It is impossible to do well on Amazon without a healthy account. Amazon wants the best possible shopping experience for its customers, holding sellers to high standards to achieve this goal. Violating any of Amazon’s policies negatively affects your Amazon account health, leading to listing suppression and in some cases suspension.
In response to feedback, Amazon recently made updates to their Account Health Rating (AHR) feature to help sellers quickly assess their account health. These new features make it easier to monitor performance and quickly measure and improve account health.
Which Factors Affect Amazon Account Health?
Monitoring certain factors can help you identify and address issues before they negatively affect your Amazon account. Amazon uses three categories to assess the health of your account:
- Customer service performance
- Policy compliance
- Shipping Performance
Maintaining high performance in each of these categories means a seller is providing an excellent experience for the customer. Amazon rewards these efforts with higher rankings and greater visibility.
Customer Service Performance
Amazon uses order defect rate, or ODR, to measure this metric. An order has a defect if it results in negative feedback, an A-to-Z claim, or a chargeback. The goal is an ODR of less than 1% of all orders within a given 60-day period.
Customer feedback is considered negative if they leave a review of two stars or less. An A-to-Z guarantee claim is made if a customer feels the seller has not properly addressed a negative experience. Chargebacks are when the order amount is refunded to the customer due to a dispute or claim.
Product condition and shipping times have the greatest impact on customer satisfaction. Amazon recommends using adequate product packaging and trackable shipping methods and notifying customers immediately if a product is out of stock. As we discussed in the post Use E-Commerce Returns to Drive Growth, even negative feedback can be beneficial when used to update listings to set clearer expectations for the customer.
Policy Compliance
Amazon’s policies help make the marketplace safe for buyers and fair for all sellers. It’s the responsibility of every seller to review Amazon’s policies as well as state and local laws to make sure listings are compliant. Amazon will issue warnings of a policy violation which sellers may either appeal or dispute. Documentation requests for appeals will appear in the Amazon account health dashboard under the product compliance request section.
The aim is to have zero policy compliance issues on your account. Amazon noticed some sellers were disinclined to respond to violations until they faced deactivation, so they’ve created a color-coded indicator to quickly communicate the health of your account. Yellow signifies outstanding violations that must be addressed as soon as possible, and a red banner at top of page alerts sellers of deactivation with steps to take to reactivate.
Shipping Performance
Sellers must provide customers with the information they need after they place an order. The Late Shipment Rate is the percentage of confirmed orders after the expected shipping date. If you wait beyond the expected ship date to confirm the order, the order is considered a late shipment.
The Pre-Fulfillment Cancel Rate is the total percentage of orders cancelled by the seller in a given 7-day period. This metric does not include cancellation requests initiated by the customer. It is critical to keep inventory levels up to date to avoid these cancellations.
Customers use tracking numbers to track their shipments. The valid tracking rate or VTR represents the number of packages with a valid tracking number within a 30-day period. A valid tracking number must include the name of the carrier, type of delivery, and tracking ID. Amazon recommends using carriers that report tracking information back to Amazon. There are many fulfillment options available, so develop a robust fulfillment strategy to avoid out of stock or late shipment violations, especially during the busy Q4 holiday season.
If you fulfill orders yourself, you must keep your Late Shipment Rate below 4%, your Pre-Fulfillment Cancel Rate below 2.5%, and your VTR above 95%. Fulfillment by Amazon (FBA) orders do not impact your shipping performance.
Amazon Account Health Visibility
As mentioned above, Amazon launched a color-coded guide to help sellers see in a glance whether they have outstanding violations that need to be dealt with. Green indicates a healthy account, yellow indicates potential violations which must be addressed, and red indicates a suspension or deactivation. Amazon also has plans to introduce a numerical value for sellers in the US and Canada to track their Amazon account health rating more closely.
Details of violations are available in Seller Central under the Account Health tab.
How to Improve Amazon Account Health
Amazon recommends sellers visit their account health dashboard on a daily or weekly basis to check for potential violations. Amazon Violations have 4 stages:
- Low
- Medium
- High
- Critical — qualifies account for immediate deactivation.
Under the numerical system, Amazon will provide a baseline score for new sellers with the ability to increase the numerical rating over time by maintaining the standards outlined above and recover lost points by addressing violations.
To address violations, sellers have two options:
- Appeal: An appeal indicates you understand the violation and you have taken steps to prevent from occurring.
- Dispute: A dispute is appropriate if you believe Amazon is mistaken and there is no violation.
Obviously, avoiding violations is ideal, but if a violation does occur it is important to address it as soon as possible. Amazon provides a submission status indicator next to any violation you see on the page which will let you know if the submission is in review and whether any additional documentation is needed.
The Benefits of a Healthy Account Rating
As mentioned, Amazon rewards compliance with higher ratings and more visibility, yet the benefits of monitoring your Amazon account health go beyond pleasing the algorithm. Tracking account health helps you understand and prioritize policy violations to proactively manage your account health. It also provides further insight into customer satisfaction and expectations, which can be used to improve your product listing pages and performance.
Monitoring account health can be an arduous task, which is why some Amazon agencies include this service as part of brand protection. Whether or not you enlist the help of an Amazon agency, monitoring your Amazon account health is a crucial part of a successful Amazon strategy.
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