Sell Smarter on Amazon: The Metrics You Need to be Tracking

Sell Smarter on Amazon:

The Metrics You Need

to be Tracking

Table of Contents

Introduction

Tracking Data Starts With Identifying

Your Account Type

How Data Impacts Growth on Amazon

Product Ranking

Buy Box Placement

Product Reviews and Seller Ratings

Tracking Data and Adhering to Benchmarks

Business Report

Inventory Report

Seller Performance Report

What If You’re Not Meeting These Benchmarks

Low Conversion Rate

Low Product Availability

Poor Performance Metrics

Low Seller Rating

Metrics & Benchmark Wrap-Up

Using Numbers to Grow Your Amazon Business

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Introduction

Every ecommerce seller knows the rule — utilize your data to increase

sales. Though everyone may have heard this rule, not everyone knows how

to use data to increase their revenue. With so many metrics to track, it can

be difficult to know which ones to focus on and improve.

Sellers on Amazon who want to boost their revenue have to consider a

unique set of data. Their account metrics don’t just indicate sales numbers

— they also directly impact how these sellers are positioned in Amazon’s

marketplace. A high order rate, for example, doesn’t just mean greater

revenue — it could also mean more product reviews, better Buy Box

placement, and ranking high in product searches. Data determines how

buyers perceive sellers and their products on Amazon, so merchants have

to track their metrics to ensure that they’re set up to stay successful on the

platform.

This ebook will help you understand which metrics you need to be tracking

on Amazon, and how to use data from the marketplace to grow and

strengthen your business.

We hope you find it useful!

- The makers of Sellbrite

Tracking Data Starts

With Identifying Your

Account Type

When you sign up to sell on Amazon, you register either as an Individual

seller or a Professional seller. The account type you choose determines

the data available to you as a seller.

Individual Amazon sellers have less data access than Professional sellers.

They can only access the:

• Payment report

• Return reports

• Tax Document Library reports

• Seller performance metric

Tracking Data Starts With Identifying Your Account Type

www.sellbrite.com

Professional sellers have access to all of these Individual seller metrics in

addition to Business and Inventory reports, which provide key insights on

sales, traffic, and the stock status of products.

[Source]

The Individual account does cost less upfront than the Professional account.

Individual sellers only have to pay a $.99 fee for each item that sells, while

Professional sellers have to pay a $39.99 monthly fee.

With this fee structure, Individual accounts are cost-effective for merchants

selling less than 40 items. If a merchant sells more than 40 items each

month, they should opt for the Professional account. At that point it’s more

cost effective—and also provides data insights from the Business and

Inventory reports.

How Data Impacts

Growth on Amazon

When buyers visit Amazon, their likelihood of engaging with a seller

depends on the merchant’s:

• Product Ranking: the point at which the product appears in search results

• Buy Box Placement: whether the seller’s product made the Buy Box or not

• Product Reviews and Seller Ratings: how many product reviews and seller

ratings the merchant has and how positive or negative this feedback is.

By knowing which metrics affect each factor, sellers can attract the attention

of more customers and build relationships with repeat customers.

Product ranking

According to One Click Retail, over 80% of people never go past the first

page search and 64% click one of the top three results. Your product

ranking has a huge impact on whether a customer engages with your

product or not.

Amazon has not released information on their product ranking algorithm, so

no one can definitively say what is needed to rank high on the marketplace.

However, the Amazon search engine A9 does provide a few clues on their

website. For example, A9 explains how, for the search “Harry Potter in

books,” they would break the search down by keywords. In regards to data,

A9 offers no clear insights other than stressing that they provide “the most

relevant results” to the users.

How Data Impacts Growth on Amazon

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Most Amazon sellers interpret “relevant” here to mean the results that the

buyer is most likely to purchase, leading merchants to believe that their

unit session percentage rates (conversion rates) affect product rankings.

If many people are buying a product (and the item’s keywords match with

the buyer’s interests), there’s a good chance that buyer will want to make a

purchase as well.

The two main components of conversion rate are sales and traffic rates,

so these two metrics also impact product ranking and should be tracked.

