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#Amazon FBA

How to Win the Amazon Buy Box (in Q4)

There are so many keys to selling successfully on Amazon, but none may be bigger than winning the Buy Box.

The Buy Box is the boxed section found to the right side of an Amazon product page, where customers have the option to either add items to their shopping cart with the “Add to Cart” button - or make the purchase instantly with the “Buy Now” button.

Why is winning the Buy Box so crucial? Take a look at these numbers.

  • - Amazon’s annual sales revenues are over $150 billion each year.
  • - $111 Billion of those sales come through the Buy Box.
  • - That’s over 82% of sales through the Buy Box - and there’s even more sales on mobile.

 

In other words, for Amazon sellers, the Buy Box is a money-printing machine. Whether you’re a brand-new seller launching your first product, or a veteran pro on product 1000, winning the Buy Box is essential to increasing your Amazon sales.

We’re going to take an in-depth look at the Buy Box - what it is, how it works, and most importantly, how to win the Amazon Buy box in 2018.

We’ll give you actionable advice that will help you increase sales and make this your most profitable Amazon selling quarter of the year.

What is a Buy Box?

 

As mentioned at the top of the article, the Buy Box is the area to the right on an Amazon product detail page where customers can choose to add items to their cart or make an instant purchase.

The Buy Box is not just a home for buttons on the Amazon website - it represents a significant competitive advantage, and winning it takes some strategy.

Let’s step back a moment and consider how Amazon works.

Every product on Amazon has its own product detail page. This includes detail pages for the same product from different sellers.

There are two types of sellers on Amazon - Amazon itself, and third-party sellers. This means most every product has a variety of options and prices from different sellers that potential customers could choose from.

If you are the winner of the Amazon Buy Box for your product, when a customer selects “Add to Cart” or “Buy Now”, they will be purchasing from you.

Basically, the Buy Box seller gets a majority of the orders for the product.

We say the majority of orders because the Buy Box winner for a product rotates among the current winner and other sellers. We’ll break this down more in the next section, but for now, just note how important winning the Buy Box could be to your overall sales.

Not every seller is eligible to win the Buy Box. The winner is determined through Amazon’s algorithms which incorporate a number of metrics and variables.

Optimizing your product sales to not only be eligible to win, but to be the winner, is challenging and different than other online sales channels. The Buy Box is the gateway to increasing your sales by a significant margin.

Winning the Buy Box is even more helpful for mobile selling.

On the mobile Amazon experience, there’s no easy way to immediately search for other sellers, so the Buy Box winner gets an even higher percentage of product sales.

To recap:

  1. Multiple resellers and Amazon itself sell the same products on Amazon. This creates a competition to win the Buy Box.
  2. The winner of the Buy Box, which rotates among eligible sellers, gets the majority of sales of the product when a customer adds it to their cart or makes an instant purchase.
  3. The winner is determined by an algorithm that considers various seller metrics.
  4. The Buy Box winner gets even more of the sales on mobile, due to the UX design of the Amazon mobile experience. 

Now let’s take a look under the hood at how all this actually works.

How Does the Buy Box Work On Amazon?

What is Amazon Buy Box

Before we dig into how the Buy Box works, let’s briefly look at where all the sellers of a product can be found on Amazon.

The Buy Box winner is the main seller of the listed product on Amazon. If you are not the lucky winning seller of the Buy Box, you’re not totally out of luck yet.

Below the Buy Box is another box titled Other Sellers On Amazon.

Up to three sellers are featured in this box, and often these sellers rotate the Buy Box position with the current winner for that product.

If you click through to see all the other sellers available on Amazon via the link in the Other Sellers box, you’ll come to the Amazon Offer Listing Page.

Here’s where all the sellers for a given product can be found.

They are ranked by total delivered price (price + shipping), and FBA and FBM sellers are treated equally without consideration of additional seller metrics.

Amazon-savvy, bargain-hunting shoppers will often find lower prices here for desired items, and purchase those instead.

