As an Amazon Seller, you put a lot of time and energy into ensuring that your products are of the highest quality. You’ve worked to make your storefront look as appealing as possible while providing all the required information about the things you sell. You’ve obsessed over all of the details of fulfillment and delivery.
Despite your carefully laid plans, you notice an uptick in the number of returns and complaints about your products. All these contribute to your Order Defect Rate (ODR), a statistic that Amazon pays special attention to when deciding who can keep their coveted “Buy Box.”
Today, we break down what an ODR is and how to improve yours so that you can continue to drive your business forward.
Defining ODR
Your Order Defect Rate, represented as a percentage, is the ratio of orders returned or reviewed as defective to your total number of orders. Defects can be reported as a result of damaged or poor quality products or subpar customer service. Amazon requires an ODR under 1% in 60 days. Therefore, for every 100 orders you send out, only one may be reported as defective.
Check out your Amazon Seller Central page to view your ODR as it stands right now. Navigate to “Account Health” (under the Performance tab) and click on “Customer Service Performance.” Selecting the option to “View Details” will allow you to view and download containing your ODR, among other metrics.
Three main factors contribute to an Amazon Seller’s ODR: chargebacks on credit card purchases, A-to-Z Guarantee claims, and negative reviews.
Credit Card Chargebacks
These chargebacks occur when customers dispute a charge on their card, and the credit card issuer subsequently processes a refund. These chargebacks are broken down further into two categories:
- Fraud chargebacks: In these cases, the customer claims never to have approved the transaction that resulted in a purchase from your store in the first place. Amazon does not put you at fault for these; thus, do not consider these part of your ODR.
- Service chargebacks: Here, the customer requests a refund based on problems with your product rather than a fraudulent transaction. If the credit card company rules their favor, your ODR takes a hit.
A-to-Z Guarantee Claims
Amazon offers products via a high number of third-party sellers, in addition to their brands. To ensure that these third parties hold up their end of the bargain, Amazon offers customers the ability to file A-to-Z claims if something goes wrong, including the time it took for the product to arrive and in what condition the product came.
Most A-to-Z claims will negatively impact your ODR, and Amazon will even count pending allegations against you. However, not all claims will land on you in the end. Claims that will not affect you include:
- Denied or withdrawn claims
- Claims that Amazon deems were not your fault
- Claims that fall under the Process for Property Damage and Personal Injury
Negative Feedback
Amazon considers it a negative review when the product receives one or two stars. Each negative review is a hit to your ODR. As you've likely experienced during your time as an Amazon Seller, it can involve any step of the process, from the buying experience to delivery windows and even the state of your packaging.
Low reviews are inevitable when engaging in ecommerce on any platform, but consistently negative comments may be drawing the wrong kind of attention from Amazon to your storefront.
Improving ODR
If you notice your Order Defect Rate creeping toward that 1% mark, don't panic. You can take many steps right now to ensure your subsequent sales are positive experiences all around.
Read Your Reviews
You're likely already aware of any low reviews on your listings. However, they can undoubtedly drag down your confidence as an Amazon Seller!
Rather than hide from that tab forever, now is an excellent time to dig into the feedback and look for patterns. t. Are there any complaints that prior customers have had in common? For example, is a shirt consistently reported as too big? Was the delivery window incorrect? If there do not appear to be any similarities between reports, were you able to address all of the concerns, or have you been putting off resolving any outstanding issues?
In addition to discovering constructive feedback, take a moment to learn from your positive reviews. What did you do well in these interactions? Did you deliver the product arrive in perfect condition? Investing in what is going well for your business may help offset some unavoidable problems.
Look Over Your Listings
Now that you know what your customers think about your products look at how they came to have these expectations — by reading your listings. Pay special attention to any listings you may not have updated in a while and check them for accuracy. For example, let your customers know if your supplier is running behind on the necessary materials for a specific product or if their formula has changed. You might receive fewer negative reviews if your buyers know precisely what they are purchasing and when it should arrive.
Check the Calendar
Being an Amazon Seller this year hasn’t been the easiest. Between labor shortages and supply chain issues, getting products from warehouses to customers on time can feel like herding cats.
With the school year approaching and the holiday season further encroaching on autumn, now is an excellent time to look at your inventory and identify products that may become seasonal earlier than expected. In addition, it may be wise to order gifts and trinkets that take a while to produce now, so you know they will be in stock in time for Black Friday and other holiday sales.
If you notice inventory problems, update your listings to reflect delivery times and stocking backlogs immediately. The fewer returns and refunds filed over incorrect inventory, the better.
Support Where You Need It
Ecommerce can become a confusing maze of red tape and corporate jargon, primarily if you sell across multiple platforms. Let StoreAutomator help break through the jargon and headaches of multichannel commerce. Our product and order management tools allow you to take control of your products and distribution.
Want to know more? Request a live demo today to learn how StoreAutomator can help your sales soar.