Imagine how much better your Amazon Advertising strategy for Prime Day 2021 would be if you already knew what was going to happen? You could make the right choices, be confident in your decisions, and avoid common pitfalls. Most importantly, you could maximize your marketing return for this important shopping holiday.
For product companies, Prime Day has become one of the most important shopping holidays of the year. It’s estimated that last year’s Prime Day generated $10.4 billion globally over the two-day event, up 45.2 percent from $7.16 billion in 2019. Due to last year’s pandemic, Amazon shifted the event to October, but Prime Day 2021 is once again back in the summer.
While marketers are able to optimize their Amazon Advertising programs throughout the three months of Q4’s end-of-the-year holiday shopping season, Prime Day represents a unique challenge because of how short it is. Marketers have to put their best foot forward because there isn’t much time to make any changes. That doesn’t mean practitioners aren’t going to be glued to their hourly results to make changes throughout the event. They will be.
But, it’s important to show up with the best Amazon Advertising plan possible to maximize sales and revenue. And that’s not always easy to do.
Prime Days Results and Insights
Skai’s Senior Director of Marketing Research, Chris ‘Coz’ Costello, analyzed Prime Day campaign performance through Skai over the last several years in order to better understand what might happen during this year’s event. This Prime Day research includes nearly a billion dollars of Amazon advertising spend hosted on the Skai platform from June 2018 through December 2020.
“While 2020 was an anomaly in many ways, we can still guide the future by the past by looking across historical data,” says Costello. “It may not perfectly represent your situation, but it gives us a baseline we can use to contextualize our current programs.
You can catch Costello’s analysis along with expert tips and tricks on how to take advantage of these data-driven insights to improve your Prime Day 2021 plans by either:
- Download the complimentary Skai report, The Key To Prime Day Success: Insight To Impact
- Watch him present his findings in a webinar with a panel of Skai’s Amazon Advertising experts offering tips and tricks to maximize Prime Day results
Prime Day Insight #1 – Prime “Day” is actually a 3-week shopping event
By looking at weekly data going back to Prime Day 2018, we can see clear spending and pricing patterns around the event. One thing that sticks out is the spending spike is more narrowly focused on just the week of Prime Day, compared to the holiday season, which has a more gradual increase.
Historically, advertiser spending increases the week of Prime Day, but also the weeks before and after. This is because brands have traditionally begun offering deals not just during the event but also the surrounding days too. Make sure to plan around those three weeks, not just for the two days, of Prime Day
Prime Day Insight #2 – More shoppers = more ad inventory…but no need to overbid
While it’s true that increasing prices are one reason why spending goes up on Prime Day, it’s not the only reason. In fact, the increase in clicks plays a larger role and this has been consistent for each of the last three events. Advertisers are increasing investments in Amazon Advertising during Prime Day year-over-year. If you aren’t significantly increasing your budget in 2021, you may leave money on the table.
With the increased number of shoppers on Amazon during Prime Day, there are more ads, and thus more clicks. But, as you can see, click costs don’t significantly increase. You will need to bid a bit more aggressively than normal, but there’s no reason to dramatically overbid in order to drive Prime Day ad clicks.
Prime Day Insight #3 – With conversion rates flat, it’s Average Order Size (AOS) that drives positive ROI
Total conversions spike on Prime Day every year, but the conversion rate actually stays fairly flat. This may be counterintuitive to what we know about big shopping periods when conversion rates generally go up.
There might be two main drivers of this: First, shoppers flock to Amazon.com during Prime Day in a deal-hunting mindset. This means they may be clicking around looking for deals the same way that in-store shoppers might walk around a store to take in all of the sales before they put something in their cart. Secondly, once a shopper decides that they want to buy an item, they may do some last-moment comparisons to evaluate which specific item to buy. These two behaviors could both be contributing to the fact that conversion rates don’t spike during Prime Day.
Focusing too much on either conversion rate or cost-per-acquisition (CPA) can lead you to think you may be sacrificing performance for volume. However, for many advertisers—and for all advertisers in aggregate—shoppers are buying more per transaction, which leads to a favorable Return-on-Investment (ROI). Average order size (AOS) also spikes during Prime Day, which can offset the increase in click costs, spike in cost-per-acquisition, and flat conversion rate.
Are you ready for Prime Day 2021?
During the Prime Day frenzy, how do companies make sure their products stand out?
Imagine an aisle in a physical store that is a mile long—perform any search on Amazon and there could literally be hundreds or thousands of product results to sift through. As amazing of an opportunity that Prime Day represents, it can be easy for brands to get lost in the shuffle. Amazon Advertising is clearly the best way for a product company to ensure visibility with shoppers as they search for items.
Skai Retail Media helps simplify your Amazon Advertising programs with powerful features to automate repetitive tasks. This drives operational efficiency by streamlining time-consuming workflows so you have more time in your day to focus on the valuable strategic tasks that can really make a difference.
If you’re ready to see what’s possible and learn how you can go well beyond the results you’re achieving today, we’d love to walk you through a demo of Skai Retail Media.
Contact us today for a consultation.