The Buy Box winner is not always the lowest priced item, but the Buy Box winner is most convenient to purchase. This is the leverage of winning the Buy Box position for your product.

On mobile, it takes a bit more work to find the listing page. Most mobile buyers are valuing convenience over price, which is why winning the buy Box is even more important on that platform.

The Amazon Buy Box algorithm analyzes each offer by all the sellers of a given product. Then, it evaluates the offers on based on price, seller history, shipping method, and other key metrics about the offer.

Amazon formerly awarded the Buy box to one seller, but now rotates the Buy Box between multiple sellers.

The Buy Box is awarded to the seller (or sellers) that Amazon considers to be the best value for customers. As the variables evaluated by Amazon change over time, so will the Buy Box winner.

In general, winning the Buy Box is not as simple as having the lowest price, and the Buy Box is not necessarily the lowest priced item.

There are many complicated variables and metrics at play, but FBA sellers can usually set prices between 10-15% higher than FBM sellers and win the Buy Box.

Also, FBA sellers who match the price of the Buy Box winner will share the Buy Box and get a percentage of orders.

These are not hard and fast rules. Not every seller is eligible, and it’s important to optimize all the variables while being a Buy Box eligible seller.

If a top product in a category is an Amazon product, then Amazon will have the Buy Box. Remember, Amazon isn’t just a selling platform for resellers. Amazon carries its own robust and growing product lines and doesn’t necessarily like to share the Buy Box with third party resellers.

Now that we know what the Buy Box is and how it works, let’s see how you become eligible for this prime piece of product display page real estate.

How Do You Get Eligible for the Buy Box?

As an Amazon seller, you want to make sure you are eligible to win the Amazon Buy box for your product.

Amazon evaluates all eligible sellers in its process to determine the buy Box winner. If you want a piece of the Buy Box action, here’s what you need to have.

  1. Professional Seller Account

According to Amazon, you must have a Professional Seller Account to be eligible for the buy Box.

In Europe, you must have a Pro-Merchant Account.

While individual account are not considered eligible, there have been anecdotal reports of sellers with individual accounts winning the Buy Box.

To be ensure eligibility, have a professional account for your country (or countries, if you sell in multiple geographic areas).

If you have a new seller account and are not using FBA, there will be delays in your Buy Box eligibility. Amazon wants to see proof that you have the products and can fulfill the orders first. For this reason, FBA sellers are approved much faster than an Amazon Buy box new seller.

  2. Buy Box Eligibility Status

Your Buy Box Eligibility Status for a given product can be checked in Amazon Seller Central.

US- based sellers can go to their ‘Inventory’ page, click on ‘Manage Inventory’, then click ‘Preferences’.

In the ‘Buy Box Eligible’ field, select ‘Show When Available’. From there, you can check each product ASIN to see if it is eligible.

Please note: This convenient feature is not available yet in Europe.

  3. Items Must Be New

Only new items are eligible for the buy box. Used items are available for a different box, called the Buy Used Box.

  4. Availability

You must have stock of your products in order to fulfill customer purchases. If you are out of stock, the Buy Box will pass to another reseller.

These are the minimum criteria required by Amazon to be eligible for a share of the Buy Box winnings.

Once you and your product have leapt these hurdles, Amazon’s algorithm will then evaluate you for a number of metrics and variables against your competitors to see who wins the Buy Box.

Let’s take a look at the formula Amazon uses to decide the Buy Box winner for a product.

The Amazon Buy Box Formula

Amazon Buy Box Perfect Formula

Amazon’s algorithm evaluates a number of metric and factors in determining the Buy Box winner for a given product.

Of course, only Amazon knows for certain the exact specifications for evaluation, but these are the highly educated guesses based on years of Amazon selling experience for the variables evaluated in the Amazon Buy box formula.

If you want to win the Buy Box, be sure that you and your product are eligible, then become excellent in all these factors to get yourself a share of the Buy Box sales.

