Prime Day on Amazon - What can we learn from past events?
Prime Day is a big deal. Such a big deal in fact that Amazon added yet another event to the table this year, in the form of the Prime Early Access Sale. But what can we learn from Prime Days past? Should you jump on the bandwagon and participate? Or is Prime Day and the Prime Early Access Sale just another gimmick to get you to spend those precious ad dollars? Let's explore some data to see if participating in Prime Day is right for your brand.
Amazon Prime users expect a deal.
Amazon held its first Prime Day in 2015 and it was an immediate hit. Thousands of shoppers flocked to the site, creating a huge spike in sales and causing outages due to the high traffic load. The event has since become an annual tradition that draws millions of consumers each year. What's not so clear though is precisely what makes Prime Day so popular with customers, or why they're willing to spend more time on Amazon than any other day of the year (even Black Friday).
The answer may have something to do with how loyal these shoppers are — or rather, how loyal they think they are: About 43% of US households have at least one paid Prime Member according to Consumer Intelligence Research Partners (CIRP), which means there are plenty of people who see themselves as members first and foremost when browsing for deals online—and by extension might place greater value on products offered during this special promotion period because for them that title already carries some weight!
Prime day can improve your brand awareness
Prime Day is a good opportunity to get your brand out there. It’s a great platform for brands to build their brand awareness and reach new customers. And one (perhaps unexpected) benefit of offering a deal on Prime Day might actually be that you improve your brand awareness.
Although many shoppers may be tempted to buy on the Amazon.com website during Prime Day, they will likely research other e-commerce sites and products before making a purchase—especially if that product is available at a lower price elsewhere or has received better reviews from previous customers, in addition to shopping around external to Amazon, around 59% of customers will pricee-check similar products on Amazon itself.
It makes sense, then, to make sure your listings are as optimized as possible - you might end up with more eyes on them than you anticipated.
The usual suspects with the category race, but consumer goods make gains
Earlier this year, the big winners in Amazon’s Prime Day sale were consumer electronics, household essentials, and home improvement.
In the consumer electronics category the heavy hitters were:
- TVs (particularly smart TVs)
- Streaming devices such as Roku sticks or Apple TV boxes
- Laptops/tablets/notebooks (particularly Chromebooks)
This is a definite trend of Prime Days gone by, and there's no reason this is likely to change in the future. So sellers wanting to shift inventory of these kinds of products can seriously benefit from offering promotions to their customers - but beware that Sponsored Display Ads may be even more costly as the competition hots up.
That doesn't mean that sellers whose products have more of a repeat-purchase appeal should write off taking some sort of action on Prime Day completely though. It might be the case for some types of products that it's actually better to sit on your heels a little, particularly with products that your customers are likely to buy anyway - supplements & vitamins brands for example were the slowest growing category on Prime Day in July of this year. However, in the summer Prime Day, we saw a massive jump for pet brands - specifically an upward trend in the purchase of cat treats. Maybe it's a sign of the times that customers are taking an opportunity to save on their regular purchases? Some sellers might be able to take advantage of this shift by identifying their key gateway products and running promotions on those.
What we don't know, of course, is what the impact of these promotions might be over the longer term. Could implementing deals during Prime Day bring more new-to-brand customers to your storefront? Are these customers as valuable as your existing, loyal customers?
Using cohort analysis to understand the impact of Prime day
On that subject, then, you can use a cohort analysis to understand the impact of Prime day on your company.
- Cohort analysis allows you to see what people do over time, like how many purchases they make across multiple days, months, and even years
- By understanding your customers' buying habits and using data to inform your marketing strategy, you can improve and grow your brand as well as help the customer experience.
- You can even use Prime day just as a jumping-off point to experiment with your listings, using the potential jump in traffic to help you validate changes, then comparing your Prime Day cohort with previous cohorts.
We've written an in-depth article specifically on how to use a cohort analysis to understand if Prime Day is worth it for Amazon sellers
Understanding your audience is important for Prime day
When it comes to Prime Day, understanding your audience is critical. Knowing what they want and need is the first step on your journey to success. But you’re not done there. You need to understand their buying habits too.
If you know what types of products they’re likely to buy, that gives you a better chance of spotting a good deal as soon as it goes live (and then getting them excited about it).
The more information you have about your audience—their demographics, psychographics and behavioral patterns—the better placed you are to tailor content specifically for them during Prime Day sales events like this one!
Here's an example of how you can use this kind of data to your advantage. A poll conducted following the 2021 Prime Day - and similar data from earlier this year - concluded that men spent more (or planned to spend more) on Prime Day than women, with 63% of women saying they planned to spend about the same as usual. So, if your products cater more toward women and lend themselves well to being a repeatable purchase, then it's probably a good idea to ditch the deals - you'll probably make the sale anyway. You can find your demographic data in your Amazon Brand Analytics reports tab.
If you're still not sure if it's worth your time, don't worry. We've got some tips for you!
- Understand your customer's buying habits.
- See if there are opportunities to grow your business through Prime Day.
- Figure out how you can use the data that you collect from Prime Day to better understand and market to customers in the future.
The most important takeaway from these insights is to understand your customer. When Amazon Prime Day rolls around again in a few months (or even when Black Friday & Cyber Monday hit!), make sure you're armed with the data and insights of your customers to see if it’s worth joining in on the fun!
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