: Amazon will also look at sales volume over time.

Improving Your IPI

If you have a low IPI score, know it will take time to improve your score.

IPI is a rolling average. It can take anywhere from 2 to 12 weeks to increase your score on Amazon, so planning ahead of time is essential.

This means if your IPI is below the 400 Amazon requires, you need to start taking aggressive action today.

This article will outline how to avoid having detrimental storage limits, how it happens, and what to do when you’re already below the threshold.

For those interested in Restock Limits, we’ll explore this topic in more detail later in the guide.

What Is The IPI (Inventory Performance Index), And Does It Affect Me?

The IPI will only affect those using Seller Central and FBA warehouses.

It does not affect those using Vendor Central, Kindle Direct Platform, or those selling on Seller Central by Merchant Fulfilling or utilizing Seller Fulfilled Prime for their items.

Inventory Performance Index (IPI)

The Inventory Performance Index (IPI) manages how well you control and manage your inventory at Amazon.

This metric is a 12-week rolling average. It looks at several components over three months.

Four components make up the Inventory Performance Index (IPI):

Excess Inventory

This is the most important metric as it measures where your profitability may take a hit due to storage fees and holding costs for slow-moving FBA inventory.

Excess Inventory percentages help sellers plan when to restock more or remove inventory from FBA.

An item is considered to have excess inventory when it has over 90 days of supply based on the forecasted demand. 

Sell Through Rate

This metric is just how it sounds. The formula that Amazon uses to calculate Sell Through rates is:

(Units Shipped In the Last 90 Days)/(Average Units on Hand Over the Last 90 days)

Stranded Inventory

This provides information on products that aren’t selling due to listing issues.

This occurs when your listing doesn’t meet Amazon guidelines.

In these instances, your products become stranded and unable to move while still incurring FBA storage fees.

In-Stock Inventory

Amazon looks at the percentage of time your products have been in stock during the past 30 days, with additional weight given to items that have sold more units over the past 60 days.

If you maintain a high in-stock inventory, it will result in fewer lost sales.

Four components of the Inventory Performance Index.Screenshot from author, February 2024

It is important to highlight that these components are not weighted equally.

Excess Inventory

Excess Inventory and Sell-Through Rate are the parameters that have the most significant impact on IPI, while Stranded Inventory and Restock Rates can play a minor role in the overall score.

This means you will get more movement focusing solely on the first two components rather than spreading your efforts equally across all four elements.

During the height of the pandemic, Amazon changed the minimum IPI to 500. IT has since reduced the minimum IPI back to 400.

However, Amazon can increase or decrease the minimum IPI desired score at any point in time.

For this reason, we advise our clients to aim for a total IPI of 600.

Your minimum goal should be achieving at least 50 points over the current IPI requirement.

Some product mixes make maintaining a high IPI easier than others. For example, if you are a small brand with many products that move consistently, your IPI will generally tend to be higher.

If you are a seller with a large product mix that changes often, it is the most challenging to manage.

Combatting Capacity Limits

If you’re currently experiencing a capacity limit, Amazon can increase your capacity limit for a specific period of time by submitting a request subject to Amazon’s approval.

It is important to remember that if the storage limit increase request gets approved, your account is subject to paying a “reservation fee” for each cubic foot of capacity requested, and it will get charged at the end of the specified period.

Such fee is subject to a credit depending on your sales achieved during the period (performance credits are earned at $0.15 for every dollar of sales you generate using the additional capacity.)

Another alternative is to continue selling items via merchant fulfillment or using other third-party sellers to move your inventory or send small shipments of your fastest, most profitable inventory to Amazon.

Further down in this article, we will highlight what you can do when your inventory performance is low, you are facing potential inventory limits, or if you’re new to Amazon.

Why Would Amazon Do This?

It seems like it would be counterintuitive for a company that is so focused on having as many products on its platform as possible to limit the amount of inventory you could sell.

However, as more sellers joined the platform and with rising FBA and Prime offers, overcrowding at the warehouses started to become a larger problem for Amazon.

Amazon sellers were attracted to FBA because of the low cost of storage rates. Sellers were using the FBA program as a cheap way to warehouse large amounts of inventory.

At first, Amazon tried to increase storage fees. Adding long-term storage fees dramatically increased the storage cost for merchandise aged over six months.

However, even with those changes, Amazon couldn’t curve the overcrowding and demand in its FBA warehouses.

As a result, it started to introduce storage limits in 2019.

From Amazon’s perspective, it wants to ensure customers have favorable shopping experiences and quickly get the products they want.

This means ensuring that the products most likely to sell are available.

Amazon looks at how you have managed inventory in the past and whether customers are purchasing your products to determine how much space is allocated to you.

The better Amazon feels you are at managing your space at Amazon’s FBA warehouses, the more storage space you will be allowed.

What If My IPI Is Below The Current Threshold?

If your IPI is currently below the threshold or within 50 points of the lowest threshold, these are the actions we recommend.

The first step is to check the current threshold. As of the writing of this article, the current threshold for IPI is 400.

However, here’s the direct link to the policy so you can find the current threshold, as Amazon can change this at any time. You can find the current required IPI in Seller Support under the heading FBA Inventory Storage Limits (login required).

You can review your current IPI score in Seller Central by going to Inventory, Inventory Planning, and then clicking on your IPI score.

IPI score in Seller Central.Screenshot from Amazon Seller Central, February 2024


Even with aggressive tactics, changing the IPI significantly can take 2 to 12 weeks.

Recommended Actions To Improve Inventory Performance Index (IPI)

Excess Inventory – Dump Slow Moving Items

Excess inventory is generally one of the top two reasons your IPI score could be low, since it is the most heavily weighted metric.

