In the previous post was mentioned that Amazon is “marching” towards global domination. Now is the right time, more than ever, to include it in your e- commerce business. Since it shows no signs of slowing, being just present on Amazon marketplace won’t bring you much success. With millions of third party sellers on the marketplace, which are pretty much selling the same thing requires more than just offering items at a certain price.

The Amazon marketplace is a very competitive place, prices fluctuate constantly. Amazon sellers compete to offer the best price and win the Buy Box – the yellow “Add to Basket” or “Add to Cart” box that powers 90% of sales on Amazon. In fact, 82% of searches that results in sales are because of Her Majesty – THE BUY BOX. The other 18% of sales are made when buyers make the effort to scroll through more sellers, and make their decision based on a price, feedbacks and delivery. Therefore, buyers might not even see your products unless they appear in the Buy Box.

But what is actually the Buy Box?

Let’s say you are a customer and want to buy something from Amazon. You search for an item, and Amazon pops out a list of items where each is offered by a X number of sellers. The item that has the Buy Box, will end up in your shopping cart when you click “Add to Basket”. Buy Box is responsible for the majority of the sales. It is the holy grail for Amazon sellers. To give customers the best possible shopping experience, sellers must meet performance-based requirements to be eligible to compete for Buy Box placement.

What do I need to do be eligible for the Buy Box?

In order to became a Featured Merchant (or eligible), make sure you do, or have the following :

  1. Have a professional seller account. Don’t even think to have a fake account!

  2. Amazon grants Buy Box permission only to sellers who have been selling more than 3 months. Make sure you have been actively selling for a solid amount of time.

  3. Sell new items! Used items won’t bring you a piece of the pie.

  4. Take care of the availability of your items stock. Amazon algorithm favors sellers having adequate inventory.

Without this 4 things, don’t even dream about The Buy Box.

What’s next?

Who is going to get the Buy Box, not only depends on the price of the item but as well on some other performance metrics.

To make it more understandable and visual, imagine a scale. On the right side of the scale is the price of the item. On the left side is the customer experience that Amazon has with the customer. This includes:

drawing

Fulfillment type. Are the items delivered by the seller or by Amazon? Since FBA items are shipped by Amazon, they have the perk of selling at a higher price and still have the Buy Box. Amazon says, you can go 4% higher with the price and still get the Buy Box. Maybe it’s time to consider becoming FBA? Or, even better, get the Seller Prime Badge, and ship your items from your warehouse while having better chances for the Buy Box.

Shipping costs. This shows the amount of money that the customer has to pay in order for the item to be delivered. It can be set up additionally to the price, or included in the price. Amazon always prefers included shipping costs, and gives more chances for winning the BuyBox.

Shipping time. The time that an item takes to be delivered. Amazon always prefers minimum time of shipping. Sellers that are shipping within a day or two have more chances for the Buy Box from sellers that ship in two or three weeks.

Ratings. The bigger the number of the ratings, the bigger the chances for the Buy Box.

Cancellation rates. If you cancel customer’s orders too often, it could have a negative impact on your ratings.

Customer Response time. Make sure you respond as fast as possible to customer’s questions, or it would negatively influence on getting the Buy Box.

The best mixture of the price and the customer satisfaction that Amazon has with the seller, leads to winning the Buy Box. For many sellers, Buy Box means better visibility on Amazon, and most of all, more sales. Taking all this into consideration, sellers on Amazon are facing the challenge to have the best performances metrics and have good prices, so they can increase their turnover.

Being in highly competitive position, Amazon sellers must find a way to deal with their competition. Knowing that they have to fight for the Buy Box, leads to the fact that have to take care of their performances and prices. In this environment, at some point the prices will be either too high to be competitive, or too low to make a healthy profit. One option to navigate these challenges are the automated RePricers. Automated reprising is when the price of a product is automatically changed. This change could be in reaction to a competitor’s price change, or to take an advantage when a competitor runs out of stock.

For more than 10 years software companies are selling a reprising solution to Amazon sellers. They have all started at the same point, checking who is the cheapest competitor on an item and pricing "against him" by setting a lower price. To get the seller’s offer more attractive to the buyers, this has leaded over the years to the impression, that using such software only decreases the prices. Fortunately, it is just that basic software that are only placing low prices, but that is not Amazon’s intention how a seller should be able to sell.

Want to find out how to sell more strategically, and win the Buy Box?

Then just Sign up here! and read in our next post why eSagu! should be your best friend when fighting for Her Majesty – The Buy Box!