Your Ultimate Guide To Winning The Amazon Buy Box In 2021
Today, Amazon is entitled as the household shopping place almost all over the world. And the pandemic only did favors to the platform's popularity and usage. Since the pandemic, more and more buyers have been turning to the online marketplace, resulting in a heavy increase in user traffic. But even before that, Amazon's revenues grew enormously in the last 10 years. In 2020, Amazon registered $386 billion as net revenue sales to which the Amazon Buy Box alone contributed over $320 billion - roughly 83% of the total amount. The figure indicates the Buy Box’s domination over total sales on Amazon and how winning it can boost a seller’s sales performance.
But earning a spot on the Buy Box requires some serious knowledge and optimization tricks. In this blog, we will uncover all the secrets of the most-coveted Amazon Buy Box.
What is Amazon Buy Box?
To move along the purchase procedure, the customers are required to either click the 'Add to cart' or 'Buy now' button that appears on the right side of the product listing page. This button box is the Buy Box.
The Amazon Buy Box refers to the white-colored box located on the right side of the Amazon product detail page. This is where customers can add items to their cart for purchase or buy the product right there & then. Amazon uses this feature to determine the ultimate seller for a particular product listing from a list of potential sellers (both Amazon & third-party).
Since Amazon has not set a limit on the number of third-party sellers, there can be multiple sellers for a single product. When buyers click on a product listing, Amazon displays the best deal available to them, which can be from anyone in a pool of Buy box eligible sellers. The seller who makes it to the Buy Box spot then claims that particular sale. The feature is more prominent for mobile as the box appears right under the main image of the product.
However, not all sellers make the golden shortlist. Owing to the cutthroat competition and Amazon's customer-orient approach, only sellers with impeccable account health and seller performance have a shot at winning the Buy Box.
So, what are the requirements for a seller to earn the 'eligible' badge?
Amazon Buy Box Eligibility Requirements
The sellers are required to match these 4 criteria points to be eligible for the Amazon Buy Box:
(1) First and foremost, the sellers must have a Professional Seller Account. Amazon extracts a monthly charge of $39.99 for a Professional seller account but it's completely worth it as it increases the chances of winning the Buy Box.
(2) Secondly, sellers must have a strong Buy Box eligibility status. The same can be checked in their respective Seller Central accounts and it incorporates metrics like Order Defect Rate, Cancellation Rate, and Late Shipment Rate.
(3) Only new items can be sold via the Buy Box feature. Used items have a separate 'Used Buy Box' dedicated for them.
(4) Sellers can only sell via the Amazon Buy Box if their inventory is well-stocked and always up-to-date. Without adequate stock, the Buy Box is offered to another seller.
Understanding The Amazon Buy Box Algorithm
At present, winning the Buy Box actually means that a seller earns a share of the Buy Box for a product listing. Meaning, the Amazon Buy Box is not awarded to a single seller but is shared among multiple sellers.
The sellers who successfully clear the eligibility test are further analyzed by the Amazon Buy Box algorithm in terms of metrics such as seller history, price, etc. (to be discussed further along) for a spot on the Buy Box. For products with higher popularity and sales volume, multiple sellers may rotate their respective spots throughout the day.
As such, Amazon sellers face fierce competition in the race to winning a share of the Buy Box. Resultantly, sellers with higher performance ratings may retain a large percentage of the share. For instance, a top-ranking seller might enjoy the ownership of Buy Box for 70% of the day, while the rest 30% is divided among the lower-ranking sellers. As such, sellers need to maintain a peculiarly robust seller performance to yield the benefits of the Amazon Buy Box.
Essentially, Amazon thinks about customers the most. The main objective is to give the buyers substantial value for their money, which is achieved by weighing low prices with high seller metrics. This implies that if a seller possesses a near-perfect seller rating, they may be able to price higher and still earn the top shining spot on Buy Box. On the contrary, if a seller falls behind in terms of metrics then they will have to compensate by offering the most competitive price.
However, pricing is just one of the factors that affect a seller's Buy Box position. In reality, there is an entire collection of factors that determine which sellers emerge victorious in the race.
Amazon Buy Box: Key Factors To Consider
Winning the Amazon Buy Box is much more than just acing the rivalry in product pricing. Essentially, Amazon considers the following factors while ranking sellers for a share of the Buy Box:
(1) Fulfillment Method
Broadly speaking, sellers have two fulfillment options: (A) Fulfillment By Amazon (FBA) where Amazon handles the entire logistics of packing and shipping the product, or (B) Fulfillment By Merchant (FBM) where the sellers themselves are responsible for product packing and shipping.
Given the fact that FBA is managed by Amazon itself, there is no doubt about its efficiency and performance. Plus, it entails added incentives such as Prime delivery.
However, FBM sellers can also leverage the Prime option via the Seller-Fulfilled Prime (SFP) feature. This enables them to reach the Prime audience without using Amazon's storage facilities. But earning the SFP badge demands an impressive sales record and customer support experience.
So it's safe to say that FBA sellers have a higher chance of earning a share of the Buy Box.
