When comparing the Amazon Buy Box vs the Walmart Buy Box, eCommerce sellers must realize they require very different approaches. Each marketplace uses a unique, proprietary algorithm to choose the respective Buy Box winners of any listing at any given time, and the two algorithms have major differences between them.
Because the Buy Box represents the best digital real estate on both Amazon and Walmart in that it’s the first price option shoppers see, sellers are constantly trying different tactics to win more Buy Boxes. The coveted “Add to Cart” button leads to a vast majority of sales on both major marketplaces, so there’s good reason to make the effort to win the Buy Box as much as you can. But in order to remain profitable, you must first understand whether it’s even possible to win it on each listing landscape you’re a part of.
Since your price is a major factor in determining if you win the Buy Box, there’s always a chance you’ll be unable to offer competitive prices due to your cost structure being too high, at least relative to competing sellers. If you find that to be the case, you may first want to consider implementing new product research methodologies and advanced sourcing strategies to find products you can price more competitively so you can win the Buy Box more often and actually profit.
But if you have your product mix locked down and you’re able to offer competitive prices without drastically sacrificing your profitability, the following information will help you start winning more Buy Boxes across both Amazon and Walmart Marketplace.
Let’s start with the Walmart Buy Box since it’s less complicated.
The Walmart Buy Box is simple: You win it by offering the lowest price (including the cost of shipping) and having products in-stock. This is alluded to in Walmart’s Knowledge Base in its “Understanding the Buy Box” article:
“Making sure your items remain in stock and offering competitive pricing will improve your chances of winning the Buy Box.”
Below is a screenshot of a listing with three competing sellers on Walmart Marketplace. Note the text we’ve added to the image:
If a shopper actually decides to click “Compare all 3 sellers,” here’s what they’ll see on the next page:
The seller at the bottom, Datavision Computer Video, may want to reconsider listing this item at all, since Walmart is a tough competitor to try to underprice, and odds are they won’t be able to generate many sales with the current competition offering lower prices and faster shipping.
If liquidating this product to recoup whatever cash they can get is the route this seller decided was the best course of action, she could use an automated Walmart repricing tool to strategically price below the Buy Box price by a penny (or more aggressively, if they want to drive sales faster) until they completely liquidate this product from their inventory. In doing so, the seller would be able to steal the Buy Box (at least until Walmart or VIPOUTLET underpriced them in response) to help the product sell out faster.
This strategy will cut into their margins in the short-term, but it will generate revenue that could be used to source products with a better chance of winning the Buy Box in the future that could be sold at higher margins.
By researching listings thoroughly, you’ll be able to gauge how good your chances are of winning the Buy Box at a profitable price before committing cash to invest in those products yourself, so you’ll minimize the likelihood of having to employ an aggressive underpricing strategy to liquidate products in the future. You’ll also be able to deduce whether you’ll need to offer free shipping or if you could still win the Walmart Buy Box with additional shipping charges tacked onto the price of your items.
Just remember that when it comes to Walmart Marketplace, it may not make much sense to list products that other sellers can underprice you on, especially Walmart itself, since you’ll only win the Buy Box as the lowest-priced seller, and it never pays to win the Buy Box unless you can earn a profit at that low price (unless you’re looking to liquidate product and your goal is not to generate profits).
One more important note is that Informed has a feature that will automatically raise your price when you’re in the Walmart Buy Box to be a penny below the next-lowest-priced seller on the listing.
So, let’s say you win the Walmart Buy Box by pricing at $10.99 when your next-lowest competitor is at $11.00, and then that competitor sells out or leaves the listing. Instead of keeping your price at $10.99, Informed will survey the listing landscape to find the next-lowest-priced seller and then raise your price to be a penny below her. So, if the next-lowest-priced seller was at $13 after the seller pricing at $11 disappeared from the listing, your price would raise to $12.99 and you’d remain in the Walmart Buy Box.
That means you’ll always be at the highest possible price when you’re in the Walmart Buy Box, but only when you power your price changes with Informed.
As opposed to the simplicity of Walmart’s Buy Box, winning the Amazon Buy Box is a vastly more complicated endeavor by comparison. That’s because Amazon’s Buy Box algorithm takes more than a dozen seller metrics into account when determining the Buy Box winner of a listing at any given time.
And that’s only if you’re eligible to win the Buy Box.
The four most critical metrics for any Amazon seller to be thinking about if they want to win the Buy Box more frequently are:
Additionally, the following seven Amazon seller metrics should be considered important, although less so than the above four:
If two sellers are perceived as equally competitive based on the top four metrics, Amazon’s algorithm will move to the second set of metrics to deduce who to award Buy Box placement to, at least for the moment.
That’s because Amazon rotates Buy Box ownership between multiple sellers each day, so one seller cannot ever claim to own the Buy Box 100% of the time for any listing (except in rare circumstances, such as when sellers list unique product bundles).
The reason Amazon rotates the Buy Box has more to do with the behavior of sellers than Amazon itself, with the use of automated repricing tools going mainstream and sellers constantly changing their prices in relation to their competitors as a result. This makes nearly every Amazon listing a dynamic landscape, with the perceived “best offer” continually changing as sellers adjust their prices and have their other metrics change for better or worse with each sale made.
