Selling on Amazon? Buckle up if you want to be ready for Prime Day 2021 on June 21-22.
To help sellers prep their strategy, Teikametrics’ Director of Insights Andrew Waber dives into data from previous years’ sale events. Using Prime Day sales metrics and recent Amazon changes, Andrew shares his insights for breaking into your market, outflanking your competition, and leveraging Prime Day activity into all-year benefits. In short: be prepared to play hardball to get the results you want.
- Dominating keywords in 2021
- The pros + cons of Prime Day product launches
- How to skyrocket your conversions
- Connect with Andrew on LinkedIn
- Check out Teikametrics
- Connect with Teikametrics on Twitter or LinkedIn
- Download our FREE Amazon Prime Day Report 2020
- Check out our Amazon Prime Day 2019 Recap
- Download our FREE Report on Amazon’s Big Style Sale
Watch the Replay
8:10 – The current state of the marketplace
Some of the biggest changes since 2019? More sellers and FBA restrictions than ever. Luckily, that trend came along with more inbound customers and advanced targeting options – so strategic sellers can still take the driver’s seat.
“More people are coming to Amazon, even outpacing the sellers. So there’s more room to grow. That being said, given industry, et cetera, that competition could have gotten significantly more tight for you. So there’s going to be a lot of variances here, but basically, everything is getting bigger. More competition, more activity makes that much harder, in some cases, to really stand out. I think everyone dealt with this probably to some degree at some point during the year. Amazon FBA restrictions are still obviously ongoing and kind of just dependability, right? Amazon FBA has changed so much, from the seller perspective in particular, when it comes to just how much you can rely on it – if that’s your first option or if you need to look for whether there are third-party providers that can do your shipping. There’s just so many, there’s so many more restrictions on it that you as a seller have had to adjust likely in some way. And you should also think about how that’s going to impact your Prime Day performance, because what your business looked like two years ago is probably very different than what it looks like now, even just from a fulfillment perspective. From an advertising perspective, product tags you’ll be targeting, and other kinds of very advanced targeting options on Amazon have broadened your ability to much more comprehensively target either competitor products or even your own products as a defense tactic.”
13:57 – A rising tide lifts all prices
With elevated sales in every category, Prime Day is a hot spot for more traffic, more competition, and higher cost-per-click.
“Amazon is really banking on getting people in the door. But what this data shows is that if people come in the door, for one thing, their surf time goes across everything. It’s not a single category or even just a couple of categories that see big increases. It’s pretty much every. And so you should absolutely expect it again this year. Again, the way this breaks down by category is likely to change just because of the time of year where people are in their lives now versus where they were in October. But this gives you a really good idea about this, this rising tide. We’re going to talk about this over the course of this. There’s this rising tide that lifts everybody when it comes to Prime Day. And by the same token, there is increased competition, right? More users are coming in, but CPC is going up because you have even more sellers that are advertising, that are pushing advertising budgets in. And that actually makes me CPC’s outpace the increase in traffic with some exceptions.”
16:06 – Doubling-down on your bidding budget
Don’t risk running out of budget as traffic skyrockets. Raise or uncap your budget when you have steady conversion volumes plus rates to keep competition in second place.
“CPCs are obviously important, it impacts how you’re thinking about bidding, right? You want to be more aggressive because you’re assuming that other people are going to be more aggressive during Prime Day. But remember what you really want to focus on – and we’ve said this many times, if you watch our other stuff, we talk about it often – which is the way you determine the worthwhile whether to raise your bid, whether to get more aggressive, it’s all about conversion volume and conversion rate. And conversion volume is obviously important because that is the meat of like, if I’m driving more conversions, I want to double down because I don’t want to be limited by a budget necessarily. Uncapped budgets are a very good idea. Because if I can get a sale, then if I’m bidding and it’s profitable, or the range that I’m comfortable with as a seller, I want to keep at it. I don’t want to let my competitors get in because I just run out of budget because there was so much activity, but now I’m out of budget. So you want to double down if you possibly can, whether it’s uncapped budgets, whether it’s even increasing your bid to get into more aggressive. If you see that conversion volume be very consistent, very good and that conversion rate remaining steady rate or even increasing, right? So your CPCs could be going up, but if you’re seeing those other rates rise, keep your foot on the gas.”
18:18 – Don’t force the discount
Discounts aren’t a must to benefit from Prime Day. Traffic is increased regardless, so you still have major sales opportunities at full-price.
