What Is The Buy Box And How Does Amazon Decide Who Gets It
When browsing on Amazon, customers will navigate to a products main page and click on the offers links below the product description to see a list of available sellers.
However, Amazon also gives merchants the ability to compete for the coveted Buy Box the CTA button in that familiar shade of yellow. are made via the Buy Box – that’s 90% of total sales volume, so it’s imperative for any aspiring Amazon merchant to understand what the buy box is and how it works.
This is the Buy Box, which drives 90% of sales.
The Buy Box is the box on a product detail page where customers can begin the purchasing process by adding items to their shopping carts. Rather than looking through a list of available merchants, the Buy Box allows customers to quickly purchase a product from the Featured Seller – the business Amazon has chosen to receive the bulk of sales.
Because a key feature of the Amazon platform is that multiple sellers can offer the same product, becoming the featured seller who wins the Buy Box is very difficult. In fact, its pretty unrealistic to think that your site is ever going to get ranked high enough to become the featured seller.
In order to be eligible for the buy box, you must meet the following four criteria:
There are separate Buy Boxes for new and used products. Used products are not eligible to be featured in the Buy Box, and new products are not eligible to be featured in the Buy Used Box.
The Buy Box vs. the Used Buy Box.
Its Your Responsibility To Secure Distribution
Amazon makes clear that it is exclusively the responsibility of the brand to secure its distribution.
Namely, Amazon will rarely get involved in helping brands remove unauthorized resellers, thereby allowing anyone to sell any product on Amazon, as long as it is a legitimate product where no harm is inflicted on the Amazon customer.
What To Sell On Amazon Fba
Regarding what to sell on , its crucial to remember that its a price-driven marketplace. This means that people visit the website to find the best deal. Thus, your products must be attractive to your target audience and often in a particular price range.
When selling on Amazon FBA, the criteria for the products you choose to sell remain the same as when you sell on Amazon and manage and ship orders yourself.
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Become An Amazon Affiliate
Affiliate marketing is a brilliant way to make some passive income if you have a blog or website that generates a decent volume of traffic.
Become an and earn a commission by putting special affiliate links to various Amazon products on your site.
The idea is to promote products that align with your blog or websites mission. So, if you have a website about how to travel efficiently, you may promote items such as packing cubes, sturdy suitcases or wrinkle-free clothing.
Each time someone who comes through your website clicks on the affiliate link, youll earn some money. You can earn anywhere from 4% to 8.5% of a sale.
Keep in mind that commissions are generally really low, which is why you need a significant amount of traffic to your site.
The more page views you have, the more chances are that the links will get clicks. No traffic means no chance that anyone will see those links to be clicked on.
Amazon offers a progressive earnings structure on the majority of merchandise and the more clicks and purchases you get from your site, the more you can make.
Think About Whether To Ship Products Yourself Or Use Fulfilllment By Amazon
You have two options when it comes to shipping your products.
- Fulfilllment by Amazon will cost you money. But if you choose this option, Amazon will handle warehousing, shipping and returns for you.
- If you prefer to do your own fulfilllment, you might save some money. But it may deter Amazon Prime customers from buying because they will be charged for shipping and handling.
As with all selling decisions, use accounting software to test each scenario. That will help you decide which option is more profitable.
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Top Selling Products Based On Amazon Best Sellers Page
A good starting point for identifying top selling items on Amazon is a list of current best-sellers that the platform itself curates. You can find best seller lists for international marketplaces, including the USA, the UK, Canada, Spain or Germany.
These lists show items that are selling the most across the entire site. They show the most popular products per category, ranging from toys to books to video games.
Amazons Best Seller list is updated hourly. Check out the screenshot below to see what was popular at the time when we started working on this article in March.
However, when using Amazons best seller lists, be aware that:
- Products found on the best sellers page can be very competitive: after all, every seller has access to this information.
- Sales of particular products might be trending down, which means you could jump in just as the product stops being in high demand.
- Some top selling products might not have great sales margins and be profitable.
All the same, we encourage you to pay attention to what sells best and is trending. You might want to get ideas for similar products and also look at the Customers also bought section. This can give you ideas to adjust your product portfolio in a way that will grow your ecommerce business on unprecedented levels.
When youve identified products with potential, you can track down suppliers that will provide you with those same products or come up with new variations to gain competitive advantage.
Amazon Sponsored Product Ads
Another way you can get more exposure for your items is to use Amazon Sponsored Product ads. This is an optional service that allows you to pay for additional exposure to generate more sales.
