Amazon officially announced this year’s Prime Day will take place on June 21-22.
Last year, Amazon Prime Day was a record-breaking event for small and medium businesses worldwide, with third-party sellers generating sales surpassing $3.5 billion—an increase of nearly 60% from last year. Last year, Jeff Wilke, CEO Worldwide Consumer, stated: “We’re proud that Prime members saved more than $1.4 billion, and we look forward to providing more opportunities for our selling partners to grow and customers to save throughout the holiday season.”
On Prime Day, marketers and sellers should take advantage of every opportunity to showcase their brand & products to increase sales and gain new customers.
What is Amazon Prime Day?
Amazon Prime Day is Amazon’s worldwide online shopping event that occurs annually in July. Prime Day marks a two-day discount fest characterized by discounts on almost everything, including premium brands such as Nike, Apple and Amazon’s own products such as Alexa and Kindle. To be able to use the highest discounts you must be or become a Prime Member, albeit some are available to those who are not.
Amazon uses smart marketing psychology during the event. Deals regularly sell out, which creates the feeling of scarcity. In addition, many temporary deals will be launched during the two days that are only available for a very short time. In order not to miss anything, customers can enable notifications. Marketers could smartly play into customers enabling notifications by advertising products with great discounts. From a business point of view, it is cleverly implemented: the margin and commission that Amazon misses due to the high discounts are more than compensated by the number of new app installations and the number of new Prime Members.
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Why Amazon Prime Day?
The first Amazon Prime Day took place on July 15, 2015, a very successful marketing campaign to celebrate Amazon’s 20th anniversary. Prime Day kills two birds with one stone: It gives sales a boost in a summer month that is usually characterized by a small dip in sales. At the same time, it is driving a massive increase in the number of Prime Members, driving the campaign to deliver short-term sales as well as customer lifetime value (CLV) and medium-to-long-term loyalty to Amazon.
Amazon Prime Day 2021
4 factors play an important role in being successful as a seller during the event:
- The price of your products, or rather the discount percentage.
- The stock behind these products.
- The right content.
- How well you promote your deals through advertising.
By devising a product and pricing strategy and calculating margins properly, the event is not only a party for the consumer and Amazon itself, but can also be a profitable event for Amazon vendors and sellers.
The best way to predict the best Amazon Prime Day deals for 2021 and to create a competitive promotion strategy, is to take a look at last year’s offerings, where you will find all offered discounts that were available back then, so you can benchmark your expectations. The largest price slashes are typically internal. According to Amazon, the best-selling products in 2020 globally were Amazon’s own devices: the Echo Dot and Fire Stick 4K.
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Vipin Porwal, consumer expert at Smarty, predicted that health and wellness products will see discounts this year. “Expect competitive Prime Day deals ranging from 20 to 30 percent off items like air purifiers, massage therapy, home fitness gear and activewear,”
Why your business should be prepared for Prime Day
Prime Day is all about one thing: promotional discounts! The right price, or even better, the right price perception, makes or breaks the success of your Prime Day campaign. The consumer must have the idea that he or she is being presented with a unique opportunity. During Prime Day, you can give a discount as a brand with minimal to no damage to your brand identity because everyone is doing it. It pays not to discount your entire range. This has two advantages: you can use it to steer towards products that you as a brand or retailer would like to sell. In addition, presenting discounted products next to full price products ensures a high perception of the discount percentage.
How much discount you have to give depends on several things: the industry, the competition, whether a discount is normally also given, your margin and stock position.
What kind of promotions can be run?
Sellers could take advantage of the many possible promotions Amazon offers to make use of. Following is a quick refresher on a few important seller promotions to consider:
- Lightning Deals
- Lighting Deals are 10 hour flash sales, and a highly effective way to drive demand and incremental sales, boost sales ranking, or clear through inventory. They are best used when you are expecting to sell a high volume of products through them. In order to have a chance to appear on the main Lighting deals page, we recommend having ample inventory.
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- Percentage Off
- A tiered discount to persuade customers to purchase more to get higher discounts, and is effective for sellers that want to sell excess inventory.
- Coupons
- Digital coupons that showcase discounts and promote your products, which allows sellers to offer a percentage off an item.
In addition to the above, you can help to give your products an extra visibility boost by running Sponsored Ads campaigns, such as Sponsored Product, Brand, or Display ads campaigns.
Do you want to learn more about Amazon Marketing & Management and how to best utilise it to get optimal results for your business? Contact us now or either consult our Amazon marketing services page.
