If there’s one thing all Amazon sellers must be worried about, it’s the Order Defect Rate (ODR). This metric is one of the most vital measurements tracked by Amazon, used to measure your health as a seller.
It can decide who will win (or lose) — the special Amazon Buy Box.
It occasionally gets accounts deactivated.
It constantly keeps tabs on which sellers are providing positive consumer experiences — and who’s failing to fulfill consumer expectations.
It’s strict and terrifying, but not at all unfeasible to master. Once you have a tough understanding of how the Amazon Order Defect Rate works, it can become extremely simple to excel at this all-important metric.
Here are the basics that every seller requires to recognize:
How does the Amazon ODR work?
Your Order Defect Rate is used by Amazon to calculate your performance based on the percentage of orders that get negative feedback. It’s measured using three components:
- Your A-to-z claims, which are made by consumers when orders are unacceptable or delivery is very slow.
- Any negative feedback, comprising comments and ratings.
- Your credit card chargeback or the number of times you refund orders.
These three factors come jointly to decide your overall Order Defect Rate. Amazon takes into account your A-to-z claims, negative feedback and credit card chargeback, and then divides it by the total number of orders throughout a given 60-day period.
Thus if you received one A-to-z claim and two negative customer feedbacks across a total of 100 orders placed in June, your ODR is 3%.
Which, for the record, is far too high, to continue selling on Amazon, sellers have to maintain an ODR below 1%.
Although, there is a bit of silver lining. Any time you obtain one A-to-z claim and one negative feedback for the same order, these are measures as one factor; not two. Thus if you notice a small difference between your ODR and the total number of A-to-z claims and customer feedback, it’s possibly because the same consumer made an A-to-z claim shortly before posting negative feedback.
Still, every piece of negative feedback is one more claim you can’t afford.
Violating that 1% threshold is more than a little treacherous. So earlier we dig into strategies for improving your ODR, it pays to understand what makes this single metric so dangerous.
What happens if your ODR reaches 1%?
Primarily, you lose the Buy Box automatically for any products you’re liable for shipping. Amazon’s aim is to secure the consumer experience and preserve buyers’ trust in the Buy Box. If your orders are defective, Amazon’s reputation is at danger.
Next, Amazon can deactivate or terminate your account promptly, holding payments in order to refund customers. Amazon is extremely strict on Order Defect Rates, so your relationship with Amazon is at danger the moment your ODR reaches 1% — no matter how big or successful you are.
Deactivation happens when your Order Defect Rate is slightly over 1%. After seller rights are removed, you have 17 days to come back with a plan of action to be reinstated.
But if your ODR is considerably over 1%, Amazon views it as a sign that serious issues are at play — things like extremely late deliveries and numerous cancellations, which have a direct impact on how customers will view the marketplace itself.
This is why that 3% we mentioned previous could be more than a little ruinous. Instead of a temporary suspension & appeals process, your account could be deactivated altogether.
How can you improve your Order Defect Rate?
While there’s an extensive range of marketing, selling and fulfilling activities to consider, a couple of key elements will always be at play when it comes to your Amazon Order Defect Rate.
Initially, assess and address feedback. We strongly suggest cautiously reading ALL A-to-z claims and customer feedback — the primary drivers of your ODR — to discover what’s causing them. Is it late shipments, cancellations or mismatched expectations?
If you find a frequent problem, make it a top priority. The earlier you overcome any issues, the less possibility they’ll have to impact your rating. If you sell overseas, make certain you can translate and know all A-to-z claims and customer feedback.
From time to time, you may come across customer feedback that comprises obscene language or personally identifiable information. Or you might find a misplaced review that’s planned for the product itself, or that addresses issues around an order fulfilled by Amazon. In these circumstances, just inquire Amazon (via Seller Central) to edit the feedback so it won’t impact your ODR.
Next, make prompt and free shipping a top priority. If there’s one thing that’s bound to result in negative feedback, it’s late delivery. Whether you fulfill orders in-house or rely on third-party logistics, take pains to guarantee minimal handling times and trustworthy shipment tracking.
Some sellers choose to use FBA (Fulfillment by Amazon) after an ODR-induced deactivation since it assures Amazon’s strict requirements will be met and can help products reappear in the Buy Box promptly. You can even use it for a small selection of your best-selling products, for a limited time period.
Keep in brain, too, that many customers post A-to-z claims and negative feedback in January because of late deliveries during Christmas. Your Order Defect Rate could be well under 1% all year, and then abruptly skyrocket if you fail to plan ahead for the end-of-year holiday rush. For this cause, it’s especially very important to optimize your fulfillment during Holidays.
In conclusion: There’s never a time to end prioritizing your Order Defect Rate on Amazon. Whether you’re working to overturn a high ODR or are being proactive about keeping it below 1%, the above tips will help.