Amazon Sponsored Products show up in both search results and on product pages.
Amazon provides the ability to run automatic campaigns and manual campaigns. In an automatic campaign you set the bid amounts, set your budget, pick the products you want to advertise, and then Amazon will choose the targeting for you. If you run a manual campaign, then you will choose your own targeting options.
You can learn more about in our guide:
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How To Sell On Amazon For Beginners In 2021
Amazon is a popular platform for both sellers and shoppers. To cope with the rising demands of the sellers, it has rolled out its FBA service. This service allows sellers to leverage the platforms powerful distribution network and customer base to make their business dream come true. For retailers, its the most popular choice of platform.
FBA stands for Fulfillment by Amazon which means Amazon will store your products in the Amazon inventory, fulfill your orders, and offer customer service. If you want to use the Amazon FBA service, you have to create an Amazon seller account and add FBA to your account. Its important that you set your business up in compliance with the guidelines on the website.
Create your product listings and inventory or integrate your inventory data into the Amazon platform. Prepare the products to be delivered, and send your products into Amazon warehouse. When the customer places orders, Amazon FBA will fulfill the orders and send all necessary shipping and tracking info to the customers. 24/7 customer service is available for both sellers and customers.
As a seller, you will be free from the processes attached to inventory, packing and shipping orders. This system means its quite easy for you to get started. Amazons robust FBA model supports and allows you to scale your business globally too. Besides, if you are an Amazon FBA seller, you are qualified for free shipping on orders over $25 and $49.
The Gray Market First Sale Doctrine And Your Business Rights
The reality is that there are a lot of very sophisticated gray-market sellers on Amazon and they dont scare easily.
They all have legal representation and they know how to play the game of whats known as first sale doctrine.
First sale doctrine is a legal concept that says anybody in this country has the right to buy a product and then turn around and resell it.
These sophisticated gray-market sellers know that they have legal protection thanks to the first sale doctrine, so you have to become more sophisticated as a brand if you want to protect your ability to control distribution.
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Apply To Amazon Handmade
In addition to dominating the selling marketplace, if you make and sell handmade items, like bags or jewelry, you can try selling your wares on Amazon Handmade.
The marketplace directly competes with Etsy and eBay.
There are pros and cons to using Handmade. For one, the general reach is large, and their commission fee reflects that.
Handmades fees are much higher than Etsy, as they charge 15% commissions and a $1 minimum referral fee, while Etsy charges a 3.5% commission and 20-cent item listing fee.
Obviously, youre paying a higher price for Amazons massive, worldwide audience, but your profit margins will be lower.
If you make and sell handmade items, you can apply to join Handmade, as long as your products fall under certain categories.
Items must be made entirely by hand, hand-altered or hand assembled and handmade by you or by one of your employees.
Their rules are strict, so make sure you check out requirements to be approved.
Pricing Strategies On Amazon
The way you price your items on Amazon will have a huge impact on your profitability. After the items you source, pricing is the next most important factor in my opinion.
My default recommendation with pricing is to price in line with the competition if there are other sellers on the same listing.
To do this, find the lowest price offer using the same fulfillment method that you will be using, then match their price or add 1%.
For example, if there is a seller on a listing at $49.99 selling the item FBA, and you will be selling the item via FBA as well, I would price between $49.99 and $50.49.
When you set your price to match or price above the other sellers on the listing, you avoid something known as the race to the bottom. The race to the bottom happens when multiple sellers on the listing are constantly trying to be the lowest price on the listing. This can turn into an endless battle and erode all of the potential margin.
An example of how this goes:
Seller 1 is priced at $19.99, seller 2 prices at $19.95, seller 1 lowers their price to $19.89, seller 2 lowers their price to $19.75, and on and on, and before you know it there is very little margin left.
Pricing at or a bit above the competition helps to maximize the margins you will see on sales.
Here are some other tips I recommend when you are pricing on Amazon:
These tips should help you to get started pricing in a way that will generate sales and will maximize your profits.
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Get A Trademark To Overcome First Sale Doctrine
One important way to overcome first sale doctrine is to modify the way you enforce trademark.
You can structure your trademark so that its not just the name of your brand, but its actually how the product is handledhow it gets moved from retailer to consumer.
There are about 75 different ways that trademark can be defined and enforced.
If you can show that there is potentially a trademark issue, you can get a court to rule in your favor and be able to overcome first sale doctrine as a legitimate means by which an unauthorized seller can sell your products on the Marketplace.
