How to Beat the Holiday Competition with Amazon Ads in Q4 2025

Q4 is the most important period for companies that sell products, and Amazon Ads has quickly become one of the most critical channels for reaching high-intent shoppers during peak buying seasons. With consumer spending concentrated in just a few months, getting your Amazon strategy right can make or break your entire year.

While marketers often rely on experience and intuition to guide Q4 planning, data is the gold standard for making decisions that actually drive results. The right data can reveal hidden opportunities, expose competitive blind spots, and unlock efficiency gains that experience alone might miss. A key insight discovered early enough can be the difference between a good Q4 and a record-breaking one.

Skai publishes research to help our clients and marketers use data to make smarter, more strategic decisions across commerce media. We’ve pored through three of our most important analyses from 2025 to see what insights we can share to help you get ahead of the holiday competition:

• 2025 State of Retail Media Report. Annual survey of 100+ retail media marketers revealing industry trends and gaps
• Prime Day 2025 Coverage. Real-time analysis of the biggest Amazon advertising event of the year
• Q2 2025 Quarterly Trends Report. Performance analysis across $8+ billion in advertiser spending

Here are nine strategic insights that should inform your Amazon Q4 planning right now.

What Skai’s 2025 State of Retail Media Report reveals about Q4 opportunity

Now in its fourth year, the 2025 State of Retail Media Report has become the benchmark for understanding retail media’s evolution. This comprehensive survey of over 100 retail media marketers at U.S. consumer product brands, manufacturers, and agencies reveals both remarkable growth and persistent execution gaps.

The numbers tell a compelling story: 92% of marketers rank retail media as their most important channel, yet only 24% have cracked cross-channel integration. Meanwhile, 94% see major opportunities in Connected TV, signaling where smart money is moving. These gaps represent your biggest opportunities heading into the holiday season.

Only 24% have cross-channel integration figured out, so take advantage of the opportunity

Most of your peers aren’t capitalizing on the synergy between Amazon campaigns and their paid search or social advertising. That makes cross-channel coordination one of your biggest competitive advantages. While seamless integration remains challenging (otherwise everyone would have figured it out by now), even simple coordination can unlock significant performance gains.

Start simple. Find out what your search and social teams are planning so you can align timing, messaging, and targeting. You might discover product pushes or major campaigns that never made it to your radar. This happens constantly in complex organizations, and the brands that break down these silos consistently outperform those that don’t.

The implications are clear: while 92% recognize retail media’s importance, the 76% who haven’t solved integration are leaving performance on the table. In Q4’s ultra-competitive landscape, coordinated Amazon campaigns will have significant advantages in reach, frequency, and attribution accuracy.

Amazon marketer action items:

1. Schedule cross-team planning sessions now. Meet with your paid search and social teams to understand their Q4 product priorities, budget timing, and creative themes before campaigns launch.
2. Offer Amazon Marketing Cloud insights to other teams. Share customer characteristics and behavioral data with Google and Meta teams so they can build lookalike audiences for consistent targeting across channels.
3. Propose unified measurement frameworks to leadership. Advocate for attribution models that account for cross-channel assists, so you can prove Amazon’s role in driving conversions that appear to come from other channels.

Marketers see opportunity in CTV, so get ahead of it this year 

It’s time to make this your CTV breakthrough quarter. Inventory will only get more expensive as adoption accelerates, so early movers benefit from better access and pricing.

Amazon DSP’s CTV capabilities offer unique advantages during the holiday rush: premium streaming inventory, first-party Amazon data for targeting, and the ability to drive both upper-funnel awareness and lower-funnel conversions. As consumer viewing habits shift toward streaming during holidays, CTV becomes critical for reaching high-intent shoppers during premium moments.

The window for Q4 CTV planning is closing rapidly. Streaming inventory gets reserved months in advance, and the best placements go to advertisers who commit early. This isn’t just about adding another format—it’s about reaching customers when they’re most engaged and receptive.

