Are you at Risk of Losing the Amazon Buy Box?
The buy box is currently the most valuable real estate on Amazon. Statistically, 82% of Amazon sales made on desktop happen through the buy box. The percentage is even higher for purchases made on mobile. As a vendor, you are supposed to be the legitimate owner of the buy box since you are selling directly to Amazon. In some cases, however, Amazon’s algorithm may allocate the buy box to 3rd party sellers instead of you. For as long as this lasts, Amazon is not selling your inventory and you are losing sales.
Who’s eligible to claim the buy box from vendors?
The Amazon buy box algorithm uses a myriad of metrics to determine buy box eligibility for third-party sellers. Some of the critical determinants for buy box eligibility are Price, Inventory, and Reviews. According to Amazon, third-party sellers who meet the buy box eligibility and maintain a good track record can compete for the buy box placement. The buy box granted to these third-party sellers will almost always be at the expense of a vendor. So how do third-party sellers become eligible to claim the Amazon buy box from vendors?
1. Low Order Defect Rate (ODR)
ODR is one of Amazon’s critical performance assessment metric. Third-party sellers who maintain an ODR of less than 1% stand a high chance of claiming the buy box. With Amazon’s customer-focused culture, it’s a no brainer that they’ll always award sellers who provide the best customer experience.
2. A professional seller account
A professional seller account is an essential pre-requisite for sellers to become buy box eligible. Third-party sellers with professional sellers accounts stand a chance of becoming buy box eligible if they meet the other buy box eligibility criteria.
3. Fulfillment by Amazon (FBA)
There are 2 methods of order fulfillment available for Amazon sellers; Fulfilment by Amazon (FBA), and Fulfilment by Merchant (FBM). In FBA, the seller ships their goods to Amazon warehouses where Amazon handles the fulfillment and shipping. In FBM, the seller stores their products and ships them whenever they get an order. FBA sellers are buy box eligible since Amazon handles the fulfillment process and can ship items fast with guaranteed quality.
4. Minimized shipping time
Only FBM sellers entitle to this. One of Amazon’s selling points is fast shipping thanks to their FBA model. It’s for this reason that they give preference to FBA sellers when awarding the buy box to third-party sellers. An FBM seller can, however, become buy box eligible and claim the buy box by maintaining a track record of fast shipping.
5. Competitive pricing
Amazon gives preference to pricing when qualifying sellers for buy box eligibility. If a third-party seller’s prices are lower than those of a vendor selling similar items, then they stand a high chance of claiming the buy box from said vendor.
6. Item availability
The buy box comes with an influx of orders and Amazon needs to be sure that a seller can meet the demand that comes with winning the buy box. It’s for this reason that third-party sellers with a large inventory will stand a chance to claim the buy box even from vendors.
7. Excellent customer service
Amazon values customer satisfaction and rewards sellers who do the same. Amazon’s reputation is only as good as the quality of service buyers get from the platform. Third-party sellers who maintain a track record of selling high-quality items and excellent customer service stand a high chance of claiming the buy box.
What mistakes result in vendors losing the buy box to third-party sellers?
Vendors are eligible for the buy box just by being vendors. Third-party sellers also have their criteria for qualifying them to buy box eligibility. The same criteria for qualifying third-party sellers for buy box eligibility can also be used to take the buy box from a vendor. For example, a vendor can lose the buy box to a third-party seller whose prices are lower than his. Likewise, a third-party seller with a large inventory can win the buy box at the expense of a vendor with exhausted stock. It’s, therefore, imperative for vendors to track their prices and inventory in real time to stay competitive and keep the buy box.
Can you durably secure the buy box?
All other things being equal, Amazon will always prioritize vendors when awarding the buy box. It’s important to note, however, that the buy box cannot be secured indefinitely. Whenever the vendor stock is depleted or an eligible seller offers a more competitive price, the buy box can change owners.
As a vendor, you want to get the buy box back as soon as possible for two reasons. First, you obviously want to stop losing sales. Second, you do not want to reinforce these 3rd-party sellers. The more sales they make, the more they build up their reputation on Amazon, the likelier they will be to steal the buy box in the future. It’s imperative for vendors to efficiently monitor lost buy box events to avoid getting blindsided by a third-party seller stealing their buy box.
When you do detect a lost buy box, look into availability first. Does Amazon have stock? Sometimes they do but their system bugs. Have their product orders been rejected? Are you out of stock on your side?
If availability is fine, then it must be price. If you have a dedicated account manager at Amazon, see if you can work out a solution that satisfies you both. Can they match the 3rd party price? Will they ask for an effort on your side? For some of its best vendors, Amazon will sometimes accept to manually override the buy box winner.
Whatever the reasons that led you to lose the buy box, the key is to take action immediately as opposed to weeks after it happened and sales figures are low.