The news: Amazon has begun requiring third-party sellers to label any product images or videos containing “AI-generated people,” per CNBC. The company told sellers this week that listings and “A+ content”—videos or other graphics on product pages—must carry specific metadata tags before upload.

The move could force Amazon marketplace sellers, who we forecast will account for 67.0% of US sales on the platform this year, to adapt since many rely on AI to generate listing images.

Why is this happening? The retailer is making the change in response to a New York law that took effect last month and requires companies to disclose when ads use “synthetic performers” instead of human actors. Amazon said it will add a consumer-facing indicator to listings “where applicable,” though it hasn't specified the criteria for when that label appears.

Amazon's policy doesn’t apply to TV, video game, or movie characters or to content featuring real people, even if AI-altered.

Zooming out: Amazon’s move is part of a broader pattern across major platforms, as YouTube, Meta, TikTok, and Pinterest have each added labels for AI-generated images or videos in response to state laws.

In the absence of federal legislation requiring AI content disclosure in the US, states have been free to set the rules. In addition to New York’s law, California began requiring large AI providers to embed watermarks in AI-generated media earlier this year.

Implications for brands and retailers: The rule favors larger sellers with the budgets to photograph real models over those relying on AI-generated visuals. When two competing listings appear side by side, a label flagging synthetic people could create a small but meaningful credibility gap that pushes shoppers toward the option without it.

That puts smaller sellers in a bind. Many adopted AI imagery to avoid photography costs and now must choose between absorbing those costs, shifting to less realistic design-based visuals, or accepting a labeled listing that may be perceived as lower quality. Some may respond by avoiding human figures altogether, opting to show products on their own rather than risk a disclosure label. If that becomes common, listings featuring real models could stand out even more.

The broader implications extend beyond this policy change. Amazon’s update shows how a single state law can drive a platform-wide policy that applies to every US seller, regardless of where they operate. It also offers a preview of how AI content rules are likely to spread, as platforms build compliance systems for the most restrictive market and then apply them broadly to manage legal risk across regions.

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