Amazon marketer action items:

• Reserve Amazon DSP CTV inventory early. Lock in rates and placement guarantees before Q4 demand drives up pricing and reduces availability.
• Create video creative assets specifically for streaming placements. Develop 15, 30, and 60-second video ads optimized for living room viewing experiences, not mobile.
•  Set up CTV audience targeting to complement Amazon campaigns. Use Amazon’s shopping behavior data to reach high-intent audiences during premium streaming moments
• Plan CTV budget allocation separate from traditional display. Treat CTV as its own channel with dedicated budgets, creative, and measurement approaches.
• Establish CTV measurement framework. Set up view-through attribution and brand lift studies to track upper-funnel impact beyond direct conversions.

Just 14% are excellent at incrementality measurement so capitalize on this gap to outmaneuver competitors

If only 14% of organizations are excellent at measuring incrementality for retail media, that means 86% of your competitors are flying blind when it comes to understanding what’s actually driving incremental sales. This isn’t just a measurement problem—it’s a competitive opportunity you can weaponize to outmaneuver competitors who can’t optimize intelligently.

Measurement guides optimization, bottom line. The brands that crack incrementality measurement can make data-driven decisions about budget allocation, creative performance, and audience targeting while their competitors rely on guesswork. This becomes even more critical during Q4 when every optimization decision impacts millions in revenue.

Focus on two phases: intra-event measurement to drive intelligent optimization during Black Friday and Cyber Monday, and post-event analysis to capture Q4 learnings for your 2026 strategy. While 86% of your competitors struggle with basic incrementality measurement, you can use real data to optimize campaigns in real-time and extract actionable insights for long-term planning.

Amazon marketer action items:

1. Set up incrementality testing frameworks before Q4 begins. Establish holdout groups and control mechanisms now so you can measure true lift during peak season while competitors rely on last-click attribution.
2. Create real-time incrementality dashboards for intra-event optimization. Build measurement systems that can guide budget reallocation decisions during Black Friday week, not weeks later.
3. Plan post-Q4 incrementality analysis for 2026 strategy. Design measurement frameworks that will capture learnings about audience performance, creative effectiveness, and channel synergies to inform next year’s planning.

What Skai’s Prime Day 2025 coverage reveals about Q4 potential

This year’s Prime Day event generated more revenue than any Black Friday in history. Summer’s Prime Day has become the best predictor of Q4 performance, especially with October’s second Prime Day creating even more complexity around holiday planning. Our Prime Day 2025 analysis covers performance across all Skai Amazon Advertising accounts globally, representing billions in ad spend and providing unprecedented insights into advertiser behavior during peak retail moments.

Prime Day 2025 delivered record-breaking efficiency gains while maintaining growth, proving that strategic preparation and smart execution can achieve scale without sacrificing performance quality. These lessons apply directly to Q4 planning, especially as consumer behavior during Prime Day often previews holiday shopping patterns.

CPC fell 10.4% while CTR rose 33.3% on Prime Day

Prime Day 2025 became the year of efficiency, and that should inform your entire Q4 approach. Cost-per-click fell 10.4% to $1.80 while click-through rates rose 33.3% to 0.32%, proving that advertisers achieved better results at lower costs through strategic optimization and preparation.

This efficiency breakthrough happened because advertisers focused on strategic preparation rather than throwing money at the event. Better targeting, improved creative, and smarter bidding strategies all contributed to getting more engagement for less investment. These same principles will be crucial for Q4 success.

The efficiency gains weren’t accidental. They resulted from months of preparation, testing, and optimization that paid off during the peak event. The brands that invest in similar preparation for Q4 will see similar efficiency advantages over competitors who wait until the last minute.

Amazon marketer action items:

1. Set efficiency benchmarks for Q4 campaigns based on Prime Day data. Use Prime Day’s CPC and CTR improvements as targets for your holiday campaigns, proving that efficiency gains are possible even during peak competition.
2. Optimize product listings and creative to capture higher engagement. Prime Day’s CTR gains came from better relevance and appeal, so audit your product pages, images, and ad creative now before Q4 traffic increases.
3. Plan strategic bidding approaches based on efficiency improvement trends. Prime Day proved that smart bidding can reduce costs while increasing performance, so develop bidding strategies that prioritize efficiency over simple volume.

