Why Amazon Prime Day 2023 Succeeded

Why Amazon Prime Day 2023 Succeeded

by Morgan Reilly Amazon

Are you ready for the next Amazon Prime Day, which will probably happen this fall? Based on the results of the July 11-12 Prime Day, you should be. Amazon reminded everyone that the company is the top dog in e-commerce despite challenges from the likes of TikTok and Walmart. Businesses that prepare for Prime Day properly will benefit.

Amazon Prime Day Results

According to data from Adobe Analytics, the recent two-day event that occurred on July 11 and 12 witnessed a remarkable increase in year-on-year spending, reaching $12.7 billion in the United States, with a surge of 6.1 percent.

During this event, Prime members globally indulged themselves in purchasing over 375 million products, taking advantage of Amazon’s discounted deals and saving an impressive amount of over $2.5 billion.

The average Prime Day spend per order is $56.64, up from $53.14 in the same reporting period on Prime Day 2022, according to data firm Numerator.

What People Bought

Throughout the span of the two-day event, various categories played a significant role in propelling online sales. Notably, appliances accounted for 45 percent of the sales, followed by housekeeping supplies at 28 percent, and electronics at 18 percent. Additionally, there was a noticeable increase in the popularity of apparel, experiencing a growth of 17 percent, and stationery/office supplies, skyrocketing by an impressive 76 percent. These surges were partially fueled by the influx of back-to-school shoppers.

How People Shopped

Consumers exhibited a growing inclination towards adopting flexible approaches in managing their expenditures. Buy Now Pay Later (BNPL) orders experienced a significant surge on both days of the event. On July 11, BNPL constituted 6.4 percent of online orders, resulting in a remarkable revenue of $461 million. This marked an astounding 19.5 percent increase compared to the corresponding day of last year’s Prime Day event. Similarly, on July 12, BNPL accounted for 6.6 percent of online orders, generating $466 million in revenue and demonstrating a notable growth of 21 percent compared to the second day of last year’s event.

Online sales were predominantly influenced by smartphones, accounting for nearly half of the total sales at 46.5 percent. This figure has seen a growth from the previous year’s 43.7 percent, indicating an upward trend in consumer confidence when it comes to shopping on smaller screens. The increase in smartphone-driven sales can be attributed to both the growing comfort of consumers with mobile shopping experiences and the prevalence of last-minute impulse purchases.

“Prime Day has become of one the biggest e-commerce moments of the year, as consumers latch onto major discounts from a number of different retailers,” said Vivek Pandya, a lead analyst at Adobe Digital Insights, in a statement. “The record spending so far shows us that consumers are tapping into their inner bargain hunters, stocking up on specific categories such as electronics and apparel while the discounts remain steep.”

Across major marketing channels, affiliates/partners saw the biggest lift when it came to revenue contribution (up 11 percent). Other major contributors were email (up 10 percent), display (up 5 percent) and social (up 4 percent).

How to Prepare

Here are some tactics advertisers should take to prepare themselves for Amazon Prime Day – and start preparing now:

  • Offer exclusive discounts and bundles. Prime Day is all about deals. So make sure you’re offering discounts that will make your products stand out from the competition. You could also offer bundles of products to give customers more value for their money. Participate in Amazon’s Lightning Deals and coupon promotions to drive increased sales and conversions. These limited-time offers can create a sense of urgency and encourage impulse purchases.
  • Re-examine your search campaigns on Amazon. Given how much Prime Day shoppers seek out deals, are your keywords aligned with what value-based shoppers are looking for?
  • Optimize your product listings. Make sure your product listings are optimized for search so that people can easily find your products. This includes using relevant keywords, clear and concise product descriptions, and high-quality images. Consider using Enhanced Brand Content or A+ Content to provide enhanced visuals and detailed product information.
  • Stock up on inventory. Make sure you have enough inventory to meet demand. You don’t want to lose out on sales (and annoy Amazon) because you’re out of stock.
  • Promote your deals on social media and email. Let your existing customers know about your Prime Day deals by promoting them on social media and email. You could also create a dedicated landing page for your Prime Day deals.
  • Track your results. It’s important to track your results so that you can see what’s working and what’s not. This will help you improve your strategy for future Prime Day events.
  • Do post-Prime Day follow-up. After Prime Day ends, leverage post-event insights and customer data to retarget potential customers and nurture ongoing relationships. Develop post-Prime Day campaigns, including remarketing efforts and personalized offers, to maintain momentum and drive additional sales.

