One of the key ingredients to success with Amazon FBA is the ability to get the “Buy Box”. Without it, you can spend long periods of time making ZERO sales.
But what is the Buy Box, and more importantly, how do you “own” it to make more FBA sales than ever before?
What is the Buy Box?
When we list items to sell on Amazon we use a listing that has already been created, and unlike eBay where each item for sale is listed individually, Amazon sellers share the same individual product listings.
There are exceptions to this such as if you create your own listing for a private label product, but in general when you add a product to your inventory it will already have an ASIN (the unique code for products on Amazon) existing on Amazon.
All sellers of an item will share the listing.
So when a buyer lands on this particular item the option to buy it, or “Add to Cart” is given to the sellers who “own” the Buy Box.
On the face of it to the untrained buyers eye, it looks like it’s Amazon on the listing and that’s exactly how they want it to look.
80% of all sales on Amazon are sold through the Buy Box, so sellers who win the Buy Box will make more sales than others.
As an arbitrage seller, you need to know the importance of winning the Buy Box to increase your sales.
How the Buy Box works
Amazon is a very competitive marketplace, and if you check prices they are keen on lots of products they offer.
Their aim is to give their customers the best buying experience, not only with customer service, but with competitive prices at well.
In the early days it was all about price in winning the buy box, but now its not only just about the price, other metrics come into play in helping you achieve your goal of winning the Buy Box more often.
If at times you don’t see the Buy Box but only see “ see all buying options button” this is when the prices are higher than the list price, and Amazon think the prices are unreasonable.
In this situation, there is no Buy Box “winner”.
Here’s some of the metrics that influence your eligibility to win the Buy Box.
You will need at the very least to have:
- a professional seller account
- the products must be new
- you must have stock available to sell of the item, already at the Amazon warehouse
The metrics below are in order of priority of meeting the Buy Box eligibility criteria, and meeting them will increase your chances of winning the Buy Box on your items dramatically.
- Fulfilled by Amazon rather than Merchant Fulfilled
- Your price
- Perfect order percentage
- Shipping time (covered by FBA)
- Order defect rate
- Feedback count
- Your inventory amount
Amazon as a seller on their own marketplace meet all the above requirement by standard.
The Buy Box algorithm treats Amazon as a seller too, but one which has a perfect score…
…but if you can match these metrics on a item that Amazon sells on, you have the chance to match, share or beat Amazon to the Buy Box.
Sharing or rotating the Buy Box
If a number of sellers are all meeting similar metrics, the Buy Box may be shared equally between these sellers.
In this circumstance it will share a percentage of Buy Box coverage time to each seller, or a better performing seller could have slightly more Buy Box time depending on the metrics.
When Amazon won’t share the Buy Box
The most demoralising thing that can happen as an FBA seller is when Amazon just WON’T share the Buy Box…
…no matter what price you set and even when you’re ticking all of the eligibility criteria.
Certain categories such as books and downloadable media have algorithms that only allow Amazon the Buy Box eligibility if in stock.
So immaterial of what you do, you won’t get the Buy Box.
Other times where Amazon are on the listing it could be down to some of the metrics mentioned above that you aren’t meeting, and sometimes it’s just out of your control,
Amazon being on a listing are the big player in the market, and having lots of inventory/stock on a fast moving item may mean that they hold the Buy Box until such a time as they go out of stock before they share or give up the buy box.
But remember, there will always be a perfect scenario for Amazon to give up the Buy Box and the algorithm is tuned to maximise Amazon’s coverage in this situation.
So sometimes when you think “Why am I not winning the Buy Box?”, check through the metrics required to help understand why and chance if possible some of them to help achieve buy box status.
Other times, Amazon will just give up the Buy Box, and unfortunately in this situation you don’t really know until you send an item in whether they will or not.
This is something I call “The 3 Levels of Unpredictability”.
The big one — “Price”
Out of all the variables you can change, price is the one which is the simplest and easiest to control.
If you look at the supply and demand factor it’s easy to see it plays a massive part in selling items on Amazon.
The price you sell for is the one part you can influence instantly by adjusting it at the click of a button.
However, if your seller metrics are not meeting Amazon Buy Box requirements you will always have to sell at a lower price to obtain the Buy Box.
The race to the bottom
Due to the demand for the Buy Box, sellers try to undercut each other in a effort to win it.
Undercutting each other by a penny is a really dumb idea, as all that happens is the price goes down (thus crushing margins) and the demand goes up so more items are sold quickly.
This is called the “race to the bottom” and it ALWAYS eats into profits.
Setting your prices to give you your desired profit is vital, otherwise if you’re making no profit there is no future in your business.
There will be times when you have made a bad purchasing decision or prices have crashed around you, and you will decide to reduce prices to liquidate your stock.
This is slightly different to the race to the bottom, because you are making these decisions for a positive reason and it’s not your usual pricing strategy.
Otherwise you’re making lots of bad buying decision which is a different issue.
Manual repricing or repricing tools?
If you have tons of items in your Amazon inventory, using a repricing tool/software will often be necessary to maintain your pricing structure, even if you’re only inputting min – max price ranges into the repricer.
This will help and you can get more advanced using % differences etc which is covered with most repricing software guidelines/tutorials.
For less amounts of inventory, and sellers new to Amazon, manual is the way to go to learn the process and avoid mistakes…
…this can be easily achieved by adjusting prices in the dashboard of your Amazon Seller Central.
How to play it
When you look at a listing on Amazon, firstly check to see what price is in the Buy Box and then see if this meets your desired sell price and ROI.
Then check to see how many other sellers are on the listing and how much stock they have.
If you’re selling through FBA, you are only interested in FBA and Amazon as competition.
This is because Merchant Fulfilled even when priced lower usually doesn’t meet the Buy Box criteria a outlined earlier.
So you should see where you would be sitting amongst the competition (if any),check inventory of the sellers, and finally estimate how many per month are sold – all of this can be done in seconds using WizardBar (which you get free on this special link – just for trying FBA Wizard.)
Based on this information, you’ll be able to make a conservative guesstimation as to where you will sit on the listing, and how long you will have to wait if any to get into the Buy Box.
You can also use the Keepa charts to help make price history selling decisions.
There are lots of ways to play it, it depends on your strategy, and quickly you want to return your money.
It also worth bearing in mind that Amazon is a moving picture, so what you see today might change tomorrow, as new sellers appear on listings and so on.
It’s nearly impossible to control or predict this, but it’s still worth remembering.
How to check your metrics in Amazon Seller Central
So you want to know if you’re Buy Box eligible?
Follow these steps to check your seller metrics:
Go to Seller Central and click Performance > Customer Satisfaction.
There you can see a summary, along with a breakdown of Account Health and Customer Feedback.
It’s worth monitoring this occasionally to make sure everything stays healthy.
When/if you receive a negative feedback for an item you’ve sold through FBA, Amazon will take responsibility for it, striking through the rating and making a comment.
If this doesn’t happen, be sure to open a support ticket with Amazon so they do it for you.
I have covered the importance of the Buy Box in terms of selling on Amazon, and making sure you’re meeting the metrics to ensure your eligibility to win the Box more often.
Learn to put strategies in place to help win the Buy Box (without killing profit), monitoring account health, feedback, and your prices.
Keep checking your account for any changes to status, and take action if these metrics are not meeting the basic requirements…
…this can be something that you can miss if you’re not checking your metrics on your seller account.