Amazon Feedback Impacts Your Bottom Line

It’s easy to get your feelings hurt when a buyer leaves nasty feedback on the Amazon marketplace.

Sure, you’re thick-skinned. You know how to handle even the most irate customers. But, there’s just something especially hurtful when the situation results in a negative online rating.

Looking past the sour grapes, there are also financial repercussions with each new feedback you receive. In this post, we’ll take a closer look at why Amazon feedback can make (or break) the success of your online store.

 

Feedback Influences the Buy Box

Did you know that your feedback score influences your likelihood of winning the Buy Box? That’s right. As Amazon points out here, sellers must meet minimum performance-based criteria if they wish to be Buy Box-eligible.

Amazon considers the following when awarding the Buy Box:

  • Order defect rate (“ODR”) maintained by the seller
  • Level of “customer shopping experience” typically offered by the merchant
  • The seller’s experience level (time is likely a factor here)
  • Other seller performance metrics (known only to Amazon)

Though these may not necessarily be mandatory, Amazon also gives preference to sellers who:

  • Participate in the FBA program
  • Are Professional-level sellers

Looking at the above criteria, you can see that feedback (whether positive or negative) plays an important role in winning the Buy Box. For example, ODR is based heavily on negative customer feedback. Likewise, “customer shopping experience” is probably Amazon-speak for “feedback rating.” Although we don’t know what “other seller performance metrics” really means, it’s a safe bet that lifetime feedback score is somehow factored into the Buy Box equation.

 

Feedback Also Affects Your Good Standing with Amazon

Winning highly profitable Amazon orders is the name of the game. But, this is obviously impossible when your account gets suspended by Amazon.

To help you avoid suspension, Amazon exposes countless seller ratings that measure everything from return dissatisfaction to late responses. Granted, not every metric is as impactful as A-to-z claims (regarding Amazon’s guarantee of an item’s condition, timely delivery and eligibility for refund). But some, such as negative feedback, can certainly damage your relationship with Amazon. In fact, Amazon gets pretty specific and warns sellers that “the number of negative feedback entries should be less than 5% of the total feedback entries received.” Approaching the 5% negative feedback rate puts your account health at risk.

How can you keep negative feedback to a minimum (thereby reducing your chance of suspension)? For starters, it’s important to examine the root cause of negative feedback. Naturally, even the best sellers occasionally receive poor ratings. However, a pattern of dissatisfied customers may indicate a serious problem with business processes. Are you understaffed for your current level of demand? Should you consider fulfilling more orders via the FBA service?

Once you’ve remedied any workflow issues, you might also consider developing a strategy for removing negative feedback. Dealing with a bad rating can be extremely disruptive, especially when you’re unprepared. Be ready to deal with negative feedback before it occurs – then, hope you’ll rarely have to use your plan of action.

 

Feedback is an Income-Producing Asset

In today’s digital world of commerce, merchants tend to have few tangible assets (other than inventory). With Amazon providing most of the supply chain infrastructure, a typical seller has less need for capital equipment than in decades past. This is great news for those wishing to start or grow an eCommerce brand, as fewer barriers exist than ever before.

On the other hand, fewer barriers allow for increased competition. Competition, although good for consumers, isn’t usually great news for merchants.

For these reasons, a prudent Amazon merchant views his feedback score as an income-producing asset. As a seller grows his feedback history into the hundreds or thousands of ratings, he differentiates himself from the fly-by-night sellers that seem to come and go. All things being equal, the seller with the best feedback history stands ready to capture a sizable piece of an item’s Buy Box pie.

 

Protect Your Bottom Line with Better Feedback

On its own, a single feedback rating serves as an important channel of communication between the buyer and seller. When aggregated, a merchant’s entire feedback history is an influential metric that impacts sales revenue and overall profitability. Take the necessary steps to protect your seller reputation – and, most importantly, your bottom line.

By Liz Fickenscher, eComEngine

Liz Fickenscher is a principal of eComEngine.com

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Phone: 1-877-9-Seller