The Buy Box is the key to success on Amazon and very well-known to buyers and sellers alike. After all, 90% of all sales take place by clicking on this “Add-to-Cart” field, which is prominently emphasized through its golden and orange colour.
The alternative sellers, on the other hand, are often overlooked.Amazon awards the Buy Box to the one seller that – from their perspective – offers the best customer experience. Many factors like shipping time and return management play a key role here and are taken into account by the online behemoth.
Today we are going to show you what the most important metrics for winning the Buy Box.
SUMMARY
How FBA, FBM and Prime by Merchant Influence the Buy Box ?
Let’s start with the fulfillment methods.
a. Fulfillment by Amazon (FBA)
Sellers using Fulfillment by Amazon (FBA) have increased chances of winning the Buy Box. Over the last decades, Amazon has optimized its processes when it comes to fulfillment. Within the blink of an eye, goods are picked, packed and sent off to the customers. Even the return management and customer support are part of FBA. Naturally, sellers that use Amazon FBA as a fulfillment method will score perfectly for the abovementioned metrics.
After all, who better to fulfill Amazon’s high standards than Amazon themselves?
Sellers using FBA only have to send their goods to Amazon’s Fulfillment Centers. Everything else will be taken care of by Amazon itself. There is also a practical side effect: Products which are fulfilled with FBA automatically receive the Prime Label, which enables merchants to sell to the most popular target groups on Amazon.
b. Fulfillment by Merchant (FBM) et Prime by Merchant
If you prefer taking care of your fulfillment yourself, you can choose between Prime by Merchant or Fulfillment by Merchant (FBM). The first option will allow you to handle everything yourself, but Amazon will provide you with the necessary guidelines, e.g. regarding which postal service to use. In turn you will receive the Prime Shipping label and your products will be designated with the Prime label as well.
Choosing FBM means that you will take care of all processes yourself without any restrictions. Products fulfilled with FBM will not receive the Prime label whatsoever.
The final price
One of most relevant metrics is probably the final price, meaning the overall amount a customer has to pay in order to receive the product. If it is not a Prime product, the final price consists of the product price plus shipping costs.
Often the lowest price leads to winning the Buy Box. Nevertheless, this is no guarantee! Neglecting other metrics such as shipping time and customer support can still lead to losing the Buy Box.
If you take a look at some products’ price histories, you may notice that prices change frequently – sometimes several times a day! This is a hint that repricers are in use, which constantly adjust the price to the current market situation.
You can use either static and/or dynamic repricing tools.
a. Static repricers
Static repricers are rules based. So for example they would always set the price 5 cent below the Buy Box price. But they also run the risk of price dumping.
b. Dynamic repricers
Dynamic repricers on the other hand only reduce the price to get the Buy Box. Once placed in it they will increase the price as much as they can. This means that sellers win the Buy Box AND sell at the highest possible price.
A journey from warehouse to customer, which has to be perfect
As mentioned above, the Buy Box will be awarded to the seller who can offer the best customer experience. One of the most important factors in this regard is shipping. Everything has to be perfect – from shipping time to the rate of delayed deliveries.
In order to score perfectly when it comes to shipping, the following metrics must be fulfilled as best as possible:
- Cancellation rate before order processing
- Shipping time
- Valid tracking number
- Rate of delayed shipments
- Rate of on time deliveries
a. Cancellation rate before order processing
Not only will your customers be frustrated if a product is cancelled before being processed, it also decreases your chances of winning the Buy Box significantly. You may even lose the Buy Box if you have to cancel too many orders. Make sure to never have to cancel an order if possible.
By the way: the most common reason as to why sellers have to cancel before processing is because they ran out of stock, so try to keep a close eye on your warehouse and stock movements.
b. Shipping time
The shipping time is also a relevant factor in regard to customer satisfaction, as no one likes waiting for an order. Depending on the product category it should not take longer than two days. Of course Amazon understands that shipping a washing machine takes longer than shipping a ball pen.
