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Amazon Buy Box: Consider These Important Influencing Factors


Luis Frahm explains the factors involved behind the Buy Box algorithm and how you can influence them

Amazon Buy Box: Consider These Important Influencing Factors
To ensure the simplicity of the platform, there is only one product detail page for each product on Amazon. In other words: one European Article Number = one Amazon Standard Identification Number. All sellers of the same product are attached to this page with their offer and compete there for the shopping cart field, also called the Buy Box. The crux of the matter is that the vast majority of sales are made exactly through this field. Suppliers who are unable to position themselves there lose valuable sales as a result.

What is the Amazon Buy Box?

Let’s start with the basics. The Buy Box is the white box with the shopping cart field on the right side of the product detail page. It contains all the important information about price, the seller and shipping. With a simple click, the desired item lands directly in the shopping cart of an Amazon user.

Only one supplier occupies the much-desired first place and becomes the Buy Box owner. Though fear not, other suppliers can also be displayed in places two through four. Thus, if an Amazon user wants to go even deeper when researching the product, they can use the link below to display a list of all suppliers who currently sell it.

How Amazon decides who wins or loses the Buy Box

Not all sellers meet the requirements to be in the Buy Box. The Buy Box algorithm analyses vendors according to various influencing components and decides who wins the Buy Box based on these factors. Below you can find a few of the most important factors but keep in mind that there are other aspects that Amazon will take into account:

What is the goal of the Buy Box algorithm?

The more criteria you meet, the higher the chance of taking first place and becoming the Buy Box owner. Amazon wants to give users the best value for their money. So, if, for example, a seller offers a lower price, they may well become the Buy Box owner as a result − provided they offer comparatively attractive delivery conditions. However, if customers are forced to accept longer delivery times from the same supplier, it can happen that a competitor with a higher selling price but shorter delivery time ends up being the winner.

For vendors’ products to be sold, Amazon must occupy the Buy Box. Vendors must lay the groundwork for this to be possible. Unlike sellers, they can only indirectly influence this. Sellers, on the other hand, have the option to define their own sales prices.

One of the important influencing factors that vendors can control is: availability of their products. They can also offer Amazon purchasing conditions that allow the retail giant to reduce prices up to a certain point (the keyword here is profitability).

It is important to understand that Amazon is using automated price adjustments to remain competitive. Dynamic price matching compares different sources inside and outside Amazon and automatically determines the online market price.

Why should sellers use repricing tools?

Sellers, too, can rely on appropriate software solutions in order to fill the Buy Box. The more providers there are in the Buy Box pool, the higher the price pressure. The so-called repricing tools can make it easier for sellers to deal with the Buy Box.

With these tools, you can set both minimum and maximum prices. The amount by which you want to undercut a competitor can also be specified. As soon as the selling price changes, your own price is automatically adjusted, and the item is offered at the previously defined lower price.

Own the box

It is well known that Amazon users usually buy their desired products via the shopping cart field. Only a select few compare other offers before checking out with the selected seller. Thus, by keeping certain aspects in mind, you can own the Buy Box and by using repricing tools you can keep a competitive edge, provided you keep profitability in mind. Also, vendors should pursue the goal of letting Amazon win the Buy Box for their items. 

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Categories: E-Commerce Platforms, Retail and Restaurants

DEPT®, Mon, 17 Jun 2019 08:55:33 GMT