Guest blog post by Chris Dunne from RepricerExpress
Did you know that 82% of all Amazon sales happen through the Buy Box? Consequently, if you're not in the Buy Box or more buying options, your chances of making a sale are pretty slim.
What is the Buy Box?
Amazon consists of two types of sellers, Amazon itself, and third-party sellers. For most items there will be a number of different buying options for the buyer.
When a buyer selects "Add to cart", the seller who has the Buy Box at that moment in time (the Buy Box winner rotates but more about that later), gets that all important sale.
With an estimated 82% of sales (more for mobile sales) on Amazon going to the Buy Box "winner", it is easy to see how important it is for sellers to know how to win the Amazon Buy Box.
Buy Box Factors
The Buy Box algorithm starts by analyzingeach offer by all the sellers of a product. It then evaluates each offer on the basis of history of seller, prices and many other variables which will be discussed in the later section.
After carrying out the analysis, Amazon rewards the Buy Box to what it deems as the best buying options for the customers. Amazon no longer awards the Buy Box to one seller, but instead rotate or share the Buy Box between a number of sellers. The rotation allows Amazon to know which seller is giving the best services for that particular item.
● Fulfillment Method
Fulfillment can be done either through FBA (Fulfillment by Amazon) or FBM (Fulfillment by Merchant).
Amazon gives FBA a perfect score for multiple variables including shipping method, on time delivery and inventory depth. This makes it highly unlikely for merchants to beat FBA sellers.
● Seller Rating
Seller rating is the score given by the customer to the seller.
For every order that is fulfilled without any kind of problem seller gets 100 points. If Amazon considers it to be a perfect order it then awards the seller 10 extra point. 110 points is the maximum what the seller can get.
If late shipment of the order occurs, Amazon deems this as a minor issue and gives the seller zero points.
While orders with moderate problems such as the seller canceling the order receive -100 points. Orders with negative feedback result deemed as a major problem result in -500 points for sellers.
Amazon group sellers in brackets. Moving up from one bracket to another will have a positive impact on sales with the aim being to get into the 98-100% bracket.
As seller rating is so important, many sellers are turning to automated feedback software such as FeedbackExpress to boost or protect their seller rating on Amazon.
● Shipping Time
The amount of time seller requires to ship required item is known as the shipping time. For certain products like birthday cards and perishable items this has high impact on winning the buy box.
Shipping Time is arranged into the following brackets (only includes working days):
• 0-2 days
• 3-7 days
• 8-13 days
• 14 or more days
● Delivery History
Three different elements of the delivery are considered: on time delivery; late shipment delivery; and tracked delivery rate. Each element is considered on the basis of last seven, 30, and 90 days.
On-time delivery is the percentage of order buyers received within the estimated delivery date. Late shipment delivery is the rate of order being shipped after three or more days.
● Order Defect Rate
Order defect rate (ODR) comprises of the following three different metric: negative feedback rating, A-Z Guarantee claim rate and service charge back rate.
Amazon add these rates in order to find out the number of orders which were defective. The ODR should be below 1% according to Amazon, and any sellers above this will be penalized.
● Customer Response Time
Again, Amazon check responses for the last seven, 30 and 90 days and compare them for all the competing sellers. Messages replied after 24 hours or never replied to can have an adverse effect on the ratings.
By marking as no response needed the seller can save themselves from any negative points. However replying within 12 hours increases your chances of winning the Buy Box.
● Feedback Score
Feedback score is the culmination of all feedback score the seller has received over a period of last 30 days, 90 days and 365 days, with the most recent feedback having the largest impact.
● Feedback Count
Feedback count is the number of buyers who have given seller feedback. Feedback is a key metric and higher feedback count can lead towards winning the Buy Box.
● Inventory Depth and Sales Volume
Amazon prefers sellers who have enough inventory to cater the demand which the Buy Box can create. For this very reason, sellers with large inventory, consistent sales, and good stock history may be granted a higher buy box share.
If two similar sellers are competing against each other than this factor could come into play.
● Cancellation and Refund Rate
The number of orders cancelled before being shipped by the seller and the number of orders refunded after being shipped make up the cancellation and refund rate.
A rate higher than 2.5 % can affect your chances of winning the Buy Box.
Want to Win the Buy Box?
In order to win a share of the Buy Box, sellers need to improve their metrics without forfeiting performance in other areas. It is not always easy to find a perfect balance between customer support, price and several other factors.
Three strategies that may help with this are,
● Know your metrics --Sellers should be aware of their seller metrics in Amazon Seller Central.
● Focus on the important metrics -- Some sellers might choose to focus on those metrics which have the most impact on the Buy Box.
● Improving seller performance -- Use Seller Central to see which key areas of performance you need to improve on.
Buy Box Requirements
There are four key criteria sellers must have to compete for the Buy Box,
● Professional Seller account -- Only sellers with a Professional Amazon Sellers account are eligible to win the Buy Box. Individual or Basic Seller account are not eligible.
● Buy Box Eligibility -- A seller must be Buy Box Eligible (previously called Feature Merchant) for the product in order to compete for a share of the much coveted Buy Box for that products sales. Sellers can be eligible to win the Buy Box for some products and not for other products. Sellers can fast-track their way to Buy Box Eligibility by using Amazon FBA.
● Item Condition -- Items must be new. Used items will not feature in the Buy Box but instead will feature in the Buy Used Box.
● Stock Availability — An obvious one but if you don't have stock of an item, you can't win the Buy Box with the exception of a back-ordered item.
Optimize Your Prices
Optimizing the price of your product will almost certainly increase your chances of winning the Buy Box, as price is a key factor.
Repricing software such as RepricerExpress can not save you huge amounts of time and effort as well as helping you win the Buy Box.
RepricerExpress works within your defined pricing rules and ensures your prices are optimized. With price optimization, your prices and subsequently profits will increase when a competitor runs out of stock.
Delivering a first class customer experience gives sellers the ability to raise their prices significantly and still maintain a healthy Buy Box share,
guaranteeing the maximum possible profit for each and every sale.
Finding the optimal pricing point for every product is crucial and challenging. Get it almost right and you’ll probably win some sales, perfect it and you’ll watch your overall profits soar!
With RepricerExpress you get a super-fast repricing solution that is really easy to setup and works across Amazon and eBay. Plans start at £35/$50 and include a free 15-day trial for you to try out and see if it works for your business.
Sign-up today using the promo code “ORDERHIVE10”, and you can enjoy 15 days of Amazon repricing for free (no credit card required), then get a 10% discount on your first month’s subscription.
If you have any other repricing queries, get in touch via email@example.com and one of our great customer support team will get back to you asap.
About the Author
Chris Dunne is Marketing Executive at RepricerExpress who writes over ecommerce mainly. Chris is a huge football fan and craft beer nerd.
Simple, yet powerful