Amazon

What is the Amazon Buy Box?

Date Published: 4/28/2021

Amazon Listing and Buy Box Competition

Last Updated: 6/16/2021

The buy box, meaning a group of sellers competing for sales of a particular product, is the foundation of the Amazon Marketplace. The Amazon buy box is a stressful, but potentially lucrative game of retail King of the Hill. 

Many sellers are intimidated or overwhelmed by the aggressive competition for buy box wins on Amazon. Others feel helpless to understand the “black box” of the Amazon buy box algorithm. We’ve learned over many years of selling on Amazon and many long days and nights working with other Amazon sellers to understand and resolve buy box issues that the “secret” isn’t really all that complicated, but it does require consistent attention and awareness.

Attributes and Considerations

Buy Box Eligibility

One of the first concepts to understand about the Amazon buy box is buy box eligibility. Buy box eligibility, also referred to by Amazon as Featured Offer Eligibility is determined on two levels:

  1. Seller - Is the seller eligible to win the buy box or to become the featured offer on Amazon?

  2. Product - Is the seller eligible to win the buy box for a particular product and/or condition?

If a seller is not buy box eligible (featured offer eligible), the seller will not under any circumstances win the buy box, making it critical to understand how to become buy box eligible on Amazon, or in other words, how to become featured offer eligible. 

According to Amazon:

Your offers are eligible for the Featured Offer if you have a Professional selling account… To ensure that customers have a great shopping experience and to guard against abuse, we remove eligibility based on account performance and other risk factors

If a seller is buy box eligible, but not for a particular product or condition of a product, there are a variety of factors to consider, including listing content and completeness, performance, inventory availability, and category specific approvals. 

Multiple Buy Box Winners

One might reasonably expect that there is only one buy box winner at a time, however Amazon is increasingly allowing for multiple buy box winners at one time on any given ASIN.

Amazon will at times distinguish buy box winners by condition (allowing for both a new and used condition winner) and Prime status, allowing for one winner for Prime customers and another for non-Prime customers. A non-Prime offer will never be eligible for the Prime buy box, but a Prime offer is often both the prime and non-prime winner. 

How to win the Amazon Buy Box and become the Featured Offer

Seller and product level Buy Box and featured offer eligibility are only just the starting point for buy box. Once eligible, a seller must compete to win.

Amazon may not provide the seller with the exact algorithm to win the buy box, but they have gone a long way in making it clear which elements of a seller’s operation are important in their buy box determinations.

Every Amazon Seller should read Amazon’s article on “Becoming the Featured Offer,” which is provided below:

Becoming the Featured Offer

Featured Offers are offers for new products that we display on a product detail page with an Add to Cart button that customers can use to add items to their shopping carts. When one of your items appears in this way on a product page, we call it the Featured Offer.

There are two steps to selecting offers to feature. First, we determine which items are eligible to be featured based on criteria that are designed to give customers a great shopping experience. Second, we select compelling offers to feature from among this pool of eligible offers.

This Help topic deals with the second step, selection. To be considered for selection as the Featured Offer, first make sure that both you and your listed items are eligible. Selection then looks at a number of factors to identify the offers that customers are most likely to want, including price, availability, delivery speed, and customer service.

I. Price your items competitively

There are a few ways to check and make sure you're pricing your items competitively.

Visit the Manage Pricing page where the Featured Offer is indicated, even if it isn’t yours. See the Pricing Dashboard for real-time data about your prices and how they compare to other offers. View your pricing recommendations in the Selling Coach Pricing Report.

II. Offer faster shipping and free shipping

Sellers who offer faster shipping options are more likely to be the Featured Offer. You can look up your available options in Shipping Settings.

III. Provide great customer service

We measure customer service in several different ways, and you can check your Account Health to see how you're doing.

For example, look at metrics such as Order Defect Rate, Cancellation Rate, and Late Shipment Rate.

Staying tuned in to all aspects of your account health is a great way to ensure you are working toward becoming the Featured Offer and earning customer respect and trust.

IV. Keep stock available

You can't become the Featured Offer if you're out of stock and none is on order. Keep your inventory updated and plan accordingly for things that sell quickly.

The Amazon Selling Coach can show you low and out-of-stock inventory alerts, letting you know, in real time, when it's time to stock up.

Competition Scenarios

Legitimate Amazon Seller Competition

There is no more lucrative marketplace in the world for an ecommerce seller than Amazon. Any Seller with a desire to succeed must be prepared to deal with legitimate competition. While there are a variety of tactics available the seller wanting to limit competition, some products, categories, and sellers simply cannot avoid the King of the Hill battle. 

Maintaining a consistent awareness of competitors’ offers and having a sharp understanding of margins are necessary in order to quickly and effectively react to moves by the competition. 

Illegitimate Amazon Seller Competition

Hijackers, Counterfeiters, Leeches, Black Hatters…the nicknames are never ending. Broadly speaking, an illegitimate seller is simply just a seller with an offer on a listing that should, for one reason or another, not be in existence. 

Illegitimate sellers, if left unchecked, can have enormous impact on an Amazon Seller’s marketplace business.