Amazon defines sales as the number of units ordered and traffic as the

number of sessions. Sessions are visits to your product page within a 24-

hour period. Multiple views within 24 hours only count as one session.

Buy Box placement

When you’re sharing an Amazon listing with a seller offering the same

product, winning the sale is all about winning the Buy Box.

The Buy Box is the first price option a buyer sees when they view an

Amazon listing. If a buyer clicks “Add to Cart,” they are purchasing the offer

in the Buy Box.

How Data Impacts Growth on Amazon

The Buy Box’s prime visibility increases sellers’ chances of engaging with

customers. To get a sense of the feature’s value, consider that 82% of all

Amazon sales happen through the Buy Box.

Buy Box eligibility and winning is determined through a variety of data

factors. Eligibility is determined by considering sellers’ performance

metrics with Order Defect Rate (ODR) being the most important

performance factor. Amazon also considers customers’ shopping

experience when determining Buy Box eligibility. Stock statuses

are assessed to determine whether products are available for buyers,

and seller ratings are reviewed as a measure of customers service.

Sellers who want to check whether products are Buy Box eligible can

click Manage Inventory, select Preferences, choose “Buy Box Eligible”

as a displayed column, and save changes.

[Source]

How Data Impacts Growth on Amazon

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Winning the Buy Box, according to Amazon, mainly depends on product

pricing and availability. While there isn’t an Amazon metric for price

competitiveness, sellers can view the Buy Box percentage metric to

see the percentage of times their product was placed in the Buy Box.

Sellers can also improve their chances of winning by reviewing inventory

metrics since availability is considered.

Product reviews and seller ratings

Since online shoppers don’t have the opportunity to meet sellers

face-to-face, they seek out product reviews and seller ratings to assess

merchant credibility. Buyers rely on social proof and use the experiences

and opinions of others to validate their own purchases.

Buyers, however, won’t be convinced by a single five-star review.

According to MarketingProfs, 67% of customers read at least 6 reviews

before they trust a merchant enough to purchase their product. Sellers

need to present a large amount of positive feedback to earn buyers’ trust

and encourage them to purchase.

To get a high number of positive product reviews and seller ratings,

merchants need to receive a high number of orders. To obtain more

feedback, sellers should assess their number of orders by checking

their unit session percentage (conversion) rate and units ordered

amount. To avoid negative feedback, sellers should frequently check

their seller rating and performance metrics to ensure that they’re

providing excellent customer service.

Tracking Data

and Adhering to

Benchmarks

Tracking data and adhering to benchmarks

Sellers have to know where to find the metrics that impact product ranking,

Buy Box placement, and product reviews in order to improve customer

engagement and acquisition on Amazon.

This data can be found in three types of Amazon reporting:

1. The Business report includes the:

• Unit session percentage rate

• Units ordered amount

• Sessions amount

• Buy Box percentage rate

2. Inventory reporting includes the:

• Stock status of products

3. Seller performance reporting includes the:

• Seller rating

• Performance metrics

- Order defect rate

- Pre-fulfillment cancel rate

- Late shipment rate

We’ll explain where to find these reports and metrics, and identify healthy

benchmarks for this data to help sellers win new customers and keep repeat

buyers loyal.

Tracking Data and Adhering to Benchmarks

www.sellbrite.com

Business report

As mentioned earlier, the Business report is only available to Professional

Amazon sellers, not Individual sellers. Merchants with a professional

account can access their Business Report by logging into Seller Central,

going to the Reports tab at the top, and clicking Business Reports.

[Source]

From Business Reports, sellers can view the growth metrics for each of their

products by clicking on “Sales and traffic by ASIN.”

[Source]

Tracking Data and Adhering to Benchmarks

From this page, sellers can view the metrics discussed earlier: unit session

percentage rates, units ordered, sessions, and Buy Box percentage rates.

[Source]

Healthy benchmarks for sales and traffic are difficult to pinpoint since

they’re pretty relative to the individual seller and their products. For

example, $10,000 in monthly Amazon revenue with 2,000 sessions may

be great for one merchant and disappointing for another. Instead, it makes

sense to start with conversion rate benchmarks and use those reference

points to understand your sales and traffic.

