University - Customer Experience
Seller Performance Measurements
Because Amazon is a marketplace that provides buyers with seller services, the site’s main goal is customer satisfaction. As such, sellers are rated based on their performance, and a range of seller performance measurements exist. A poor rating level can result in termination of the seller’s account.
As well as overall performance and customer service, the seller rating is calculated according to specific seller performance measurements and metrics. The following is a list of targets that the seller should aim for consistently:
- An Order Defect Rate (ODR) of less than 1%: The order defect rate is measured based on a combination of the negative feedback received, number of A-to-Z claims made, and chargebacks processed. Note that even a one- or two-star rating falls into the category of a negative rating.
- A pre-fulfillment cancel rate of less than 2.5%: Pre-fulfillment cancellations are those initiated by the seller prior to shipment confirmation. The rate is calculated based on the number of these cancellations divided by the overall number of orders placed within a given period of time. Reason for cancellation is irrelevant within this calculation.
- A late shipment rate of less than 4%: Late shipment rates are calculated based upon the number of orders that received an overdue status exceeding two days divided by the overall number of orders during a given period of time. Consistently shipping orders late is a sign of poor business standards or unprofessional habits and procedure.
- Negligible refund rate: Refunds that are initiated by the seller, regardless of reason, are held against the overall number of orders for a given period of time to reach the refund rate.
These metrics are used because the presence or lack thereof portrays an accurate picture of the seller’s performance standards, quality and general attitude towards customer service. Note that a seller who continuously scores below these values is likely to lose selling privileges on Amazon.
Monitoring Seller Performance
Amazon regularly monitors all sellers’ performance and informs them when they reach an unsatisfactory level. If a seller does not improve within the allotted amount of time, and sometimes sooner, Amazon reserves the rights to revoke selling privileges. Find out how a seller can Appeal the Removal of Selling Privileges by providing concrete ideas as to how he will improve the quality of performance.
Sellers can monitor their own performance by checking the Customer Metrics tool regularly. This tool can be found in the seller account and offers insight into all the applicable metrics that a seller needs to be aware of. Read Customer Metrics FAQs for more information about reading and meeting satisfactory metrics.