DSP grew from 13.6% to 17.9% of ad mix in just four days

Amazon DSP is rapidly becoming the most important format to master in Amazon Ads. Sure, 70% or more of spending still goes to Sponsored Products, but that’s essentially a binary format requiring shoppers to search on your terms. It’s primarily a lower-mid and bottom-funnel tactic where consumers need to know the brand, category, or product to trigger an ad.

Amazon DSP operates as a full-funnel solution that can stimulate upper-funnel awareness, nurture consideration (even when shoppers think they want a different solution entirely), and drive bottom-funnel conversions. You can deploy it both offsite and onsite, making it the most versatile tool in Amazon’s advertising arsenal. During Prime Day 2025, DSP grew from 13.6% of the advertising mix on Day 1 to 17.9% on Day 3, demonstrating its rising strategic importance.

The growth isn’t just about budget allocation. DSP’s rising prominence reflects a fundamental shift toward full-funnel thinking in Amazon advertising. Brands are realizing they can’t rely solely on capturing existing demand—they need to create it.

Amazon marketer action items:

1. Increase Amazon DSP allocation for Q4 full-funnel campaigns. Shift budget from Sponsored Products to DSP to capture shoppers before they know what they’re searching for, especially important during holiday browsing periods.
2. Plan DSP creative assets for both awareness and retargeting. Develop creative strategies that work for cold audiences (awareness) and warm audiences (retargeting), as DSP serves both functions effectively.
3. Set up DSP audience segments for holiday shopping behaviors. Create custom audiences based on seasonal shopping patterns, gift-giving behaviors, and holiday category interests that you can’t target through search-based campaigns.

Ramp-up spending went from much higher to only 3X event spending

Ramp-up timing is now critical, and savvy advertisers have taken notice. During Prime Day 2025, brands spent nearly three times more per day than in the 30 days prior. While still significant, that gap was even larger in past years. The shift shows advertisers now see ramp-up as essential preparation time, not just a warm-up.

Don’t get caught underinvesting during the ramp-up to Q4. This period serves multiple purposes: optimizing campaigns before peak traffic, building momentum with Amazon’s algorithms, and capturing early holiday shoppers who start browsing before major events. Treating ramp-up as just preparation means missing significant opportunities and arriving at peak season with unoptimized campaigns.

The algorithm momentum factor is particularly important. Amazon’s systems need time and data to optimize performance. Starting campaigns with meaningful budgets during ramp-up gives the platform time to learn and improve before your biggest traffic days arrive.

Amazon marketer action items:

1. Plan substantial ramp-up budgets starting in October. Allocate meaningful spend (not just test budgets) during the 4-6 weeks before Black Friday to build campaign momentum and optimize performance.
2. Use ramp-up period for campaign optimization. Treat October and early November as optimization time, testing and refining targeting, creative, and bidding before peak competition begins.
3. Build algorithm momentum during ramp-up. Amazon’s algorithms need time and data to optimize, so start campaigns early enough for the system to learn and improve before your biggest traffic days.

What Skai’s Q2 2025 Quarterly Trends Report reveals for Q4 strategy

We’ve been publishing quarterly trends analysis for over 15 years. That’s 60+ reports tracking the evolution of commerce media across retail media, paid search, and social advertising. Our Q2 2025 analysis draws from over $8 billion in ad spending across more than 3,000 advertiser and agency accounts, providing unmatched visibility into real performance patterns.

Q2 data showed retail media maintaining its 18% year-over-year growth leadership while social advertising demonstrates platform resilience through strategic diversification. These trends provide crucial context for Q4 planning, especially as consumer behavior and platform dynamics continue evolving at breakneck speed.

18% growth means the competitive rules keep changing

Retail media sustained its 18% year-over-year growth advantage while paid search showed foundational stability. This category continues outpacing every other channel, which means the competitive rules keep changing. What worked last Q4 may not be sufficient this year due to increased competition and evolving platform capabilities.