But if delivery takes longer than 14 days, you will be disqualified from the Buy Box.
c. Orders tracking
You can increase customer satisfaction by providing the option of order tracking. For one, your customers will know when the postman will be ringing at the door. Two, if a package is assumed to be lost, the tracking ID can help find it again. This is why Amazon places huge emphasis on valid tracking IDs.
95% of your shipments should be trackable. In fact, if you want to win the Buy Box, all shipments should be trackable.
d. Rate of delayed and on time deliveries
Those IDs are also used to calculate the rates of delayed and on time deliveries. Shoppers ordering on Amazon will be given an expected delivery date at checkout. A shipment is considered late as soon as the given delivery date has been exceeded. As this is quite inconvenient for customers you should ensure on time delivery. This is also necessary to win the Buy Box, as no deliveries should be delayed at all.
If within 30 days more than 4% of your shipments are delayed your account might even be deactivated!
Your seller’s performance needs to be perfect as well
Amazon’s number one priority are the customers!
There is a rumour of Jeff Bezos bringing an empty chair into meetings. The chair being a representation of the omnipresent customer, in whose interests all decisions are to be made. Hence, sellers who want to win the Buy Box need to offer amazing sellers’ performance as well.
Here are the metrics for this:
- Order defect rate
- Return dissatisfaction rate
- Response time
- Dissatisfaction with customer support
- Average seller rating and amount of feedback
- Refund rate
a. Order defect rate
Customers receiving damaged goods or goods that don’t match the product description will, at the very least, be disappointed. Amazon considers negative ratings, unaccepted A to Z warranty claims and credit card refunds as defects.
For winning the Buy Box, sellers should have zero to no defects in their shipments. A rising number of order defects may even lead to account deactivation.
b. Return dissatisfaction rate & response time
If shoppers need to return their products due to a defect, the return management should be flawless. The customers are already disappointed and further dissatisfaction may lead to you losing the Buy Box. Make sure that your customer support is solution-based and friendly!
This also includes your response time which should not exceed 24 hours. To win the Buy Box it must not be longer than 12 hours – weekends and holidays included!
After shoppers have contacted your customer support, they will be asked if their problems could be solved. Sellers will receive a negative rating if that is not the case and their chances of winning the Buy Box decline from there on.
c. Seller ratings represent customer experiences
This leads us to the next point: your seller rating.
It is the average of ALL given star ratings you have received over time. Newer feedback is valued more than older feedback. Hence, an increase in negative feedback cannot be evened-out by older, positive star ratings. The more feedback and the higher the average star rating, the better your chances are of winning the Buy Box.
Be aware that this only applies to seller feedback and not to products! After shopping on Amazon, customers can leave a star rating. They will also be asked to rate whether the shipping time was acceptable, the product description was accurate and the customer support helpful. In addition they can write a comment which will be published on the seller’s page.
d. Refund rate
Let’s talk about the last metric: the refund rate.
If it is high, Amazon assumes that there is a general problem, whereas a low rate communicates that the sellers can fulfill their orders reliably. However, this is dependent on the category. Fashion items are returned much more often than a coffee machine. Still, try to keep this rate as low as possible.
Final thoughts
There is a lot that sellers need to consider if they want to win the Buy Box. At the end of the day, all these metrics represent the customers’ expectations. Amazon’s success is based on the satisfaction of shoppers. Satisfied customers will shop with you again. And in turn, sellers will profit.
Optimizing these metrics should be on your daily to do list.
Lena Schwab
Content Marketing Manager at SellerLogic
About our partner SellerLogic
SellerLogic offers two dynamic solutions which can be connected to your Amazon-Account with only a few clicks: The SellerLogic Repricer and Lost & Found. While Lost & Found monitors and analyzes all your FBA reports in order to find FBA errors, the Repricer optimizes your prices according to the current market situation. Both solutions work towards efficient and convenient E-Commerce profit maximization – and save you a lot of time while doing so.