The average unit session percentage (conversion) rate on Amazon is

12.3%.

This rate shouldn’t be viewed as a strict conversion benchmark since it does

vary by category, but it’s a good starting point for assessing your own rate.

If your conversion rate is low, you need to increase your sales, or number of

units ordered.

Tracking Data and Adhering to Benchmarks

www.sellbrite.com

Alternatively, your conversion rate could be low due to low traffic, or a low

sessions metric. With less listing visitors, a seller is less likely to receive

orders. If the order rate drops at a steeper rate than the traffic,

the conversion rate will also decrease

In the example above, notice how the conversion rate decreases when the

number of units ordered decreases by half, and the number of sessions

decreases slightly less by a fifth.

For a Buy Box percentage benchmark, this rate should ideally be as close

to 100% as possible. However, the level of competition in a listing can make

it impossible to get a Buy Box rating this high. If multiple sellers are offering

competitive pricing, they may each only win the Buy Box 15-30% of the

time. Instead of only aiming to reach 100%, sellers should also evaluate

their Buy Box percentage over time to determine average levels for the rate,

whether it’s improving or weakening, and what a healthy benchmark might

be for the specific listing.

Inventory report

Like the Business Report, the Inventory Report is also only available to

Professional Amazon sellers. Merchants with a Professional account can

access their Inventory report by logging into Seller Central, going to the

Inventory tab at the top, and clicking Manage Inventory.

Tracking Data and Adhering to Benchmarks

[Source]

Once you’ve clicked Manage Inventory, you can easily check the stock

status of your products. Check off Active Listings and review the Available

column to make sure all of your current products are stocked.

[Source]

For healthy restocking benchmarks, don’t wait until your inventory drops to

zero to restock your item. Pick a higher number to check for when you re-

view the Available column so that you have time to restock the item.

Tracking Data and Adhering to Benchmarks

www.sellbrite.com

Seller Performance report

Performance metrics and seller ratings are accessible to all Amazon seller

account types. This data can be accessed by logging into Seller Central,

clicking the Performance tab at the top, and clicking Performance Metrics to

view the ODR, late shipment, and pre-fulfillment cancellation rate.

Amazon provides the following benchmarks for their three main performance

metrics:

• Order defect rate <1%

• Pre-fulfillment cancel rate < 2.5%

• Late shipment rate < 4%

Your Seller Rating can also be viewed by clicking the Performance tab and

then clicking Customer Feedback.

The healthy benchmark for seller ratings is 4 stars or above. Ratings that

are lower are considered neutral or poor by Amazon, which can cause you

to become ineligible to win the Buy Box.

What if You’re Not

Meeting These

Benchmarks…

If you’re not meeting the benchmarks for these metrics, there are steps

you can take to improve your stats for greater customer engagement and

acquisition.

Low conversion rate

When your conversion rate is too low, it often means your sales are too low.

Here are a few tips to boost your number of orders:

• Evaluate your pricing. You may need to lower your price in order to win the

Buy Box more and increase your sales. Check your competitors’ rates to see

how your prices compare and whether they need to be decreased.

• Consider offering free shipping. Free shipping not only makes your order

more attractive to buyers, but it also makes you more likely to win the Buy

Box. Amazon considers shipping as a part of the order price, so offering free

shipping will make your price more competitive.

• Improve your Amazon seller reputation. Whether it’s soliciting more product

reviews or making your customer service transparent, boosting your seller

reputation will make buyers more likely to trust you and buy your products.

What if You’re Not Meeting Benchmarks…

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A low conversion rate could also mean your traffic isn’t high enough. The

fewer visitors you have, the more likely your orders will drop. Here are a few

tips to increase your listing traffic:

• Use SEO keywords in your listing. Using terms and phrases that are

frequently searched will drive traffic to your listing.

• Use high-quality, clear images. When buyers are going through search

listings, they’ll be much more likely to buy your product if they see a good-

looking photo.

