A/B Tests Are The Key To Amazon Conversions. Here’s Why

James Andrews Uncategorized 1 Comment

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Your Amazon product listing conversion rate is one of the single most important metrics you should optimise. Recently we’ve been analysing data to see just exactly what’s at play here with Amazon’s A9 ranking algorithm when it comes to your conversions. This really has helped us improve the accuracy of our A/B tests on Amazon.

 

Amazon’s A9 Algorithm And Amazon Conversions

 

The first thing we wanted to prove was how long changes come into effect on rankings. For example, today you increase your conversions by slashing your prices by 50% – how many days do you have to wait to enjoy higher rankings?

 

Many sellers will argue that increasing your conversion rate suddenly will effect your rankings tomorrow. And that’s true – but only for some. There are many other factors that come into play with your rankings, such as a competitor regaining stock, so it is very difficult to isolate tomorrows effect caused by todays changes.

 

That being said we have a massive database which provides an entertaining playground for us geeks.

 

Here’s what we found.

  • If you double the total number of conversions today, on average the chance your product will enjoy more sessions tomorrow is about 58%. However, if you wait 15 days then you have a 97% chance of enjoying more sessions.
  • When you double the number of conversions, here’s the probability of your product climbing through the ranks and attaining a higher amount of sessions:

 

 

Note that we’re not quantifying the amount of sessions here, just the probability of your product gaining more sessions by some arbitrary amount.

 

We see that for the first 10 days 89% of products will experience a rank increase by doubling the number of conversions. One thing is for certain: Amazon uses a moving average to determine the ranking of a product based on the number of conversions.

 

Knowing this information, a seller could drop their prices and experience a boost in rankings, then quickly increase their prices while being in the highly ranked spot to enjoy temporary additional sales. So long as the profit made on the way back down is greater than profit lost on the way up – this would be a decent strategy to employ.

 

Conclusion

 

Amazon are interested in making a sale as quickly as possible and use a moving average of conversions based on previous history. The last 10 days are most important, but days greater than 10 still have an effect.

 

This phenomenon has a negative impact on our Amazon A/B split tests – because today’s rotation will be effected by yesterdays rotation by a small amount. We’re very conscious of the accuracy of our optimisation software. After all – you’re using it to improve your listings.

 

And one more thing. Having a higher conversion rate is great because you enjoy more sessions. However, this often comes at the expense on profit per unit sold so you need to be careful on striking the right balance.

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