I get asked this one question all the time by people who are interested in selling on Amazon.
It’s a completely understandable question that even I wanted to know the answer to before I began my store.
If you are selling products on Amazon, how do you actually make sales?
How do you ensure that people choose to buy from you over the countless other sellers that are also on the platform?
How can you compete against a giant such as Amazon itself?
The answer is quite simple.
In order to generate sales on Amazon, it is important that you understand the concept of the buy box.
The buy box is the area on the right side of an Amazon product page where it shows the price, the delivery date and has options to “Add to Cart” and “Buy Now”.
The vast majority of Amazon sales take place in the buy box.
In fact, in order to generate sales, your main focus should be on winning the buy box.
How can you win the buy box?
It’s very simple.
When you match the buy box price, Amazon will rotate you in with other sellers who have the same buy box price.
It is through this buy box rotation that your offer is seen by customers and they click buy.
Customers do not even realize they are buying from a third party seller most of the time.
They believe that they are purchasing directly from Amazon.
Amazon needs third party sellers like you and me in order to provide a large catalog of products to their customers at highly competitive prices.
Match the buy box price and you will win the buy box a percentage of the time.
The only factor you need to consider when sourcing a product is if Amazon is on a listing and if they share the buy box.
I will dive into this deeper later on in this article.
The buy box will prioritize the featured offer based on a variety of factors.
Here are some off the top of my head:
- Which seller is located closest to the buyer?
- Which seller offers the fastest shipping and handling times?
- Does Amazon sell this product themselves?
- Is it FBA or FBM? FBA (fulfilled-by-Amazon) will generally be favored over FBM (fulfilled-by-merchant) unless FBM can deliver faster than FBA (which is the case during the holiday rush)
- Who has the best customer feedback?
- Who has the least amount of order defects?
- Who has the best sales history?
You don’t need to worry too much about this list.
Focus on sending in profitable, fast selling products on a consistent basis to Amazon and you will generate sales.
Over time, you will generate positive reviews and be able to remove negative feedback for FBA orders.
This will increase the credibility of your account, and as you begin to increase your sales, your buy box wins will increase.
Even a brand new seller that has no feedback and no sales can hop on Amazon listings and start to generate tons of sales.
It worked for me and plenty of people who I have helped.
Grant Cardone said in his book 10X, “Feed the Beast”.
If you want 10X results on Amazon, you need to feed the beast.
That means sending in 10 times more products than you think it will take in order to generate the sales that you are looking for.
Let’s now discuss the concept of buy box ownership.
Every product has a percentage split of who owns the buy box at any given moment.
This data is tracked by a website called Keepa (www.keepa.com), which is an indispensable tool for Amazon sellers and especially retail arbitrage sellers.
Even though SellerAmp has its own Keepa charts included, they lack the ability to check buy box statistics.
Here is how to check the buy box statistics for a given product:
1. Open Keepa
2. Click on Data -> Buy Box Statistics
This is the one page that I use religiously in order to make sure that I can move my units.
This one page of data alone is worth the subscription of Keepa.
You want to pay attention to the left most column which says % won.
This shows you the percentage of buy box sales that a particular seller has won.
Often, Amazon will also be on this list.
You want to avoid items where Amazon sells it 100% of the time.
This means you’ll likely never be able to sell your product.
I generally like to sell products where Amazon sells it less than 85% of the time, but there are some sellers who do 25% or less.
Others refuse to sell on any listing that Amazon is on.
That being said, I’ve sold products that Amazon sold 99% of the time.
When looking at this page, you’ll also want to check the Avg. price column.
This will tell you what those other sellers were selling it for.
This can help you gauge if the price you are trying to sell your product for is realistic and if other sellers have been able to sell it at that price too.
Next, you want to change the date range from 30 days, 90 days, 180 days to 365 days.
Take a look at the buy box statistics over a variety of date ranges.
This will give you a more accurate representation of the buy box percentages and average prices over time.
There are certain products that Amazon sells, but they run out of stock.
Through this tool, you can see how frequently they are in stock and what other sellers sell the product for once they go out of stock.
The price generally tends to increase when Amazon goes out of stock because Amazon can sell products for cheaper than 3rd party sellers typically can.
If you do your due dilligence and check the buy box statistics before purchasing a product, you won’t run into the issue of not being able to sell your products because Amazon doesn’t share the buy box.
That means that all you need to focus on is sourcing your product cheaply and matching the buy box competitively.
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