When you tighten up control of your trademark, you can:
- Better control distribution and not have to rely on sending those nasty cease-and-desist letters to unauthorized sellers.
- Demonstrate that the continued selling of your products without authorization actually represents a legal issue.
The resellers are illegally selling your products and cant hide behind first sale doctrine.
Managing trademark and continuing to police it is a cost of doing business. You have to put the right kind of online reseller policy in place, and it has to include anti-diversion language that says resellers or retailers dont have the right to sell the product to unauthorized resellers.
How Does Amazon Determine The Order Of The Merchant Offers List
Even if you never win the Boy Box listing, you can still make money selling on Amazon by selling through the Merchant Offers List. fall in line with ecommerce best practices, so its in your best interest to be doing these things anyway.
A number of factors affect where a merchant appears in the Offers List, including:
As a general rule of thumb, the most effective solution is to ensure that any transactions you receive through Amazon run as smoothly as possible. That means delivering your product in a timely manner and communicating with your customers along the way. However, if youre looking to break into the market a little quicker, here are two shortcuts that can help:
Start by selling a low-competition item to boost your seller ranking. This will increase the probability that the offer will show higher for more competitive products. When selling low-competition items, look for products that have few reviews and focus on becoming the seller with the most positive reviews for that product. Building up the total number of reviews on your Amazon Seller account will increase your legitimacy as a seller, and will help you break into higher-competition niches.
Try offering a very competitive price on a popular product. This draws in bargain shoppers and can increase your seller ranking. You can check out Amazon’s “Most Wished For” list to see the most popular items by industry if you need some inspiration.
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Deliver With Amazon Flex
Youve probably realized by now that Amazon runs its own delivery service. Im sure youve seen drivers delivering packages around your neighborhood and even to your own door.
If youre looking for a part-time job, you can become one of those drivers through .
The majority of drivers earn between $18-$25 per hour. All of your earnings can be tracked through the Amazon Flex mobile app.
As the name implies, the position is flexible. Create your own schedule with available opportunities seven days per week.
It Requires Effort And Hard Work
Just because youve got a small handful of moneymakers doesnt mean the games over and you can relax. In fact, far from it. Now that youve hit upon a little bit of success, its time to dig your teeth in even more firmly.
Youve shown a knack for finding SKUs that are good profit-earners, and youve got to keep diversifying your inventory. Your biggest earners wont always be that way and if you can find other SKUs to handily step into place after, youll be setting yourself up nicely for the future.
Introduce new items slowly by starting off with your existing brands and suppliers to keep an edge of familiarity in place.
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Create Your Product Listings On Amazon
As an Amazon seller, you can create product listings in two wayseither add your items to existing product listings or create a new product listing for an item. Either way, youll want your product to show up in the top results when customers search for it. With keyword research, youll know the exact words potential customers type in when looking for a product like yours.
Sellics is an all-in-one Amazon software that offers a free keyword research tool. You can either add the keywords Sellics finds to your product listings yourself or use the software to help you optimize and scale your Amazon store. .
Adding items to existing listings is by far the easiest of the two, and this is how most new sellers get started on Amazon. So well begin here.
Is An Amazon Business Right For You
So, now that you have the basic knowledge on how to choose profitable products and even how to get started on Amazon, is an Amazon business right for you?
When deciding if pursuing an Amazon business is the right route to take, you should know that selling on Amazon provides a great way to get started selling online. This is especially true if you dont want to deal with technology.
Selling on Amazon, whether handling the duties yourself or using Amazon FBA, will be the most beneficial if you can introduce a product that has a differentiated feature.
That is, until Jeff Bezos finds your product.
Remember How Jeff Bezos Admitted Amazon Sellers Were Kicking His Butt in 2018?
Remember the letter from Jeff Bezos to shareowners shown earlier in this article where he said Amazon third party sellers were kicking the first party sellers butt? If not, heres a reminder:
Well, heres how he responded to the competition that prompted him to say this.
Shortly after that admission, Amazon added 157 private label brands. This addition brought the total number to 450.
When it comes to his bank account, that man doesnt mess around!
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Manage Your Inventory On Amazon
Managing inventory accurately is key to your success on Amazon. Amazon will lower your Seller Rating for not shipping an order for an item that you show in-stock. Like product listings above, you have several choices when it comes to inventory management. Whichever method you choose, keep inventory updated to keep your Amazon seller ratings high.
Note, Amazon automatically reduces your inventory count as your Amazon items sell. If you sell only on Amazon, this should keep your counts correct. But if you sell the same stock on your own website or in a retail store, youll probably need a better solution.