Amazon Buy Box: everything you need to know
Amazon’s steady march toward global domination shows no sign of slowing. The Seattle-based behemoth achieved a 27 percent increase in revenue in 2016. Not to mention, more than half of the items sold on Amazon worldwide are from small businesses and entrepreneurs.
To that end, every online seller wants to win the Amazon Buy Box. After all, that’s where 82 percent of the site’s sales take place. Here’s what you need to know to increase your Buy Box share and improve your sales.
What is the Amazon Buy Box?
It’s the yellow “Add to Cart” button (or “Add to Basket” in the UK). Put simply, it’s the holy grail for sellers, because it guarantees high visibility and higher sales numbers.
Why is it important?
Most Amazon shoppers won’t even see your products unless they appear in the Buy Box. In fact, only 18 percent of purchases are made when buyers make the effort to scroll through other sellers and weigh up their options based on price, seller feedback rating and delivery.
How does Amazon determine who wins the Buy Box?
While the company doesn’t disclose specific targets, it is known that its algorithm is programmed to choose the sellers—one, or several in rotation—they believe will offer the best shopping experience, based on factors such as pricing, availability, fulfillment and customer service.
How to become Buy Box eligible
First things first, you need to operate a Professional seller account. Below you will find the minimum scores required for Buy Box eligibility:
-Perfect Order Percentage: 95%
-On-Time Delivery: 97%
-Valid Tracking Rate: 95%
-Late Shipment Rate: <4%
-Cancellation Rate: <2.5%
-Shipping Time: <14 days
-Customer Response Time: 90% of responses within 24 hours
How to improve Buy Box share
Selling at the lowest price does not guarantee you will win the Buy Box—Amazon’s algorithm is a balance of competitive rates, strong metrics and a great customer experience. Here are the variables that have the highest impact on improving your chances.
Three options: Fulfillment by Amazon (FBA), which allows marketplace sellers to store and ship goods from Amazon warehouses; Fulfillment by Merchant (FBM); and Seller-Fulfilled Prime (SFP), which allows vendors to ship orders from their own centres while gaining access to highly lucrative Prime customers.
FBA sellers are favored by Amazon and are more likely to be awarded the Buy Box than a FBM seller. If you are competing on a product that is FBA, you can price higher than competitors who are FBM on that product. If you and your competitors are FBA, you will need to consider your other strengths.
There are two prices on Amazon: the amount you list an item for and the landed price, which is the total cost of an order including shipping and tax. It’s important to research the competition before—and during—your listing and price your goods accordingly. If you sell products with a lot of competition, investing in Amazon repricing software is one of the smartest steps you can take to increase your Buy Box share.
The faster items are shipped, the better your chances of winning the Amazon Buy Box. How fast depends on what the product is, but if you’re competing against two-day shipping, you need to pick up the pace. That being said, don’t make promises you can’t keep. If your actual shipping time is longer than advertised, it will impact your performance metrics.
Order Defect Rate (ODR)
Amazon takes into account negative feedback, chargebacks and A-Z claims over both short-term (1-2 months ago) and long-term periods (1-4 months ago) and scores a seller accordingly. If your ODR is 1 percent or higher, your chances of winning the Buy Box are slim. Moreover, a consistently high ODR may result in the removal of your selling privileges.
This is the culmination of all customer feedback (positive, neutral and negative) you received over the last 30, 90 and 365 days, with the most recent comments having the biggest impact on your score. Amazon also takes into account how many reviews you receive relative to your selling history. A feedback score above 90 percent is essential for obtaining Amazon Buy Box share. Increase your seller rating and reduce negative feedback to up your Buy Box game.
Customer response time
Amazon’s Service Level Agreement (SLA) requires sellers to respond to customer queries within 24 hours. A late reply—or worse, no reply at all—will have an adverse impact on your Buy Box chances. Aim to respond to 90 percent of messages to remain in Amazon’s good graces. We have built the only customer support help desk for e-commerce to help you send fast, personalized responses with all the information on your customer and their order right in front of you.
Amazon won’t promote your products if you regularly run low on inventory, or have a cancellation and refund rate above 2.5 percent, because you present a threat to the customer experience. You must maintain sufficient stock levels for top-selling products to meet any potential increase in demand.
Now you know what Amazon wants for its customers and what it expects of its sellers. Your next task is to optimize your pricing—that’s where xSellco comes in. Our automated Amazon repricing software ensures you remain competitive 24 hours a day and helps you sell more at higher prices.
With xSellco, you can choose to reprice some or all of your inventory, set simple or complex rules to compete against other merchants and target your rivals. The moment one of your competitors reprices or goes out of stock, we react immediately to help you win the Buy Box at the optimal price and price up incrementally so you make more profit with less effort.
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