I'm a former Amazon marketplace leader and current 8-figure seller. I write about advanced strategies and tactics for Amazon brands, that you won't read about anywhere else. Not for beginners.
βΌοΈ A Super Secret Way to Cut Your Return Rate in Half
This Issue's TLDR...
β π Did someone forward you this newsletter? First of all, give them a crisp high five when you see them. Second, head over here to subscribe and read past issues. β BEST from MeMy main man Mike Patron is fired up. Again. This time, it's about the upcoming Returns Processing Fee that goes into effect on June 1.
Like the other newly introduced fees, the Returns Processing Fee is...half baked. The biggest issue with the fee is that it is calculated by reference to a "return rate threshold" for each category (which is maybe static, or maybe dynamic?). No one knows what those thresholds are though, because Amazon isn't publishing them until May 1. Which doesn't give a seller any time to take action on ASINs that might be at risk of incurring the fee. Another relevant detail...Amazon isn't disclosing how it is calculating the return rate threshold. This is important because returns have reason codes assigned to them. And, I can tell you that a significant portion of every seller's returns are due to "Unwanted item" (for all of my brands, this reason code accounted for 25%-38% of my return). In the FBA Returns dashboard, Amazon includes "Unwanted item" in the product return rate calculations. But will it do the same with the category return rate threshold? We don't know. Which is frustrating and potentially costly. That's enough kvetching though. Let's be solutions oriented here. If, in 2-3 months, you realize that you need to drastically reduce your return rate, here's what I'd recommend... Hello, Product Lifecycle SupportIf you're unfamiliar with Product Lifecycle Support, it's a secret-ish Amazon program with the following mission: The mission of Product Lifecycle Support (PLS) is to offer relevant post-purchase product support to customers and empower them to make the most of the products purchased on Amazon. By solving post-purchase product issues, we prevent avoidable returns which helps the planet by extending products life and helps brands reduce the financial and environmental impact of returns. Most people don't know, but PLS has been around for years...on the 1P Vendor side. It wasn't until ~4 years ago that it was quietly opened up to 3P Sellers...in beta...in only a few categories. There are different PLS sub-programs, but each offer brands a way to engage with customers...precisely when customers need support, and outside of buyer-seller messaging. Speaking from experience helping brands get enrolled, I've seen PLS reduce return rates by ~30%. Curious what the PLS experience looks like for customers? Here's a video from my friends at Onsite Support who, by the way, can get you enrolled and set-up with PLS quite quickly. β If you're interested in the fast lane to PLS enrollment, email my buddy Issac at isaac@onsitesupport.io and let him know that Jon from Best@Amazon sent you. He'll hook you up. BEST from Everyone ElseBest from the B@A CommunityI had the following question come in from a B@A reader a few weeks back and, since this issue is mostly about customer returns, it felt appropriate to dust off my answer and share. Hey Jon, do you know if there is a connection between returns and rankings? I.e., if an ASIN has an increasingly high return rate, will that hurt its ranking? Short answer: No one knows, definitively. Longer answer: The A9 algorithm is designed to optimize for customer satisfaction. It does this by putting considerable weight on product relevance and product performance signals that happen before a customer purchase. But customer satisfaction isn't just measured before the purchase. It's measured after, through product reviews/ratings, order cancellations, and refunds/returns. Given that A9 optimizes for customer satisfaction, it stands to reason that return rate would be a factor in ranking. But, don't take my word for it. In an Amazon Science paper (not related to A9), there's a statement that "Amazon uses signals such as ratings, return rates, and safety rate to identify low regret products." So...I'd say that returns do impact rankings to an extent. Best from my (WhatsApp) InboxIn one of the (many) Amazon-related WhatsApp groups that I'm in, a group member recently asked this question: Alright Amazon peeps, what do you guys believe to be an average range for refund rates on Amazon?
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I'm not talking about the NCX Return Rate (that only takes into account returns. The customer said there was a product or listing related issue), but instead simply the number of refunds or returns divided by sales.?
Short answer: You don't have to poll people to get an answer to this question. Amazon shares this data at the ITK level. Go to Growth > Marketplace Product Guidance > Category Insights. Once there, and after you've selected your Product Type or ITK, you'll find Return Rate below the fold. β NOTE: I'm on the record somewhere on the internet that these return rates will be the reference rates that determine whether ASINs are subject to Returns Processing Fees. Best from XI was having a little fun with AI and memes over the weekend, while also dwelling on the tone-deafness of Andy Jassy's statement that Amazon has a "great relationship with sellers." This was the result:
Best from LinkedInThe Momentum Commerce Data Science team is the best in the game. They continue to investigate and put out research reports that provide answers to questions that are actually relevant to sellers. (Contrast this with a lot of the "research reports" that software and/or service providers put out that is some mix of content marketing and macro findings that are interesting, but not useful) The latest from Momentum Commerce? A deep dive into coupon redemption rates by discount percentages. Here's one way that you can use this data: π I've talked before about the List Price strike-through hack (see video). One thing I'm noticing though, with this hack, is that it's getting harder to get Amazon to "validate" your List Price (so that you can get it struck-through). It used to be the case that you could enter a List Price, apply a coupon for 24-48 hours, book a handful of full List Price sales (because not all customers redeem coupons), and then you'd have a validated List Price. Today, what I'm seeing it that it takes A LOT more sales at your List Price to get it validated. How can you get "A LOT" more sales at your List Price in a shorter period of time? Well, this data provides a clue. In the chart above, you can see that discount percentages less than 20% have redemption rates less than 50%. Put differently, for these lower discounts, a majority of your customers will actually buy at your List Price. Which is a powerful signal to Amazon that the List Price is valid. Of course, there's a negative ranking impact from having a high List Price = Standard Price for too long. But, that's mainly related to the lower CVR. But, that's where the coupon comes in. It keeps CTR high, and CVR high enough to avoid significant harm. β Updates to the Amazon Private Label PathwayNo updates this week. * Back Story on the Amazon Private Label Pathway, ICYMI... A few months back, I had a small group of coaching clients that were at the same point in their Amazon seller journeys. I found myself answering the same questions, and pointing them to the same resources, so, in true Amazon fashion, I asked myself "What's the 1-to-Many solution here?" and built a Notion page of helpful resources, which I've called "Amazon Private Label Pathway." You can get access to it here: https://auxo.gumroad.com/l/amazonpathway (it's free; but if you want to buy me a beer, I won't object)β β |
Best @ Amazon
The Newsletter for the Top 1% of Amazon Sellers
I'm a former Amazon marketplace leader and current 8-figure seller. I write about advanced strategies and tactics for Amazon brands, that you won't read about anywhere else. Not for beginners.
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