Here are the 13 key factors in the Amazon Buy Box formula, listed in order of relative importance:

  1. Fulfillment Method

The Fulfillment method appears to be the most important factor that Amazon considers.  considered by Amazon.

There are three ways to fulfill orders on Amazon, and here they are in order of ranking for the algorithm:

  1. FBA (Fulfillment by Amazon)
  2. Seller-Fulfilled Prime (SFP)
  3. FBM (Fulfillment by Merchant)

 

FBA achieves a perfect score for fulfillment due to its superiority in multiple factors, including inventory depth, shipping method, and on-time delivery.

Another well-scored method is Seller fulfilled Prime, which allows qualified sellers to ship goods to Amazon Prime members without housing their merchandise in an Amazon warehouse. FBM is advantageous to sellers of heavy items, as it allows them to save on shipping, but does not score as well as the other two.

  2. Landed Price

The landed price of an item is the price + shipping and VAT (UK and EU only).

This “total” price, separate from the listing price, is a very important factor in the algorithm. It’s important to keep the landed price in mind when you are pricing a product.

Just because you have the lowest price on an item, you will not necessarily win the Buy Box.

It is only one factor of many considered. If your seller performance is higher than a competitor with a lower price, you can still get a share of the Buy Box - and even raise your price.

  3. Shipping Time

A fast shipping time is a very important variable in winning the Buy Box, especially if your product is perishable or has an expiration date.

Examples might be food, coffee, holiday or birthday cards, and the like.

Shipping time is considered to be the amount of time a seller takes to ship an item.

It’s visible on the product detail page. Shipping time is segmented into 4 groupings: 0-2 days, 3-7 days, 8-13 days, or 14 or more days.

The faster you ship, the better it is for your Buy Box chances.

4. Order Defect Rate

Amazon calculates three metrics to determine your Order Defect Rate (ODR) - the number of orders which were defective.

These metrics are: A-Z guarantee claim rate, negative feedback rating, and service chargeback rate. The ODR is important, because if your seller ODR is above 1%, you’ll be penalized by Amazon.

  5. Valid Tracking Rate

An important new performance metric from Amazon monitors the percentage of total packages shipping with valid tracking.

Valid tracking numbers are expected on 95% of your shipped packages, over periods of the last seven days and last 30 days.

If you don’t meet these numbers, you could not only negatively affect your chances of winning the Buy Box, but also endanger your ability to sell on Amazon.

  6. Late Shipment Rate

You’ll need to keep your late shipment rate below 4% to increase your chances of winning the Buy Box. This is the the number of orders shipping later than the expected ship date.

You can set and monitor this in Seller Central.

Sellers who don’t set a handling time will be given a 1-2 business day default shipping time, and you can monitor your rate for the last seven and thirty days.

  7. Delivered On Time Rate

The companion rate to the late shipment rate, this metric is the percentage of orders delivered on time (by the estimated delivery date).

Also viewable in seven and thirty day intervals in Seller Central, it’s important for your Buy Box chances to have a 97% or higher score.

  8. Feedback Rating

Positive customer feedback is so important for Amazon success, and winning the Buy Box is no different.

Amazon rates your feedback over the most recent 30 day, 90 day, and 1 year periods in its evaluation. The most recent feedback receives the highest weight in Amazon’s calculations.

  9. Customer Response Time

Replying to customers within 12 hours greatly increases your chances of winning the Buy Box.

Amazon looks at this over the most recent 30 day, 90 day, and 1 year periods and compares it to your competitors.

Two important things to know:

  1. If the number of messages never replied to, or replied to after 24 hours, equals 10%, this will hurt your ranking.
  2. If those messages were marked as not needing a response, no negative marks will be held against the seller.

  10. Feedback Count

In yet another instance of the importance of customer feedback, the total number of customers who have given feedback to the seller is considered in your Buy Box competition.

The more buyers who have given feedback, the better.

  11. Inventory Depth and Sales Volume

Amazon rewards sellers with consistent sales, a large inventory, and a good stock history in their calculations.