Beyond the metrics already mentioned, Amazon also considers the following three metrics to determine who wins the Buy Box, but these are given the least amount of weight by the algorithm:
This may seem like a lot to think about, but as long as you fulfill orders on-time without defects, you’ll likely be able to boost your standing among most, if not all, of these metrics, as you continue to build your business.
And if you’re looking for an advantage when it comes to winning the Amazon Buy Box, consider using FBA over MFN to instantly qualify for Prime 2-Day Shipping, which Amazon’s algorithm considers highly favorable when awarding the Buy Box.
Otherwise, if you have your own warehouse and plan on fulfilling orders yourself, try qualifying for Seller Fulfilled Prime so you can offer Prime 2-Day Shipping while fulfilling your own orders, helping to boost your Buy Box preference while helping you avoid profit-punishing FBA fees.
Because Amazon’s Buy Box algorithm is so complex, it helps to use an example. So, let’s do it! For the sake of simplicity, we’re only focusing on the top four Amazon seller metrics in this example.
Imagine you’re Seller #1 in the follow scenario where 5 sellers are listing the same product:
So, who do you think will win the Buy Box on this listing? The answer is that it’s actually unclear, since some sellers do better than others on different metrics.
In this scenario, Amazon would likely rotate the Buy Box between at least a few of these sellers, if not all of them, depending on their other seller metrics. While some may hold the Buy Box for more time than others, there’s a case to be made for all five of these sellers to win the Buy Box and hold it for at least for a short time, at least when comparing them based on the four most important metrics. And if these sellers are using strategic repricing tools like many others out there, it will drive Amazon to rotate the Buy Box even more.
Also noteworthy is that there’s speculation that different metrics have different weights in the Buy Box algorithm depending on the category, based on what Amazon thinks shoppers care about more within each category. For example, if the category has products that shoppers are more time-sensitive for, such as holiday cards, at least in the eyes of Amazon’s algorithm, it may award the Buy Box to sellers with faster shipping times over sellers with higher Seller Ratings.
On the other hand, if the category features high-ticket items that shoppers are perceived to want to buy from a more trustworthy seller, Amazon may award the Buy Box to sellers with higher Seller Ratings over sellers with faster Shipping Times.
Always do your best to understand what customers want most when choosing which categories to list products in on Amazon, as well as how your current seller metrics play into those customer demands. If certain products seem to require faster shipping to drive sales, yet you know you can’t offer anything faster than 7-day shipping, you may want to shift your focus to products that won’t have sales affected as much by your slower shipping time.
Sometimes it will be easier to tell which seller provides the most competitive offer, such as in the example below:
While the metrics between these 5 sellers are close to each other, it’s clear that Seller #1 provides the best overall deal, despite being priced a penny higher than Seller #3.
That’s because the guarantee of Prime 2-Day Shipping from FBA is worth much more than the 1-cent extra a shopper would have to pay to Seller #1 for the product in question, versus paying Seller #3 to get you the product 2 days later than Seller #1 at the earliest.
There’s also a decent chance that you won’t get the product from Seller #3 in just 4 days, since there’s a 10-day shipping window of 4 to 14 days.
The main takeaway here is this:
You don’t have to offer the lowest price on a listing to win the Buy Box on Amazon, whereas you do have to offer the lowest price to win the Buy Box on Walmart Marketplace.
While price is certainly weighted heavily by Amazon’s Buy Box algorithm, other metrics also play a major part is determining who wins the Buy Box, and the listing category may also affect which metrics are considered more important by the algorithm on a listing by listing basis.
This Amazon Buy Box example shows the Buy Box winner is not offering the lowest price on the listing.
This is the page you get to if you click where it says “New (13) from $14.69” in the first image. Note again that the Buy Box winner is not the lowest-priced seller on the listing.
Knowing the differences between the Walmart Buy Box and Amazon Buy Box will help you price accordingly on each marketplace and list the best products for your overall profitability on each respective platform.
Because Walmart requires you to list at the lowest price on any listing if you want to win the Buy Box, you may not be able to sell some items as successfully on Walmart as you would on Amazon and vice-versa.
If you have superior seller metrics to your competitors on Amazon, you may be able to win the Amazon Buy Box frequently without offering even close to the lowest price on a listing. Research suggests that sellers with exceedingly high Amazon metrics can price over 30% higher than the lowest-priced seller on a listing and still win a share of the Buy Box.
We recommend having a deep understanding of your costs and each marketplace before deciding to scale to other marketplaces besides Amazon and sell on Walmart Marketplace.
And, if you decide to branch out and become a multichannel seller, it’s vital to equip yourself with the best tools for driving profitable sales and staying ahead of the competition. That’s why we recommend testing out an automated repricing tool for free, like the one we built at Informed.co, to see how much more effectively you could run your business with the help of smart pricing algorithms and custom repricing strategies.
A strategic repricer like Informed.co can help you narrow down who you compete against on price based on Seller Rating, Fulfillment Method, Featured Seller status, and Handling Days, so you can home in the most relevant competition standing in the way of your sales.
If you’re curious to experience the power of our automated repricing platform, sign up for a free 14-day trial and all the help you’ll need to become a repricing superstar on Amazon, Walmart Marketplace, and beyond.