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September 09, 2023
As an Amazon seller, tracking a variety of metrics is vital to assess your business's performance and make important improvements. Relying solely on assumptions or optimism won't cut it when it comes to ensuring your business's success!
Monitoring Amazon seller metrics offers valuable insights into individual product performance, overall business success, and the health of your Amazon account.
This article explores the most critical Amazon seller performance metrics that guaranteeing top-notch performance for your business.
The conversion rate is important for Amazon sellers. It shows how well your products are selling. This rate represents the percentage of visitors who actually make a purchase after viewing your product listing.
A low conversion rate indicates issues that discourage potential customers from completing a purchase. These issues may include high pricing, subpar product images, incomplete listing information, negative reviews, and more.
Merchants can verify their Amazon conversion rate per product via their Seller Central.
Step 1. Navigate to Reports > Business Reports in your Seller Central.
Step 2. Review the sales and traffic data.
Step 3. Locate the row labeled “Order Item Session Percentage” which indicates your conversion rate. This feature presents all the items collectively.
Step 4: Search for "by ASIN" reports to identify the Conversion Rate (CVR) for particular items.
As an Amazon seller, closely monitoring your unit session percentage is vital to assess the performance of each product.
Naturally, you might wonder what qualifies as a "good" conversion rate or what you should aim for with your products.The ideal conversion rate is subjective and depends on your business objectives, but there are certain averages that provide useful guidance.
A good conversion rate on Amazon is typically 10%. However, for a Shopify store or similar e-commerce website, it is usually around 1-3%.
Should your products dip under the 10% threshold, there exists potential for enhancement. Conversely, surpassing that threshold generally indicates that your products are performing well.
Related: What Is the Amazon Conversion Rate?
The IPI is an Amazon metric that measures how well FBA sellers handle their inventory. A high IPI score means good and fast sales, while a low score means too much stock or slow product movement.
Related: Amazon Inventory Management
ACoS is a metric for Amazon sellers to measure ad campaign effectiveness. It assesses the profitability of advertising campaigns exclusively.
A lower ACoS is good because it means you spend less on ads but still make the same amount of sales.
However, determining your ideal ACoS hinges on factors like product costs, advertising objectives, and budget constraints.
ACOS is the proportion of advertising expenditure to advertising revenue, represented as a percentage.
In simple terms, ACOS shows how much an Amazon seller invests in advertising to make one unit of product sales revenue. When the ACOS is 20%, it means the seller makes $5 in sales for every $1 spent on advertising.
Related: Amazon ACoS - All You Need To Know
As an Amazon FBA seller, understanding Return on Investment (ROI) is crucial. Amazon product ROI is the percentage of profit you make from selling a product on Amazon compared to the cost of purchasing and selling it. It is an important metric for sellers to track because it can help them determine which products are most profitable and where to allocate their marketing budget.
To calculate Amazon product ROI, you can use the following formula:
ROI = (Net profit / Cost of goods sold) * 100
In this formula:
A good Amazon product ROI is typically considered to be 50% or higher. However, the specific ROI that is considered good will vary depending on the product category and the competition.
To ensure precise calculations, Amazon sellers rely on a range of Amazon fee calculators. Among them, Seller Assistant App's FBM&FBA calculator stands out as one of the best. It provides a convenient way to swiftly calculate all FBA fees and expenses directly on the Amazon product page.
The Seller Assistant App's FBM&FBA calculator is a tool that helps Amazon sellers calculate the ROI and profit margin of their products. The calculator takes into account FBA or FBM costs, the Сost of Goods, Amazon referral fees, FBA fees, monthly storage costs, and third-party logistics costs. The FBA & FBM calculator is a helpful tool for Amazon sellers to use to track their profitability and make informed decisions about their pricing strategies. Additionally, you have the convenience of saving your Amazon product analysis results to Google Sheets with just one click.
Related: Amazon FBA Fees 2023
Related: How Does Amazon FBA Work. Is Amazon FBA worth it in 2023?
Amazon Account Health Rating (AHR) is a metric used by Amazon to assess the overall health of a seller's account. It is calculated based on a variety of factors, including order defect rate, on-time delivery rate, customer service responsiveness, and seller feedback.
AHR is scored on a scale of 1 to 1000, with 1000 being the best score. A seller's AHR can impact their ability to sell on Amazon, as sellers with low AHRs may be subject to restrictions or even suspension.
Eligible sellers who want to protect their Amazon accounts enroll in the Account Health Assurance program. With it, sellers get help to improve their account health and avoid deactivation with personalized guidance and access to Account Health Specialists. Maintaining a robust Amazon seller account health is a prerequisite for enrollment in the Account Health Assurance program. Breaking Amazon's account health rules can cause issues for sellers, even if they're in the Account Health Assurance program.
Therefore, it is prudent to proactively steer clear of Amazon policy violations that may impact your AHR. Utilizing Amazon seller tools can be a proactive solution to maintain a healthy account status.
Seller Assistant App's IP Alert helps avoid products that may cause account health problems and IP claims. Using Amazon's seller database, Seller Assistant App finds IP claims for specific ASINs on Amazon, keeping sellers updated. The feature automatically collects and anonymizes account health issue data on a daily basis. If any products are problematic, the IP Alert feature will display a Red Triangle icon along with relevant case details.
Seller Assistant App is a browser extension for Amazon Sellers that combines FBA Calculator, IP Alerts, Stock Checker, Quick View in one tool. Get this here.
In conclusion, consistently monitoring and optimizing these metrics will position Amazon sellers for success. Understanding conversion rates, managing inventory efficiently, optimizing advertising, and accounting for fees are fundamental for profitable business operations. Additionally, participating in Account Health Assurance and utilizing seller tools contribute to a thriving Amazon business.
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