How to be price competitive using Amazon Pricing Tool for your Vendor Central or Seller Central Listings? How to ensure you win the buy box on Amazon?

What is Amazon Buy Box?

The Buy Box is where you click “Buy Now” or Add to Cart Button” on the right side of your product detail page. Whenever a customer clicks on any of these two buttons, they are buying from the offer that is winning the buy box. Most customers buy products directly using the Buy Box without considering the other offers. The data says 80% of the sales happen through the buy box and the remaining happens through the other sellers who don’t have the buy box. 

What factors determine who wins the Buy box?

If you are a vendor selling the products directly to Amazon, then you don’t have to worry about winning the buy box because Amazon uses their Competitive Intelligence to readjust the pricing and ensure they win the buy box 99% of the time. However, there is always a lot of competition to win the buy box among the sellers as that is the driving factor for converting a sale. 

If you are a seller on Amazon, then the following factors are to be considered for your offer to win the buy box

1. Inventory – This is one of the key factors that determine the buy box. If you don’t have inventory, you don’t have an active offer. Amazon also keeps a track of your product availability and based on that Amazon determines the possibility of allocating the buy box.

2. Is your item FBA? - This is one of the most important requirements because you will be using Amazon’s prowess of shipping to the customers within a day or two and by that, you are getting the prime Tag too.

3. Product Pricing – It is not alone important to be price competitive not within Amazon, but also with external Marketplaces such as Walmart, Target, etc. Amazon uses its competitive intelligence to understand if the price at which you are offering the product is the cheapest or not.

4. Seller Feedback / Customer Service Performance – Amazon keeps track of your Order Defect Rate, which includes Negative Feedback, A-Z Guarantee Claims, Chargeback Claims. Though it is not exactly clear on what is the allowable %, this is one of the key metrics that determine Buy box to you as a seller.

How to use Amazon’s Repricing to win the buy box as a seller?

If you are a seller on Amazon, then you can reprice the product either by manually adjusting it or you can use Amazon’s Rule-based Automated Pricing option. Manually adjusting the price may be tough because it needs constant monitoring on the price that is winning the buy box. Hence it is advised to use Amazon’s Automate Pricing option where you can match the price using the 4 types mentioned below.

· Competitive Buy Box

· Competitive Lowest Price 

· Competitive External Price

· Based on Sales Units

In this, we will recommend you to use the Competitive Buy Box rule and the marketplace that you would want the repricing to be automated and use our recommendation below to reprice your items. 

Which pricing action do you want Amazon to take?

Use the option to stay below the buy box price by a cent ($0.01)

Which type of offers do you want to compare to on Amazon?

All offers on Amazon for the same ASIN and condition

Do you also want to compare with prices that are off Amazon?

Yes – This is important to win the buy box as Amazon suppresses the buy box if the price offered on Amazon is more than the price in a different marketplace

Do you want to continue repricing if you update your price elsewhere in Seller Central?

No, I want to pause repricing – This is because you don’t want to contradict information in multiple places which might have a downstream impact when you do a reconciliation of your sales. 

Once the above items are set, you must update the Minimum Price and Maximum Price and then assign the rule that you have created for the Automated Pricing to work. 

Blog Post by Giri Prasad

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