If you frequently run out of stock, you’re very unlikely to win the Buy Box. Buy Box winners need to have plenty of inventory to meet the increased demand of the position.

  12. Cancellation and Refund Rate

Your cancellation rate is the number of orders cancelled before being shipped by the seller.

The refund rate is the number of orders refunded after being shipped. Combined, this rate should be below 2.5% in order for it not to affect your Buy Box formula.

  13. Return Dissatisfaction Rate and Customer Service Dissatisfaction Rate

These are two new metrics introduced by Amazon that are aimed at improving your customers buying experience.

At the current time, they are not being used in the formulation toward the Buy Box winner, but it’s entirely likely that they will be in the future. Monitor these and keep them in good shape to be on the safe side.

  14. BONUS METRIC - Amazon’s Perfect Score

As we mentioned earlier, you’ll often find yourself going head to head with Amazon in a category.

All Amazon products are considered to have perfect metrics - the best formula of all, is, of course, their own.

So how can you compete against that?

Believe it or not, it is possible to beat Amazon itself for the Buy Box, or at least a share of it.

In the past, Amazon always won the Buy Box on books and media (as long as they had stock); but they now are allowing resellers to compete with them in their own backyard.

The key is to have perfect metrics yourself, then beat them on price, sales history, or any of the other factors.

 

Now that you know how what the Buy Box is, how it works, how to be eligible to win, and the factors that go into determining the winner, we need to talk about sharing.

Not because sharing is cool or important - because it is - but because often you will share the bounty of the Buy Box with other sellers.

Let’s take a look now at how that works, and how it ties into our Bonus Metric.

What is the Amazon Buy Box Percentage?

After the Amazon algorithm parses all your variables and metrics versus the competitors, it determines a Buy Box winner.

More precisely, it determines which sellers offer the best overall value and gives them each a percentage of the Buy Box.

The Amazon Buy Box Percentage is the percentage of page views where the Buy Box appeared on the page for customers to add your product to their cart.

If there are popular items that have many high quality sellers, the top Buy Box position will rotate among them.

If one seller is clearly above the rest, that seller may have a higher percentage and thus keep control of the Buy Box for more of the day.

If, somehow, you are the only eligible seller of a product, then you become the Amazon Buy Box only seller.

For example, a top-rated Buy Box winner might control the box 75% of the day, while other seller or sellers might split the remaining 25%. Alternatively, four equivalent sellers might split the day’s Buy Box time at 25% each.

If you want to check your Amazon Buy Box percentage, it’s easily done.

Go to Amazon Seller Central and go to ‘Reports’, then ‘Business Reports’, then ‘By ASIN – Detail Page Sales and Traffic’.

Here you can monitor the percentage share of the Buy Box you are achieving for each product ASIN. Then you can easily identify which ASINs need to be optimized to get a greater share of the product Buy Box.

What is a good buy box percentage on Amazon?

Well, that’s a good question. In most cases, the higher the percentage the better.

Amazon is ultimately trying to balance price against seller metrics to get customers the best value in the Buy Box.

On the seller side, this means you need to balance too.

If your seller metrics in the Amazon Buy Box formula are perfect, you can charge more. If your metrics are not as good, you’ll need to lower your price to a competitive level to compete.

The percentage that’s best is the balance between what allows you the most control of the Buy Box while at the same time generating the most profitable sales.

This will be different for different products in differing categories, so mind your metrics, pricing, and sales to determine how much of the Buy Box you need to be a winner.

However, given the level of competition on Amazon, any share is better than none. Use your judgement and metrics to decide what’s best for you.

What happens when you are competing against Amazon itself?

As described in our Bonus Metric, Amazon gives itself the perfect score.

Why wouldn’t they?

Your best bet is to perfect your own formula scoring and be competitive on price with Amazon. Then, at the least, you should be able to share the Buy Box bounty with Amazon. It is possible to beat them on certain variables in the formula, depending on the product.