(2) Landed Price
There are essentially two prices on Amazon - the price for which a product is listed by the seller, and the landed (final) price which includes shipping. Buy Box displays the landing price to the customers.
This would mean that sellers with the lowest landing price will have the highest chances of winning the Buy Box. However, the statement isn't entirely true.
In ensuring maximum value for the customers' money, Amazon displays the most competitive offer to them which may or may not be the lowest price for that listing. That's because if a seller's performance metrics are higher than that of the competitors, they can raise the price and still land a spot on the Amazon Buy Box.
In the end, it all boils down to maintaining harmony between seller metrics and the landed price.
(3) Shipping Time
Since Amazon is obsessed with customer satisfaction, shipping time is right up there with other key factors. Simply put, shipping time refers to the time taken by a seller to ship the products. FBA sellers have an advantage in this metric thanks to Amazon's massive logistics chain. This particular metric matters even more when it comes to perishable categories and time-critical goods such as birthday cards.
(4) Stock Availability
Quite obviously, sellers can only win the Buy Box if they have adequate inventory to match the customer demands. They must keep an eye out on their inventory reports and update the stock accordingly. If a seller falls short in keeping the inventory up-to-date, the chances of him winning the Buy Box reduce drastically.
(5) Seller Rating
Amazon rates third-party sellers on a scale from 0-100. Typically, sellers with higher ratings have a better shot at winning the Amazon Buy Box. The seller rating is influenced by various account metrics such as order tracking rate, valid tracking rate, late shipment rate, feedback rating, customer response time, and many more.
In essence, Amazon’s mantra is to ensure an excellent customer experience for its users. And to achieve so, the e-commerce giant only displays those sellers on the Buy Box who have an immaculate seller rating.
Winning The Amazon Buy Box In 2021
The list of factors mentioned above merely offers an insight into Amazon's Buy Box ranking algorithm. To actually win a share, sellers must consistently improve their seller metrics without compromising all the other factors. Striking a perfect balance between excellent customer support, seller performance, and other factors is indeed an intricate task. But it is very much achievable.
Here are 2 essential tips that can help Amazon sellers such as yourself to increase their chances of getting a share of the Amazon Buy Box:
(A) Identify And Improve The Metrics That Matter
Amazon sellers must always be attentive to all the seller performance metrics. But they must particularly focus on metrics that can help them land a spot on the Amazon Buy Box. Shipping time, stock availability, seller feedback score are some of the most important metrics to track & improve. It pays to ensure that you do not fall behind on your seller performance metrics.
(B) Aim For Competitive Pricing
Competitive pricing doesn't necessarily translate to the lowest price. Sellers must arrive at a price that provides a good bargain to the customers as compared to the rival sellers. The landed price factor contributes heavily to the Buy Box winning strategy. Accordingly, sellers must work to provide the best of deals at the most competitive of prices.
As such, there are three broad pricing strategies that sellers can choose from, which are as follows:
Pricing Strategies For Amazon Buy Box
1. Manual Repricing
Manual Repricing refers to the process of manually updating the prices for each ASIN. While this technique offers greater control over pricing, it also has its own challenges. Manual repricing is a powerful tool for sellers of homemade or unique products. However, the system can prove to be tedious & time-consuming for highly competitive products and sellers with a large catalog.
2. Rule-Based Repricing
Rule-based repricing enables sellers to automatically update the prices based on a set of predefined rules (also made by sellers themselves). For instance: A seller can set a condition where, at a given time, the price of the product automatically dips to the lowest among competitors while also maintaining a profit margin of at least 13%.
Although this technique beats Manual Repricing for highly popular categories, it also has its own demerits. Firstly, the sellers have to tackle the cumbersome task of frequently refreshing the rules to get the most out of this system. Secondly, the technique is majorly based on the competitors' prices and is thus limited in its capabilities.
Rule-based pricing can also result in a morbid price war where the sellers are incessantly lowering the prices, thereby driving down overall profitability.
3. Algorithmic Repricing
Algorithmic Repricing is by far the most advanced repricing method. Unlike the rule-based method, this technique comes with its own set of rules that cover all the factors for winning the Buy Box. In this regard, Algorithmic repricing ensures a more objective pricing strategy that yields higher ROI for the sellers by balancing out the profitability and product price.
The only downside of this method is that it uses professional repricing software and they are quite expensive. In any case, Algorithmic repricing can prove to be an efficient tool for large-scale sellers having a wide product catalog and high profitability.
On A Concluding Note
Beating the pricing element is not enough to land a winning spot on the Amazon Buy Box. Sellers must constantly monitor and improve upon their seller performance metrics to overtake all of their rivals. So does that mean Amazon itself is a participant in this race? Most definitely yes. Seeing as Amazon itself is also a seller on the platform, third-party sellers have to compete against the retailer giant for a spot on the Amazon Buy Box. And even though it may come off as an incredibly tough task, with the right price and impeccable seller performance, it can be accomplished.
At YourSeller, we help sellers efficiently scale their business on Amazon with top-of-the-line strategies and tools. Our dedicated team of Amazon experts shall craft a data-driven Buy Box strategy for your business, thereby boosting your sales and overall revenues.
