Buy Box Ownership Varies By Location- A New Piece of Amazon's Algorithm
In Amazon's ever-evolving algorithm's to provide the customer with the best price, shipping speed and quality, all while making a profit for themselves, it appears they are adding a new piece of the equation to their algorithm for Buy Box ownership — location. Amazon has developed and are currently testing a regional Buy Box feature that is dependent on a customer's location and a brand's inventory in an Amazon Fulfillment Center. While there’s no sure-fire formula winning the Buy Box rotation, there are minimum criteria you must meet if you want to be in the running. Historically, the factors of the Buy Box equation have been: ASIN sales, customer feedback on orders, and product reviews on the detail page.
Adding location into the equation of winning the Buy Box could mean another opportunity for Amazon Vendor's to consistently win (read more about this week's One Vendor speculation), as their inventory is much more widespread compared to Seller accounts participating in FBA (Fulfilled by Amazon). Not all fulfillment centers have every product in stock, so in order to provide the best experience and easiest route for Amazon Prime 2-day shipping, they are varying the Buy Box owner based on the consumer's proximity to the warehouses that have the product in stock.
Even if the Seller is meeting all other criteria required to win the Buy Box, because a product might have inconsistent sales across the country that can now impact their rotational Buy Box eligibility. In a state where your product may have lower sales, another seller with a greater sales volume in that particular state would be winning the Buy Box. Amazon shared that they currently do not have the ability to provide to brands which particular regions are or are not winning the Buy Box per product, but that is something they are developing, stating, "Our team is working this and trying to introduce a feature where we will be able to tell for which particular region sellers are not winning the Buy Box," a representative stated through a Seller Support case.
The most shocking and, perhaps, detrimental part of this update? Brands need to win the Buy Box in every region in order for their ads to deliver. Amazon Seller Support stated, "for Sponsored Product [ads] to be active, your product must win the Buy Box for all regions across the US." Which is a rather strict qualifier for brand's ads to be displayed.
How can brands selling FBA ensure they are winning the Buy Box?
Simply put, send enough inventory across the board to have sufficient inventory levels across every region. Marketplace Strategy's Lead Client Strategist, and Co-Founder, Curtis Rummel, suggests for brands to send inventory to all of their recommended fulfillment centers instead of sending inventory into one, consolidated fulfillment center, which many times seems like the easier route to take.
Curtis recommends, "it’s better to select the “Distributed Inventory Placement” for your FBA shipments instead of the “Inventory Placement Service” because Amazon does a better/immediate job of sending inventory all over the USA, therefore allowing you a better chance of winning the Buy Box," and his overall solution for brands is to keep a very healthy inventory level and ensure shipment of inventory to all fulfillment centers.
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