The first step to addressing excess inventory is to pull back inventory you don’t expect to sell.

Focus on stock-keeping units (SKUs) that have gone out of fashion or merchandise experiencing a significant demand drop, like seasonal products.

If you don’t expect it to sell within three months, you should pull back the inventory to sell on a different channel by creating a removal order.

You can also start to use the Multi-Channel Fulfillment (MCF) to fulfill your website orders from your Amazon stock.

Sometimes, it makes more sense to discount and/or advertise products to help them sell faster to remove them from your inventory rather than call back inventory from Amazon.

Optimizing a listing that is not moving can also help increase the sell-through rate.

A quick note on having Amazon destroy products – sometimes, the company will liquidate that product instead of destroying it.

If inventory control is an essential factor for your brand, we recommend pulling back the inventory even though it costs more.

While Amazon is great at logistics and moving items through its process, it isn’t great at returning items to sellers.

Often, items arrive damaged or mixed SKUs in multiple boxes, clogging up receiving departments.

If possible, we want to ensure that we’re proactively taking action to avoid pulling back inventory and risk inventory being damaged or unavailable to be sold for a long time.

Sell-Through Rate – Send Fast-Moving Items

Amazon looks at this to identify whether the items you’re selling are things customers want to purchase.

The way that we improve the sell-through rate is to send in small shipments of items that will sell out very quickly.

If you’re currently using LTL or FTL, we recommend that you move to small parcel shipments during this process so that you can send more frequent shipments without going out of stock for long periods.

As you’re restocking items, you want to prioritize those that will move quickly, sending small quantities of items that will sell out as soon as they arrive or shortly after.

This allows your overall sell-through rate to increase dramatically and significantly impact your overall IPI.

It is vital that no matter how fast you think a product will move through, as you send these products in, you’re testing small batches to make sure that things will sell at the pace you anticipate.

Stranded Inventory

Inventory that’s being held in FBA warehouses and not available for sale affects your overall IPI.

Fixing stranded inventory can make a slight difference; however, if you need to move your IPI significantly, this component of the overall metric will only make a slight difference.

It would be best to address stranded inventory weekly or bi-weekly, depending on your general sell-through rate.

In-Stock Inventory

This is probably the most frustrating metric of the IPI because, basically, Amazon is telling you that you can’t restock items because they’re not selling fast enough.

At the same time, it’s trying to encourage you to ensure you stay in stock.

We have found that this metric is very lightly weighted, and you’re better off focusing on the two key metrics of excess inventory and sell-through rate.

There has been some debate about whether deleting previous SKUs can increase this; however, we have not seen that this significantly impacts the total IPI.

General IPI Notes

As you’re working to increase your overall IPI, it is important to remember that it can take several weeks to increase.

The IPI is an average calculated over 12 weeks.

You must give the IPI enough time to move before determining whether your actions are making a difference.

It can be tempting to check your IPI often. However, your IPI score is only recalculated once a week.

If you need to raise your IPI quickly or by a significant amount, you may need to take overly aggressive actions in pruning your inventory and pumping fast-moving items through your account to increase your score to the required amount.

You might have to also bid for a capacity increase.

You should only do this if you have the data to support being able to sell through that higher quantity of items so you do not incur extra charges.

Additional Options To Combat Low IPI and Storage Capacity Issues

Sometimes, this means utilizing third-party sellers to ensure that inventory can be available to customers with a Prime offer.

Some of the brands we work with have focused on selling their fastest-moving SKUs while they improve their overall IPI score and capacity limits.

Then, they utilized third-party sellers to carry their slower-moving items while they worked on increasing their averages.

We have several reliable third-party resellers we refer our clients to if it’s ever an issue.

This means that those accounts saw a faster increase in storage capacity as they were sending in inventory that was selling at a much faster rate and restocking regularly.

If you don’t want to utilize third-party sellers, the alternative is to increase your total number of merchant-fulfilled offerings.

Remember that Merchant Fulfilled offerings generally don’t compete well against FBA offers, so watch your competition to determine feasibility.

While many brands avoid third-party sellers because it may reduce control over their brand, in this instance, it can be an excellent tool to ensure that you don’t lose potential market share to other competing product lines.

Another step you can take is to allocate your FBA warehouse space to items with the highest margin and smallest dimensional size, as they are highly profitable and sell quickly.

Leaving items with lower profitability or moving slower through Merchant Fulfilled (MF).

Tips For New Amazon Sellers

If you’re a new seller coming to Amazon or moving from Vendor Central to Seller Central, start by sending small quantities at first.

You have a grace window of 39 weeks when opening your account.

However, you want to ensure you send in small amounts of inventory. A few cases per product can help you identify the overall sell-through rate.

There is no minimum for sending inventory into Amazon FBA. So, it is possible to test as little as one unit at a time to test products on Amazon.

Sending in small shipments does increase your overall shipping cost and can reduce profitability in the short term.

However, when you’re first investigating the platform, sending in smaller quantities can help you better understand your product’s demand and help avoid additional fees that can be required to call inventory back or pay for storage fees.

Once you have a better idea of your sell-through rate, you can start to increase the total sizes of your inventory.

It is a delicate balance to have enough inventory so that you don’t run out of stock but also that you don’t have excess inventory.

While, in general, you want to aggressively avoid stockouts, the impact of a low IPI score should take priority.

Monitoring Inventory Matters

To succeed on the platform, you must take an active role in your Amazon inventory management.

In prior years, simply avoiding restocks was enough.

However, these new requirements require a greater focus on monitoring your sell-through rate and storage utilization on Amazon.

Prepare now to support your Amazon marketing and sales goals for the coming holiday season.

More Resources:

Featured Image: Piscine26/Shutterstock

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