Selling on the Amazon marketplace is an excellent opportunity that offers customer reach that no other platform can match. With more than 50% market share of eCommerce, it’s evident that shoppers are buying from Amazon, and you need to be there.
Many businesses have done quite well selling on this platform, but behind every success story, there is a seller who is left very frustrated.
The FIRST thing that any brand getting into this marketplace needs is an understanding of how Amazon works. Understanding how the A9 algorithm works and the AI powering it is key to your success.
In this episode, I am joined by Shannon Roddy, Amazon strategist, educator, and business development lead for Avenue7Media, and we’re going to take a deep dive into how Amazon really works.
You Have to Make the Algorithm Happy
The primary algorithm that powers search rank in Amazon is known as the A9 algorithm. There are many other algorithms, but this is the most important one since it determines where your listing ranks.
Just like Google’s algorithm encourages search and Facebook’s encourages you to spend more time on their platform so that they can serve you more ads, the A9 algorithm is designed to encourage customers to make a purchase.
“A9 algorithm will make or break you; you’ve got to make it happy!” Jason Boyce
The mistake we see many new brands making is coming to Amazon with the retail mindset. Forget about all that and start studying what triggers the algorithm positively and negatively.
You can be the only seller of your product, yet you are not winning the buy box. This is because the algorithm is looking at many other things.
So, how does it work?
Amazon does not disclose what ranking factors they take into consideration and the weight they attach to each of them, but from our experience, these are some of the most important factors we believe will impact your listing.
✅ Keyword Relevancy
✅ Performance Metrics
✅ Return Rates
✅ Images
✅ Click-Through Rate (CTR)
✅ Conversion Rate
✅ Reviews
✅ Seller Authority
✅ Sales History
To make sales on Amazon, you should strive to be on page one for your keywords. Why? Because 70% of buyers don’t go to page 2 in search results. Working on these factors will push your listing further up the rankings.
Amazon AI Replaces People and Repetitive Processes
Part of the reason why Amazon has grown massively is its Artificial Intelligence. The entire platform is machine learning-oriented.
The AI replaces people and repetitive processes to allow for massive and fast scaling.
“Amazon has won eCommerce by being different and being AI machine learning-oriented. Human interaction is not a value to them.” Jason Boyce
If there is a technology that can help improve their processes, Amazon doesn’t hesitate to deploy it, no matter how many people it replaces.
As an example, their warehouses and fulfillment are incredibly AI and robotics-based, which allows them to process transactions on a scale no other eCommerce platform can.
How does this impact you as a seller?
AI is like a 6-year-old. There are some things that it simply doesn’t ‘get’ despite its best intention.
A small percentage of sellers will be impacted by the AI not being perfect. These are the horror stories we hear from some Amazon sellers who did everything right, but somehow the AI screwed them.
The KEY here is to have quality people on your team who know how to deal with the systems, the people, and the technology at Amazon. If there is a problem, they can help you quickly figure it out.
Don’t Try to ‘Hack’ Amazon
How often have you heard someone promising a “hack” or a ‘loophole’ that will make you sell more on Amazon?
The funny thing is that some of these hacks actually work in the short term. But always remember you are not smarter than Amazon.
“Amazon hacks are short-term solutions that cause you long-term pain.” Jason Boyce
As soon as Amazon gets wind of that hack, they bring in a new policy update or/and an algorithm update covering the loophole that some sellers might have exploited.
But them being Amazon, they don’t stop there! They have been known to go back and retroactively suspend or suppress any seller accounts that exploited the loophole. Amazon can do this because most of these hacks violate their TOS.
We strongly encourage all sellers to follow the rules. Legitimacy for longevity is how Shannon poetically puts it.
Federal Agencies Are Driving Some of the Changes
Federal agencies such as the FDA, FTC, and FCC are actively engaged in driving some of the changes that sellers blame on Amazon.
They are looking at listings for any claims that they think sellers shouldn’t be making and those kinds of things.
Amazon Doesn’t Care About Your Feelings, Only Those of Their Customers
As a seller, the sooner you realize that Amazon doesn’t care about your feelings, hard work, capital, risks, etc., the happier you will be.
Amazon is mainly run by algorithms, AI, and bots. These things are incapable of feelings. Once you understand this, you can start figuring out how they work and what you should be doing to make them happy.
Tune in to this episode as Shannon and I give you a full analysis of how Amazon works. We hope you’ll find this information helpful!
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