Amazon customer metrics show you how well you are performing as a seller. The metrics have been put in place by Amazon to ensure that sellers meet the high expectations they demand for their customers. In short the metrics are used as a quality control for sellers.
Amazon’s customer metrics contribute to your overall seller rating. The seller rating is decided by Amazon’s measuring of your customer metrics along with seller feedback, and is scored out of 100. You can see your seller rating on the homepage of seller central (along with a general account health overview).
If you want to increase your chances of winning the Buy Box it’s crucial that you have a good seller rating (above 90). If you have a bad seller rating Amazon can suspend or even terminate your seller account, so you need to act immediately if your seller rating is poor!
Amazon quite simply doesn’t tolerate bad sellers, and why should they? With bad sellers come unhappy customers and that’s not what Amazon wants. There are five key customer metrics Amazon use to help calculate your seller rating:
- Order Defect Rate (ODR)
- Cancellation Rate
- Late Dispatch Rate
- Policy Violations
- Contact Response Time
To find an overview of your Amazon customer metrics click the “Performance” tab on Seller Central, then click the “Account Health” tab. This gives you a detailed breakdown of your Amazon seller performance.
(On the performance page you can also see your ‘Perfect Performance’ percentage which tells you the number of your sales which have accepted, processed and fulfilled perfectly on time with no customer complaints in the last 90 days. Amazon state that this percentage should be 95% or higher.)
For more information on improving your customer metrics, see here.
Each of the Customer Metrics Explained
Order Defect Rate (ODR)
In short, any order that has negative seller feedback, an A-to-Z claim, or a credit card chargeback is considered as having a ‘defect’ by Amazon. The ODR is calculated by dividing the number of ‘defect’ orders by the total number of orders over a certain time period.
Amazon have set a target of <1% failure for the ODR metric.
When a customer buys any product on Amazon they are invited to leave feedback related to the seller. If a customer leaves negative seller feedback, this will affect your ODR metric score. This makes it important to keep your customer’s happy by offering excellent customer service and resolving any customer issues as quickly as possible.
The A-to-Z guarantee is Amazon’s promise to customers that all products purchased from Amazon or any third party seller will arrive in the condition they were described as being in and delivered in the time frame the seller has set. If you are unable to deliver a product on time or the product arrives in an unsatisfactory condition the customer can file a guarantee claim against you.
A service credit card chargeback occurs when a buyer disputes a charge with their bank, if an item is faulty or damaged, customers can ask their bank to reverse the charges on their card.
In summary the ODR metric measures whether you are advertising the condition of your stock accurately and whether you are able to handle customer complaints before they escalate to more serious issues. A target of less than 1% seems harsh and perhaps a little daunting, however, if the product you sell is accurately described, well packaged and you always respond to customers quickly you shouldn’t have any difficulty meeting this target.
Pre-Fulfilment Cancellation Rate (PFCR)
The PFCR refers to the percentage of orders which are cancelled by the seller before shipment. The most common reason for this happening is bad stock management. Quite simply the seller can’t provide the product they’ve listed to the customer who’s tried to buy it.
Managing stock is an essential responsibility for every seller. Sellers need to know how many units of each product they have and then they need to check how many units they’ve listed on Amazon. Amazon automatically update your stock levels when a customer makes a purchase so you need to check your inventory list regularly.
Your cancellation rate needs to be less than 2.5% to meet Amazon’s PFCR target.
Late Dispatch Rate (LDR)
The LDR metric is the percentage of your orders that have been dispatched late. Amazon state that “A late order is one whose shipment confirmation is overdue by 3 or more days.”
You can ship a product to a customer the second an order is placed but if you fail to update this information on your seller account and notify Amazon (and therefore the customer) then your LDR will increase. So remember to tell Amazon every time you ship out an order!
The LDR should be less than 4% to meet Amazon’s target.
If you list a product on Amazon which violates one of their policies, either due to the nature of the item itself or due to the way the item is listed you will receive a notification. Be sure to regularly check your “Performance Notifications” – which you can find in the performance section of Seller Central.
If you have unread notifications your policy violations metric will indicate this. A green tick means you have no unread notifications or performance notices. A yellow exclamation mark means you have notifications or performance notices to read. If you see a big red cross, you need to read any notification or performance notices because your seller account is under Amazon’s scrutiny!
Buyer-Seller Contact Response Time (CRT)
The CRT metric measures the number of customer messages you have responded to within the 24 hour time frame recommended by Amazon. It’s important that you check your Amazon messages regularly. It also doesn’t matter what day of the week a customer contacts you, even on weekends you have to reply to customers.
A good seller should take far less than 24 hours to respond to a customer enquiry so it’s important to create a schedule that allows you to check your Seller Central account multiple times throughout the day. Amazon also notify you of any customer messages with an email so there should be no excuse for being unresponsive.
Amazon demand that every seller replies to a customer within a 24hr period, failure to do so will negatively affect the CRT metric.
If you want to reduce the time it takes to source profitable products for Amazon resale – get started today with a 7 day free trial and find out how SourceMogul can help you to grow a protibale business!
6 steps to becoming an Amazon seller. No experience needed.
Becoming a successful Amazon seller is easy - the Amazon brand and logo represents…
Top tips for success from a new Amazon seller
We've compiled a list of the top tips for new sellers, gathered from a…
How to get ungated on Amazon – your guide to Amazon restricted categories
If you’re looking to expand your online arbitrage business, you might find yourself tempted…
How to prepare for Amazon Q4 trading
Every year the holiday season seems to come around a little earlier. As an…