  • Immediate loss of revenue

  • Rank reduction, causing future revenue loss

  • Product Review score decline

  • IPI score decline, inventory storage limitations

    • Lost sales produce slower FBA inventory turns, increased excess inventory, etc

  • Deal Eligibility

    • Hijackers can lower pricing requirements, impacting deal eligibility and pricing requirements

  • Poor Advertising Efficiency

  • Listing Content and Imagery issues

    • Titles, descriptions, and bullets can be trashed

    • Parent/child ASIN relationships can be broken or reassociated

  • Contagious

    • These issues spread horizontally and vertically - both across the assortment and by adding additional illegitimate sellers

Amazon Buy Box Best Practices

Build a Moat

Whenever possible, a seller should build a moat around its “castle” of products. Create space and make it more difficult for illegitimate sellers to attach to the listings.

Brand Registry and Legal

While not an option for every seller, Amazon Brand Registry has become more and more effective at preventing a majority of illegitimate sellers from attaching to the listings. 

If a seller has a registered and active trademark for their brand, they should apply for Brand Registry at once. 

If the Brand is not, but can be trademarked, Brand Registry through the Amazon IP Accelerator program is a great option.

Brand Website with Accurate Listings

Whether or not a seller is able to set up Brand Registry, it is valuable to have a branded site that exists as the brand’s single source of truth. 

A seller can put together a quick and simple site (Shopify), even if not transacting on the site, and manage the product content and keep it up to date. It will act as an anchor for content issues caused by illegitimate or otherwise unwanted sellers. Sellers with brands lacking Brand Registry often find great success with Amazon support when they can point to a solid content anchor.

Even if one does not own the brand, be sure to identify and document a branded source of truth for the listing content. This can often be the brand or manufacturers site in wholesale supply relationships.

Product Development

Sellers with truly distinct products see less competition than those with generic or non-unique products.

Manufacturing and selling unique product is an obvious solution, but can be intimidating due to the technical and capital requirements. The good news is that a seller doesn't need to design a product from scratch to effectively distinguish the product from existing and potential competition. 

Simply adding a logo or branding to a product is an easy and affordable way to distinguish the product. A seller’s counterfeit case has more weight with Amazon when one can demonstrate lack of branding on a product.

If a seller is working with manufacturers to sell private label products, work with them to identify small, cost effective changes to proven, existing products that they produce.  Secure exclusivity on the adjusted product - it’s often worth the extended lead time and increased MOQ.

Supply Chain Management

Transparency

The Amazon Transparency program is a great option for sellers that are experiencing issues due to counterfeit products. It can be expensive and require a more well developed supply chain and processes, but there is no more certain way to identify and prevent counterfeit product. 

Wholesale Buyer Management

For those that sell product directly or indirectly on amazon and also distribute wholesale, buyer control is critical. Amazon will not enforce MAP - the brand must enforce MAP. Be selective with wholesale buyers, have strong contracts in place, and monitor activity on Amazon for the Brand.

Control Liquidation

Amazon Sellers, especially FBA sellers, are heavily incentivized to offer aggressive sales. Whether by Lightning Deals, 7 Day Deals, Coupons, Sales, or Liquidation for IPI purposes - Amazon often wants a seller to move inventory at aggressive pricing.

Liquidation can create arbitrage, especially if not protected by Brand Registry. Limit purchases by Customer to prevent a big sale from producing unwanted future competition. 

Customer Returns Strategy

Amazon has increasingly prioritized the “used” condition product, to the point where now used products can even win the buy box. This is in part due to the abundance of “used” inventory in the FBA network due to returns and Amazon’s desire to remove it. 

Sellers with experience with FBA inventory have likely noticed “Amazon Warehouse Deals” pop up with used offers on listings to move the inventory that has accumulated on the product. But Amazon also frequently liquidates returned product to buyers that are also 3rd Party Amazon sellers? 

Many sellers have seen an increase in “Used - Sold Like New” product quality issues. These are often a result of liquidators selling returned product as new, producing customer complaints. These issues can bring a listing down and often seem to happen on the most profitable products. 

While dealing with FBA removals can be a nightmare, if a seller is experiencing issues due to liquidated inventory, consider doing regular removals so that the seller takes possession of the inventory. 

Maintain Visibility and Act Quickly

Brand Registered or not, a successful seller must maintain constant awareness of buy box issues.

Amazon buy box issues aren’t just costly, they also have inertia - the longer they persist the more difficult they become to overcome. This compounding consequence requires a high level of awareness in order to quickly act and resolve the issue.

Software Systems and Processes

Software Systems

Even with small assortments and limited SKU counts, it is impossible to maintain awareness of buy box status without software assistance. Those that already use buy box monitoring or buy box alert software know that the buy box changes are often incomplete, inaccurate, or simply just hard to consume and understand.

Market Labs Amazon Alerts gives the seller confidence knowing that their listings are constantly monitored and provides the seller comprehensive, flexible, and informative alerts and analytics that equip the seller to make smarter and faster decisions.

How much of a feature pitch are we making here? At what point do we just link to the landing page for the product (or wherever we would start a flow). 

Processes

Once an illegitimate seller is identified, there is no more effective play than to make a test buy, physically evaluate the product, and document the findings. Because time is of the essence, we suggest immediately executing the test buy upon the alert indicating the illegitimate seller. 


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