Contact True Interactive

To succeed in Amazon’s world, contact True Interactive. Our experience with Amazon Ads makes us well suited to help your brand succeed all year-round.

Three Takeaways from Amazon Prime Day 2022

Three Takeaways from Amazon Prime Day 2022

by Morgan Reilly Amazon

Amazon has announced that Amazon Prime Day 2022 was the biggest Prime Day Event ever. Prime members purchased more than 300 million items worldwide during Prime Day 2022, which took place July 12-13. Amazon did not disclose sales results, but the 300 million items purchased was up from 250 million in 2021, and research firm Numerator estimates that spend per household neared $200, up from the high $150’s in years past. This is an impressive measure especially amid soaring inflation. So, who is buying all this stuff, what are they buying, and how are they buying? This is a significant question. The answers give advertisers clues about online purchasing behavior during inflationary times. Well, Numerator took a close look at the numbers. And they say a lot.

Women Drive eCommerce

High income, suburban women were top Prime Day 2022 shoppers. Compared to Prime Day 2021, this year’s shoppers were marginally older, and slightly more likely to come from middle or low income rural households.

Women dominate Prime Day

These figures validate why brands market to women. Women are responsible for most purchases in a typical household, and since there are 3.9 billion women in the world, marketers are eager to gain as much of their spend as possible. But marketers need to be mindful to tailor their advertising to women – for example by respecting their diversity and steering clear of tired themes (such as always depicting moms as caretakers and nurturers).

Amazon Wins by Tapping into Its Customer Base

95 percent of households knew it was Prime Day before shopping, and most learned about the event directly from Amazon. Among those who were aware of the sale, 41 percent say it was the primary reason they shopped on Amazon and another 42 percent said it was a contributing factor. And Amazon dominated the list of most popular products sold.

Amazon dominates Prime Day

These numbers underscore the power of Amazon to capitalize on its built-in customer base by promoting big ticket events to them. Amazon has successfully developed hundreds of in-house products and brands, and the company knows how to market them to Prime members.

This will pressure businesses to get out in front of big-tent sales such as Back-to-School, Black Friday, and Cyber Monday even more so than they have, especially by re-marketing and advertising to their own customers. This is especially true during inflationary times. One third of Prime Day shoppers waited to buy something until Prime Day, with another 17 percent using the event as an opportunity to stock up on sale items. On the flip side, over a fourth of Prime Day shoppers passed up a good deal on a non-necessity. Businesses will double down on special sale days in 2022, knowing that their customers may very hold out for promotional specials to maximize savings.

It’s also worth noting that Amazon didn’t dominate every product sold, with products such as Dawn Dish Soap, Frito-Lay, and Tide doing well. Businesses have learned that it’s better to join Amazon than to try and beat the retailing giant. And retailers who tried to compete with Amazon by creating their own quasi-Prime Day events did not succeed: although 54 percent of Amazon Prime customers considered buying from other retailers during Prime Day (particularly Walmart and Target) only 24 percent actually made purchases elsewhere in addition to Amazon, with about one-in-ten still considering a non-Amazon purchase at the time they were surveyed.

This is why Amazon Ads is succeeding: the company has monetized all the data it collects about its customers and developed attractive ad units for companies that want to reach them. The advertising arm of Amazon achieved 32 percent year-over-year growth in 2021, which amounted to $31.2 billion in revenue. Amazon Ads will continue to be a huge growth engine for Amazon, as more businesses try to reach the customers searching for things to buy on Amazon every day. (Amazon is now bigger than Google for product searches.)

Live Stream Shopping Is on the Rise

Amazon noted that Amazon Live Prime Day streams had more than 100 million views. Thousands of users hosted livestreams during this year’s event, Amazon said. Livestreaming makes it possible for advertisers to sell products via live demonstrations and promotions. Live shopping is especially big in China: according to eMarketer, live shopping accounted for nearly 12 percent of China’s retail ecommerce sales in 2021. Coresight Research estimates the live-stream shopping market will reach $20 billion in 2022 and grow to roughly $65 billion by 2023. Several livestream platforms have proliferated. But livestream shopping needs to be done well, with great production values and authentic, engaging personalities to connect with shoppers. This is why businesses are turning to ready-made platforms such as Amazon Live.

Contact True Interactive

To succeed in Amazon’s world, contact True Interactive. Our experience with Amazon Ads makes us well suited to help your brand succeed all year-round.