This leads to our next topic - what are some actionable strategies and tactics you can use to get a bigger piece of Buy Box pie for your products?

How to Win The Amazon Buy Box in 2018 Q4?

win the buy box

In the ultra-competitive Amazon selling environment, you’ll have to compete hard to win a share of the Amazon Buy box for your product.

It’s not impossible by any stretch of the imagination, but as mentioned previously, it requires a balancing act between the various metrics measured by Amazon’s Buy box formula.

Here are 5 tips that will help you win the Amazon Buy Box in 2018.

  1. Watch Your Metrics Closely

Keep a close eye on the top 13 factors in the formula and make sure you optimize each one to the best of your ability.

While it’s difficult to balance them all, depending on your product of course, just paying attention and tweaking results as needed will give you a competitive advantage over sellers who are asleep at the wheel or that have their listings on auto-pilot.

  2. Focus on the Most Important Parts of the Amazon Buy Box Formula - #’s 1-3

Your Fulfillment Method, Landed Price, and Shipping Time are the most heavily weighted parts of the Amazon Buy Box formula.

Keep these in the best shape possible to achieve the best results in your pursuit of the winning Buy Box percentage. Make sure your orders are fulfilled reliably and on time, and that your price is competitive to stay ahead of the game.

 3.  Sell Using FBA

By selling via FBA, as opposed to FBM or SFP, you’ll immediately improve your results in essential criteria such as shipping time and customer feedback.

This can make a major impact on your ability to win the Buy Box, as well as competing in general on Amazon sales. If you have to stay an FBM seller for some reason (such as selling heavy items like barbells or appliances), do what it takes to shift to SFP so that you have a better chance of securing the Buy Box.

 4.  Improve Your Seller History

Tighten your selling game from all angles.

Follow your metrics in Seller Central closely as recommended in #1, and do the following to improve your recent Seller History.

In the short term, undercut the competition on price. While this may be a money losing strategy, if you do it short term it will allow you to grab a percentage of the Buy Box from a dominant seller. Then gradually increase your prices while holding the Buy Box as your sales volume increases.

 5.  Stay Vigilant on Pricing

While owning a share of the Buy Box isn’t all about pricing, at the end of the day it’s a large piece of the puzzle.

Some sellers employ Amazon Buy Box software for automated repricing to help them monitor the competition.

Amazon’s own Automated Repricing software is free to use but fairly limited, so you might want to try a competing brand of intelligent repricing software in order to have more control and better results.

Another strategy is manual repricing. While this is time-consuming, it offers very specific control as you’re doing it yourself.

When you see a competitor out-of-stock on their product, it’s time to strike with a manual repricing of your product to take advantage of their stock-out and grab a bigger share of the Buy Box.

As a rule of thumb, and pursuant to tip #4, in order to win the Buy Box, you should match the price as opposed to undercutting the competition.

 The hope is that other sellers will also match and everyone can share the Buy Box profits.

Ultimately, sharing a percentage of the increased orders is far better than no share of the Buy Box at all.

If there are too many undercutters in the product niche, it is reasonable to consider not selling the particular product, as it may be too difficult to make a profit.

Win the Buy Box

 

It should be clear at this point that owning a share of the Amazon Buy Box is a powerful tool to increase your sales, but the system for achieving this is fairly complex with a lot of moving parts.

As a third-party FBA seller, you have a lot of advantages and tools at your disposal to make winning the Buy Box for your product an achievable reality in 2018.

By giving your customers a first class experience and product to match, and selling it at a competitive price, you’ll be well on your way to taking a share of the Buy Box.

Diligent adjusting of your metrics, formula components, and pricing will lead you to winning the Amazon Buy Box and having the best sales year yet.

As Bobby Knight, the Basketball Hall of Fame coach from Indiana University, once said:

''The key is not the will to win… everybody has that.

It is the will to prepare to win that is important.''

Be prepared, do your homework, optimize your Buy Box formula - and go win that thing!

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