• Advertise your listing. Consider using Amazon’s advertising solutions to make

it easier for customers to discover your listings and buy your products.

• Whether it’s increasing your orders or increasing your traffic, finding a way

to boost your conversion rate is critical in encouraging more sales from old

and new customers.

Low product availability

If a seller’s active listings are consistently running out of stock, they need to

improve their inventory management plan to ensure that their products are

always available to order and ship.

For all types of Amazon sellers, FBA or not, inventory management is the

merchant’s responsibility. Sellers who don’t feel confident in handling their

own inventory management should consider using a tool like Sellbrite.

What if You’re Not Meeting Benchmarks…

Poor performance metrics

Poor performance metrics can make you ineligible to win the Buy Box and

are also usually paired with negative reviews from customers. To avoid

these damaging effects, here are a few strategies for improving each metric.

Lower a high order defect rate by:

• Providing excellent customer service to avoid receiving negative order

feedback. If you’ve already received negative order feedback, resolve the

customer’s issue and they may potentially remove their feedback.

• Accurately describing your products on your listings. If you deliver a

product that’s not as it was described, a buyer can file an A-to-Z guarantee

claim, causing your ODR to increase.

• Delivering your products on time. Buyers can also file A-to-Z guarantee

claims if their orders aren’t delivered on-time, so avoid increasing your ODR

with late shipments.

Decrease a high pre-fulfillment cancel rate and a high late shipment rate by:

• Making sure your items are in-stock and ready to ship. With this preparation,

sellers can avoid canceling orders prior to ship-confirmation and sending

late shipments. Tools, like Sellbrite, can also assist with inventory

management.

Sellers who use these strategies to keep their performance metrics at

healthy levels will enjoy the benefit of maintaining Buy Box eligibility.

Low seller rating

A low seller rating can hurt your customer engagement and acquisition

efforts by making you ineligible to win the Buy Box. To increase your seller

rating, you need to make sure you’re providing excellent customer service

by:

• Responding to all buyer messages and solving all customer issues as they

arise.

• Having an inventory management plan to ensure product availability and on-

time deliveries.

• Working with buyers to remove negative feedback.

What if You’re Not Meeting Benchmarks…

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Maintaining a high seller rating gives you peace-of-mind in knowing

that you’re keeping customers happy and encouraging them to continue

engaging with your business.

Metrics and

Benchmarks Wrap-up

Can’t remember each metric and benchmark? Here’s a wrap-up to help you

out.

Metric Benchmark Reporting

Units ordered n/a Business

Sessions n/a Business

Unit session percentage Amazon average =12.3% Business

Buy Box percentage

Ideally close to 100% but varies

depending on seller and product

circumstances Business

Stock status

The amount available should always

be greater than zero for active

listings Inventory

Order defect rate <1% Performance

Pre-fulfillment cancel rate <2.5% Performance

Late shipment rate <4% Performance

Seller rating 4 stars or above Performance

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Using Numbers to

Grow Your Amazon

Business

Amazon merchants can’t interact with their customers because they sell

online. Unable to give memorable, in-person customer service, these sellers

have to monitor and improve their engagement and acquisition efforts

with data. By tracking metrics, merchants are able to assess their position

in the Amazon environment and encourage both old and new customers

to continue doing business. With buyer behavior constantly changing

over time, sellers who continuously monitor their data and iterate on their

engagement and acquisition efforts will stay successful on the marketplace.

We hope you enjoyed going through this ebook!

Still have questions? Ask us on Twitter.

Sellbrite is a leading multichannel inventory and order control solution

that helps retailers build, manage and grow their multichannel ecommerce

businesses. The intuitive Sellbrite platform enables retailers to list and

control their inventory on multiple online channels, such as Amazon, eBay,

Etsy, Walmart, Jet, Shopify, BigCommerce and others, all from one simple

interface. In addition, powerful automation and order fulfillment capabilities

free up time and accelerate growth. And, with its wide-reaching data and

reporting features, the platform delivers valuable cross-channel insights to

make smarter decisions.

To start your 14-day free trial of Sellbrite, visit us at sellbrite.com.

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