No More Shopping Stampedes: How Black Friday Is Changing

No More Shopping Stampedes: How Black Friday Is Changing

by Kurt Anagnostopoulos Retail

Black Friday is changing radically in 2020.

A Google-commissioned Ipsos survey found that 74 percent of U.S. shoppers said they plan to shop online more than they have done in previous seasons. And people who shop in stores will rely on services such as curbside pickup to limit their contact with other people. In response, retailers are taking a hard look at their Black Friday experience.

Retailers Reinvent Black Friday

Consider what some of the heavy hitters are doing to re-imagine what Black Friday means during a year when many people simply don’t want to go into stores.

As noted in RetailWire, “Walmart has long been one of the retailers noted for performing at a high level when facing down natural disasters and economic tumult.” The retail monolith’s response to Black Friday is no exception. As reported by CNBC.com, Walmart is taking an innovative approach, staggering three holiday sales events through the month of November. Each sales event will begin on the Walmart website. Brick-and-mortar stores will continue the sales a few days later, after some demand has presumably been satisfied online (thus mitigating crowds). On the holiday sales days, stores will open at 5:00 a.m. local time. Shoppers will encounter COVID-era precautions: single-file lines; limits on the number of shoppers inside at any given time; sanitized shopping carts; and store “health ambassadors,” who will greet shoppers and remind them to wear a mask. Bargain hunters who prefer to bypass in-store shopping can shop online, or take advantage of Walmart’s curbside pickup.

As Scott McCall, executive vice president and chief merchandising officer for Walmart U.S., shared in a news release, “By spreading deals out across multiple days and making our hottest deals available online, we expect the Black Friday experience in our stores will be safer and more manageable for both our customers and our associates.”

Walmart’s not the only one to re-think what Black Friday looks like this year. Many other retailers have announced that they are redefining the traditional in-store Black Friday sales as a digital experience that occurs over days, weeks, or even months. Home Depot set the tone early, announcing in September that Black Friday prices would be available throughout the entire holiday season, both online and in-store. Though a few “unique deals” are planned to launch later in the season, the store is orchestrating a campaign that consciously sidesteps that single day of crowded, feverish shopping.

Retailers are also capitalizing on opportunities like Amazon Prime Day to generate a surge in sales that businesses often associate with Black Friday. This year’s event ran for two days, October 13 and 14, during which marketplace sellers netted $3.5 billion+. Third-party merchants on Amazon generally reported good results. As noted in practicalecommerce.com, along with the increased sales came increased advertising costs. At the same time, the results speak for themselves: for one of our clients, we secured 44 percent more revenue and a 33 percent increase in return on ad spend on Prime Day — with only an 8 percent increase in advertising costs. We were happy with the outcome, as our client was.

Shipping during the 2020 Holiday Season

As retailers respond to a changing retail landscape, they must also face the reality that with a surge in online ordering throughout November comes the potential for shipping delays as businesses send more packages. More packages being delivered puts more of a strain on shipping services – and possibly a strain on retailers’ fulfillment capability. On the other hand, FedEx has said it is hiring 70,000 seasonal workers to manage an expected surge, and bellwether retailers such as Target are hiring aggressively to ensure they can handle the increased volume in online orders.

What Should You Do?

How do you plan to stay competitive during an unprecedented year? We recommend:

  • Don’t wait for Black Friday to promote your holiday deals. Activate your display advertising, search marketing, and paid social media programs now.
  • Consider creating events of your own. Don’t worry about creating a blowout on the scale of Amazon’s Prime Day. Instead, take a page from Walmart’s book and ask yourself how you might create your own “Black Friday” digital events. Learn from the bellwether brands!
  • It goes without saying, on the operational side, prepare yourself for the expected uptick in orders. Assuming you have done so, promote any deals you’re offering on shipping (something we’ve blogged about here). In addition, set expectations with your customers. Let them know that waiting until the last minute to order and ship may incur additional delays this holiday season in particular.
  • Be mindful of tone in everything you do. People want to shop, yes—but as we’ve blogged here, they are also under stress. Many shoppers will be ordering gifts for loved ones from whom they will be socially distanced this holiday—and feeling a sense of loss as they do so. Others may be overwhelmed by COVID-19 news: fearful of a spike in the virus, or a lockdown of stores and businesses. Be sensitive to these anxieties in your messaging.

Contact True Interactive

In a year like 2020, even traditions like Black Friday are going to look different. We can help you maximize digital and rise to the occasion. Contact us.

Photo by Justin Lim on Unsplash