Marketplaces are platforms whose model mostly consists of putting sellers in competition with each other. As a merchant, the question arises: how can I be better than my competitors and win more sales? The answer: by getting Buy Boxes. In this article, we reveal 4 levers you can use to earn and, above all, keep Buy Box marketplace sales.
Marketplace means visibility and competition.
- Visibility, because it represents a real showcase for merchants who want to develop their clientele and their business quickly and on a controlled budget.
- Competition, because merchants compete for this visibility through Buy Boxes, which win an average of 82% of sales.
The Buy Box corresponds to the “add to cart” button found on most marketplaces (e.g. amazon, cdiscount…). The more Buy Boxes you get as a merchant, the more visible you’ll be.
The bottom line is that visibility on marketplaces is relative, and depends on your ability to get Buy Boxes. So how do you get Buy Box marketplace? How do you qualify for a buy box, and what are the conditions for obtaining one? In this article, discover 4 actionable tips to maximize your chances of getting Buy Boxes, without sacrificing your margins!
What is the Buy Box?
The Buy Box is the little “add to cart” button, yellow on Amazon or green on Cdiscount, found on the product sheets and product lists of most marketplaces (except Ebay).
Most of them, because not all marketplaces use this Buy Box system. This is the case, for example, of Etsy, which offers customized and therefore unique products for sale. Its aim is to prioritize one merchant’s offer over another. This will enable it to be the most visible on the product page (90% visibility, see below).
Since most buyers don’t make the effort to check out what other sellers are offering on the product, most of the time, merchants who don’t win the Buy Box lose sales. The word “win” is perfectly appropriate, as this is a real competition between merchants.
But this emphasis is no accident. Quite the contrary, in fact!
Although marketplaces don’t disclose their Buy Box marketplace attribution rules, what we do know is that an algorithm is programmed to choose sellers who meet certain criteria.To learn more about the best strategies and tools for maximizing your chances, check out our article on 5 tools for selling on marketplaces.
Plus, for an overview, explore our marketplace panorama and discover how French marketplaces for sale can be integrated into your e-commerce strategy.
Since most buyers don’t make the effort to check out what other sellers are offering on the product, most of the time, merchants who don’t win the buy box lose sales. The word “win” is perfectly appropriate, as this is a real competition between merchants.
But this emphasis is no accident. Quite the contrary, in fact!
Although marketplaces don’t disclose their buy box marketplace attribution rules, what we do know is that an algorithm is programmed to select sellers. The main criterion used is the customer’s buying experience (price, seller rating, number of reviews, customer service, delivery speed, etc.) And yes, the Buy Box is a tool that the Marketplace uses to offer the best possible satisfaction and experience to its consumers! For this, there’s no choice: it’s imperative to develop an impeccable logistics strategy. And coupled with a pricing strategy, it’s even better!
Tip #1 for a Buy Box marketplace: minimize your shipping times
The key to being visible and winning Buy Box marketplace business is undoubtedly logistics. This is surely the most important variable taken into account by marketplaces.
In order to offer the best possible experience to the end consumer, marketplaces expect merchants to prepare and deliver their products as quickly as possible (ideally within 24/48 hours).This level of performance is reflected in a number of key indicators for merchants. We will group these indicators into two different categories:
The first is the promise of preparation:
- Shipping Time: This is the time announced by the merchant to ship the product to the consumer. The shorter this time, the greater your chances of getting Buy Boxes! That’s why it’s so important to keep shipping times as short as possible.
- Late Shipment Rate: The late shipment rate corresponds to all orders for which shipment confirmation is made after the estimated shipment date. It is calculated in relation to the total number of orders placed over a given period (10 or 30 days for Amazon).
The second is the promise of transport:
- On-time Delivery rate: This metric indicates the percentage of shipped packages that buyers have received by the estimated delivery date. In fact, it’s how well customer promises are kept!
Buy Box marketplace tip #2: monitor your performance indicators
In addition, your other sales metrics must be excellent to give yourself the best chance of winning the Buy Box!
- Order Defect Rate (ODR): the order defect rate is calculated by taking the number of orders with one or more defects divided by the total number of orders over a given period. It is used in particular in the allocation of Buy Boxes on Amazon.