Sustained growth creates both opportunities and challenges. The expanding market means more total opportunity, but also more brands competing for the same inventory and audiences. When growth rates hit 18%, early preparation becomes even more critical as competition intensifies.

Think about it: if retail media is growing 18% annually, standing still means you’re actually losing ground. Your competitors are increasing their investments, which means you need to match or exceed that growth just to maintain position.

Amazon marketer action items:

1. Increase Amazon advertising budgets proportionally to market growth. If retail media is growing 18% year-over-year, your budgets should reflect this growth to maintain competitive position and market share.
2. Lock in Amazon campaign structures early. With more brands entering the space, reserve your preferred keywords, audiences, and inventory before competition intensifies in Q4.
3. Plan for higher competition and potential CPC increases. Build buffer budgets and efficiency targets that account for increased competition from the influx of new retail media advertisers.

Your Q4 ad format mix will make or break holiday performance

Amazon’s ad format landscape shifted dramatically in Q2 2025. DSP surged ahead while Sponsored Display pulled back, and the implications for Q4 planning are massive.

The data tells a clear story: Amazon DSP spend hit its highest share yet, climbing to over 20% of total Amazon investment, while Sponsored Display allocation dropped significantly. This isn’t random shuffling. It’s strategic reallocation from advertisers who’ve figured out that Q4 success depends on capturing demand at every stage of the holiday shopping journey.

Here’s what most marketers miss about format mix during peak season. Holiday shoppers don’t convert on first touch anymore. They discover through DSP campaigns, research through Sponsored Brands, and finally convert through Sponsored Products. The brands dominating Q4 sales are the ones with budgets allocated proportionally across this entire sequence.

The cost dynamics are shifting too. Sponsored Display became the lowest-cost format by a wider margin, offering efficiency-focused marketers room to scale without inflating costs. But the migration toward DSP reveals something more important: reach and full-funnel impact have become more valuable than pure efficiency when it comes to holiday planning.

Amazon marketer action items:

1. Audit your format allocation now. If you’re still heavily weighted toward Sponsored Products without meaningful DSP investment, you’re missing the upper-funnel opportunities that become critical during holiday shopping.
2. Reallocate budgets toward proven winners. Follow the Q2 pattern: increase DSP for awareness and consideration while maintaining strong Sponsored Products for conversion.
3. Test format handoffs before peak season. Use Q3 to optimize how DSP awareness campaigns feed into Sponsored Products conversion campaigns, so you’re ready to scale when holiday traffic spikes.

Amazon’s targeting intelligence is your secret weapon across all channels

The real reason advertisers doubled down on Amazon DSP in Q2 wasn’t the inventory. It was the targeting capabilities powered by Amazon’s first-party shopping data. And here’s the opportunity most marketers are missing: this same data can transform performance across your entire media mix.

Amazon DSP spend jumped to over 20% of total Amazon investment while account adoption stayed flat. That gap reveals something important. Existing advertisers discovered that Amazon’s behavioral targeting creates competitive advantages extending far beyond Amazon campaigns.

Amazon Marketing Cloud knows what your customers actually buy, when they buy it, what they browse but don’t purchase, and how their shopping behavior changes seasonally. Smart marketers are already using this intelligence to build better customer segments for Google, Meta, and other channels. It becomes especially valuable for Q4 when targeting precision determines whether your campaigns cut through the holiday noise.

Consider the missed opportunity here. While 92% of marketers rank retail media as their most important channel, only 24% have solved cross-channel integration. The 76% who haven’t figured this out are leaving serious performance on the table.

Amazon’s first-party data offers the solution. It provides the customer intelligence you need to optimize targeting across your full media ecosystem, right when Q4 competition makes that intelligence most valuable.

