To say that Amazon is a highly competitive marketplace would be an understatement. In fact, it is so competitive that sellers must compete for the Buy Box on their listings. If you’re planning to start an Amazon business, winning the Buy Box should be among your top priorities.
What is a Buy Box?
A buy box is the box on the right side of your product listing that contains the ‘Add to Cart’ and ‘Buy Now’ buttons. It also shows essential shipping details, including the estimated arrival time and the product’s landed price. This is where buyers go when they finally decide to make a purchase.
Product listings without a Buy Box typically have the ‘See All Buying Options’ button instead. This button prompts consumers to take a few more steps to purchase, which is bad for your sales.
Why should your product listings have a Buy Box?
The answer is pretty obvious, but let’s break it down so you understand what you could lose if you fail to secure a Buy Box for your Amazon listings.
- 82% of purchases on Amazon are carried out through the Buy Box.
- Buyers want to avoid a lengthy and complex buying process. Only 18% of buyers are willing to scroll through more sellers and click more buttons to make a purchase.
- 72% of Amazon customers worldwide shop using their mobile devices. A Buy Box makes mobile purchases a lot easier.
- With a Buy Box, your products may appear in front of more eyes through the Sponsored Products ads.
Why does Amazon make sellers compete for the Buy Box?
It’s easy to view the Buy Box competition as an unnecessary hassle. After all, Amazon also loses whenever sellers don’t make sales. However, Amazon has a logical explanation for this, but unfortunately for sellers, it favors buyers.
Amazon believes that awarding the Buy Box to compliant and top-performing sellers leads to a better shopping experience. That’s because complacent sellers will be compelled to step up their game and become more competitive. It’s one of Amazon’s many creative ways to get rid of bad apples.
How to Win the Buy Box?
Like in any competition, Amazon requires sellers to meet specific criteria to qualify for a Buy Box. Whether you are a new or experienced seller, these criteria apply to you.
- You must have a Professional Seller account. It’s the account type where you pay $39.99 per month. Only sellers subscribed to this plan are eligible to have a Buy Box on their listings.
- Keep track of your inventory level and ensure you never run out of stock. Amazon wants to ensure you have enough inventory to fulfill orders without delays or cancellations.
- Sell NEW products, not USED. While Amazon allows selling used products in certain categories, it doesn’t encourage it, and one indicator is that used products can’t have the typical Buy Box. There’s a separate buy box for them.
- You must have a high seller rating. Amazon rates each seller’s performance between 0 and 100, 0 being the lowest and 100 being the highest. This rating averages your scores in the below KPIs.
- Delivery time: Your product must arrive at its destination at the promised time. Keep your on-time delivery rate above 97% and late shipment rate below 4% to qualify for a Buy Box.
Here’s a tip: Use Amazon FBA for faster shipping. Products fulfilled through Amazon FBA are also eligible for the Prime Badge, which allows Prime customers to have their packages shipped within two days.
This isn’t to say sellers using FBM aren’t qualified for a Buy Box, but their chances of winning are low unless they switch to FBA or qualify for Seller-Fulfilled Prime (SFP). Qualifying for SFP means you can sell to Amazon Prime customers using FBM.
However, to qualify for SFP, you must meet a long list of conditions, including shipping over 99% of your orders on time, having an order cancellation rate of less than 0.5%, and using Amazon Buy Shipping Services for at least 99% of orders.
- Order Defect Rate: Keep your ODR under 1% not only to comply with Amazon’s requirements but, more importantly, to avoid complaints, refunds, returns, and bad reviews.
- Negative feedback: Amazon sides with the buyers most of the time. If buyers say your brand is terrible, Amazon will believe them and penalize you. One sign that you’ve gotten on Amazon’s nerves is when you lose your Buy Box. Improve your customer service to avoid getting bad reviews.
- Feedback: This is the culmination of good, bad, and neutral reviews you’ve received over the last month or year. You must have a feedback rating of 90% to qualify for a Buy Box.
- Cancellation rate: Just because Amazon allows you or the buyers to cancel any time before the shipment doesn’t mean cancellation is okay. Too many cancellations show poor customer service, and Amazon isn’t happy about it. Keep your cancellation rate below 2.5%.
- Refund rate: Tied with return dissatisfaction and order defect rate, your refund rate must not exceed 2.5%. A high refund rate tells Amazon your customers aren’t happy with your brand and, thus, won’t recommend you to its members.
- Customer inquiries: Amazon also considers the traffic you’re pulling through inquiries. Sparking curiosity in your target market is the first step to making sales.
- Return dissatisfaction rate: Aim for a zero return rate to secure a Buy Box for your product. But if this isn’t possible, maintain a below 2% rating. Amazon will close your account once your return dissatisfaction rate exceeds 10%.
- Valid tracking rate: This is the percentage of packages delivered with a valid tracking number. Keep it above 95%.
- Charge disputes: Customers may contact their bank or credit card company to dispute the charge for their orders. If this happens more frequently than usual, it means there’s an issue with your account setting that needs fixing.
- Perfect order percentage: This is the rate at which orders are fulfilled without problems. You should maintain a perfect order percentage of 97% to win a Buy Box and avoid account suspension or termination.
- Pricing: It’s a common misconception that products with the lowest prices always win a Buy Box. In truth, while Amazon favors competitive prices, it also considers other factors when deciding a product’s eligibility for a Buy Box.
Important: You can still win the Buy Box even if your prices aren’t competitive as long as your other metrics are excellent.
How to Lose the Buy Box?
Losing a Buy Box is much easier than winning one. This is why it’s crucial to constantly audit your account and processes to ensure you are consistently acing Amazon’s checks. Here are some of the reasons Amazon might take your Buy Box away.
- Your account was hijacked: A hijacker—someone selling their own products under another seller’s listings—must have jumped into your account. The best indicator of this is when your Buy Box suddenly belongs to another seller or if you scroll down and notice that there are more buying options.
- Insufficient stock: If you run out of inventory or if you’re low on stock.
- Price gouging: If you raise your prices to unfair levels.
- Setting prices that are too low: Not only will you risk being at a loss, but you’ll also lose your chance of winning a Buy Box.
- Drastic repricing: Jumping a few dollars from your initial price is considered a strike against your Amazon account.
Here’s a pricing tip: When you list a product, set the price in the “your price” field to the highest price your product could sell for. Then, set the price in the “sale price” field to the actual price you want to sell the product for. Set the start date to now and the end date to sometime way into the future. This way, Amazon won’t think your price changes are drastic.
- Obsolete strategy: Scale your strategy based on the latest algorithms.
- If your seller rating drops: Inspect your Amazon account regularly to hit the correct numbers.
- Black-hat optimization: Amazon is quite sensitive when it comes to listing optimization. Avoid using prohibited keywords in your titles and descriptions, such as ‘cheap’ and ‘the best in the world.’
Earn Your Way to Amazon’s Infamous Buy Box
Keeping a clean record can help build trust on Amazon, leading to benefits like winning the Buy Box and increasing sales. Stick to Amazon listing and fulfilment guidelines to maintain your qualification for this vital feature. Always be ready to scale your strategy when Amazon introduces new algorithms or policy changes.