- Marketplaces take three factors into account when calculating this rate:
- Claims from A to Z
- Negative comments from the seller
- Back billing
- Inventory Index: winning one or more Buy Boxes by having products that are frequently out of stock is highly unlikely! The marketplace will always favor a seller who has enough stock to satisfy consumer demand. To ensure that your stock is always up to date, make sure you :
- Carry out inventories on a recurring basis.
- Optimize your inventory management. Equip yourself with stock management software that links your warehouses and sales channels. It will update your inventory in real time and help you avoid out-of-stock sales. This is one of the key features offered by Shippingbo e-commerce logistics technology.
- Cancellation Rate: the cancellation rate before processing corresponds to order cancellations initiated by the seller only on the total number of orders placed during a given period (7 days for Amazon, for example).
- Refund Rate: The refund rate corresponds to all refunds requested by the consumer (for whatever reason), out of the total number of orders during a given period.
- Customer Response Time: Customer response time is the time it takes to respond to customer requests.
- Feedback Score: This score corresponds to the reviews left by customers about your service. These reviews are accompanied by a 5-star rating. The Feedback Score is calculated as the sum of all positive customer reviews over a given period (30, 90 and 365 days, and since the creation of the Amazon seller account). The Amazon and Cdiscount marketplaces use this star system and rate them as follows:
- Positive rating: 4 or 5 stars
- Neutral rating: 3 stars
- Negative rating: 1 or 2 star(s)
- Feedback Count: This is the number of reviews left by customers. The higher the number of reviews, the better your chances of getting the Buy Box!
Tip no. 3 for a Buy Box marketplace: offer best-price shipping deals
To obtain the Buy Box, Marketplaces take into account your prices, including transport. The result is that the price of transport, whether separate or included in the price of the product, must be competitive!
Shippingbo gives you access to ultra-discounted transport rates, so you can offer transport services at the best possible price (even when you don’t do much volume). How can you do this? Thanks to our network of resellers who offer merchants preferential transport rates ! Through Shippingbo, our customers can benefit from direct contact with commission agents and take advantage of their negotiated rates, without intermediaries or commissions.
Tip #4 for a Buy Box marketplace: automate pricing
The price of your offers is your most immediate and fastest lever for winning Buy Box marketplace. Your ideal price: the one that wins the Buy Box with the highest possible margin, within your acceptable price range.
Your most successful competitors have probably already adopted automated pricing. With repricing software, they react – more or less quickly – to price changes made by you and other merchants.
If you haven’t used repricing software yet, Multiply is an excellent choice! It helps many of our customers automate their pricing on marketplaces.
In this section, we take a look at common pricing strategies for marketplaces.
Winning pricing strategies:
- A specific price for each channel:
Each sales channel imposes its own specific distribution costs (in particular, marketplaces’ commissions) and competitive environment.
Quick tip: to maximize sales and margins, adopt a separate price for each SKU on each channel. - Optimal choice of target price:
Repricing software with intelligent pricing algorithms will observe the marketplace’s reaction to each price change, increasing its understanding of the forces at work on your offers before proposing a new price. The software then automatically applies the new price, as long as it falls within your acceptable price range.
- Reactivity:
If the right price is one of the two key success factors in repricing, speed is the other.
Please note: each marketplace is different in terms of the maximum speed you can expect. For example, on Amazon, each merchant is generally limited to 30 price updates per hour – with no limit on the number of SKUs in each update. Choose the right terminals:
Our recommendation: model your marginal costs in detail (purchase price, logistics costs, commissions, etc.) and define a margin threshold. Don’t forget to take into account the impact of returns, which can have a significant impact on the final amount. As for your maximum prices, which come into play in particular on your SKUs without competitors, you can align them with the prices of your main store or the off-marketplace.
Conclusion
To find out which pricing strategies you should avoid when managing your prices, download our white paper dedicated to visibility on marketplaces.
To be more visible than your competitors on marketplaces [and win the buy box], you know what you have to do: be better! This applies to both logistics and pricing. And, of course, by surrounding yourself with the right technologies!