Amazon marketer action items:

1. Export audience insights for cross-channel targeting. Use Amazon Marketing Cloud data to identify high-value customer characteristics, then build similar audiences for prospecting campaigns on Google and Meta before Q4 competition heats up.
2. Share search behavior with other teams. Amazon search query insights can inform keyword strategy and content planning across your entire digital presence. This becomes especially valuable for Q4 planning.
3. Use Amazon’s seasonal signals to time other channels. Amazon provides early indicators about category trends and consumer behavior shifts that help you optimize campaign timing on other platforms throughout the holiday season.

Bonus for Skai clients only: Get ahead before mass AI adoption happens

This might be the last year you can gain a competitive edge through AI before mass adoption levels the playing field. By next year, every marketing organization will be light-years ahead with AI compared to where they are now. Skai’s Celeste AI is the first GenAI-powered agent purpose-built for commerce marketers, now generally available to all Skai clients.

Clients reported performance improvements ranging from 30% to 50%, with tasks that once took marketing teams an entire day now completed in under a minute. Celeste leverages Generative AI to accelerate decision-making, empowering businesses to optimize investments across retail media, paid search, and social commerce.

Named for the inspiration celestial illumination symbolizes, Celeste aggregates signals from 200+ publishers, competitive insights, and cross-channel performance to deliver tailored recommendations. It’s like having an always-on, seasoned marketing analyst who never sleeps.

For Skai clients, you can access Celeste now and run these strategic prompts specifically designed for Amazon Q4 preparation:

10 Celeste AI Prompts for Amazon Q4 Planning

Advanced performance analytics

1. “What’s the optimal budget reallocation strategy across my Amazon portfolio to maximize incremental ROAS by product category for Q4 seasonality?”
2. “Analyze my Amazon DSP cross-campaign attribution—which awareness campaigns are driving the highest lift in Sponsored Products conversion campaigns for holiday shoppers?”

Strategic business intelligence

3. “Build a comprehensive Q4 competitive analysis: where are we winning vs. losing against key competitors in our Amazon categories during peak season?”
4. “What’s our customer lifetime value by Amazon acquisition channel, and which campaign types drive the highest-value holiday shoppers?”

Advanced targeting and optimization

5. “Create a holiday lookalike expansion strategy: which audiences similar to our top Q4 converters should we target with Amazon DSP for Black Friday?”
6. “What’s the optimal Amazon bid strategy by product lifecycle stage specifically for Q4 (new launches vs. mature products vs. clearance items)?”

Predictive analytics and forecasting

7. “Forecast Q4 2025 Amazon performance by campaign type and recommend pre-emptive budget shifts for holiday seasonality patterns.”
8. “Model the impact of various Q4 Amazon budget scenarios ($500K, $1M, $2M) on market share and competitive positioning during peak season.”

Real-time optimization

9. “Create an automated Q4 alert system: what Amazon performance thresholds should trigger immediate budget reallocation during Black Friday week?”
10. “Analyze my Amazon campaign portfolio mix optimization: what’s the ideal balance between Sponsored Products, DSP, and Sponsored Brands to maximize Q4 profitability?”

These prompts leverage Celeste’s ability to unify insights across Amazon’s advertising ecosystem while providing the strategic depth needed for complex Q4 planning decisions.

Conclusion: Act on insights while your competitors are still planning

The nine insights from Skai’s 2025 research reveal a clear pattern. Brands that will dominate Q4 are taking action now on strategic preparation, format diversification, and cross-channel coordination. From the cross-channel integration opportunity that 76% of marketers are missing to the efficiency breakthroughs that made Prime Day 2025 a record-setter, success comes from early preparation and strategic thinking.

The window for Q4 preparation is closing rapidly, and the competitive advantages go to those who act on data-driven insights today rather than waiting for the holiday rush to begin.

Skai’s Retail Media solutions enable marketers to plan, activate, and measure campaigns across 200+ retailers—including Amazon, Walmart, Target, and Instacart—as part of a broader commerce media strategy. AI-powered pacing, product intelligence, and keyword tools help teams meet shoppers across the journey and tie spend to sales with confidence.

Ready to turn these insights into Q4 success? Schedule a quick demo to see how Skai can help you get ahead of the crowd this holiday season.

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