“Do I need to do a discount on Prime Day? Is it absolutely imperative? And discounts definitely help. This is something we looked at in 2019: discounts help, but they aren’t a make-or-break deal. We know people arrived to Amazon on Prime Day looking for deals. But that doesn’t mean that they weren’t buying other things on there that are a normal price, everyday normal price on Amazon. And this interrelationship, we looked again, this was across that range of over a thousand products we looked at – and we looked at their average price prime day versus the prior four weeks, 40% of them actually increased the price versus the prior four weeks on a daily average. And then you saw again, between increase and no change, that was a majority. You have some folks that again, dropped their prices during Prime Day. But, keep in mind, this is not across the board. You do not have to drop your prices to have a great Prime Day. Not everyone is doing it.”
27:02 – Stay on top of your game
Prime Day is as good as your prep. Keep on top of your bids and budgets, and you’ll see the results in sales.
“There’s going to be a ton of traffic and be ready to adjust. This is obviously not a ‘set it and forget it’ type of event. You need to be looking and doubling down when necessary and potentially pulling back. But hopefully, you’ve done the work. Keywords and products that were good for you, that had been good for you over the past four or five weeks, they’re still going to be good for you now, but you have to be willing to adjust. Whether that’s budgetary, whether it’s bids. Just be prepared. This is not a holiday. You can’t always sit on your hands and think everything’s going to convert just cause there’s a lot of activity, a lot of things that you need to be on top of it.”
33:39 – Prime Day…to launch or wait?
Launching a new product on Prime Day gives you a conversion volume advantage along with the downside of tougher advertising strategies.
“The good thing about launching a product on Prime Day is you can get the volume necessary to really give you actually a leg up as you go into the rest of the year. Because the volume you’ll get will tell Amazon, ‘Oh wow. This product does convert for relevant keywords and we want to rank it higher organically.’ So in that sense, you can get much quicker than launching on another day – that kind of conversion volume that can actually help move you organically. However, on the other hand, every time you launch your product, you need to advertise. That’s just the nature of the beast on Amazon. And on Prime Day, that’s going to be even more expensive, like I just talked about that’s the nature of the beast. So if you have the budget to run with it and you feel like, ‘okay, we’ve got the amount of budget we can pay what it needs to take to get this to the top of a couple of relevant unbranded search terms that we know are popular, that we can convert users on,’ it is a great time to launch a product. You just need to have that budget because otherwise it may be kind of a moot point.”
38:23 – Advertising IRL
Thinking about going offsite to advertise your Prime Day deals? It’s only worthwhile if your discounts and margins are exceptional.
“How do you feel about advertising Prime Day promotions off of Amazon? I think this is a question that you need to think about it from a very much a margin perspective. I think there are a couple of things you should ask yourself. How is my discount competitive with other ones that you see amongst your similar competitors? Are you offering a better discount than they are? And if you are, maybe that is worth promoting off of Amazon. But just keep in mind, don’t go crazy with it because Amazon – they already, via the algorithm, prioritize products with a lower price with discounts. You already have increased traffic coming to the site, hopefully, increased conversion rates just in aggregate. But again, as we talked about, it varies. Really take into account, what’s your competitive set look like discount wise? Do you have the margin to kind of spend these additional dollars outside of Amazon to push people to Amazon? Is that worth it or would you rather spend that money just on the promotion or advertising on Amazon?”
42:33 – Keyword quality is greater than quantity
If you’re working in a saturated market, plan your keyword strategy for quality – not quantity. Choose the keywords within reach and laser-focus to win a select few.
“Specifically: if you think about a given product, what are the unbranded or category level keywords that when you look at brand analytics that are popular key terms for that type of product – and be laser-focused on those. Again, that small basket: three, four or five, eight terms, and you want to dominate those as best you can – as high as you can. Because that’s going to get you the most volume. And that’s how you break through a saturated market. Just being super laser-focused and be willing to spend what it takes, because that’s going to give you the volume that then will also have knock-on effects later in the year. Because that conversion you can get now is going to tell Amazon’s AI algorithm, ‘this product converts’ and then you’ll have those great effects even after the sale event. So a saturated market is really hard. You have to spend to get there, but right-size the effort. You can’t do 30, 40 keywords and expect, ‘oh, we can dominate. We’re going to win every single one of these on Prime Day.’ Because you have everyone else being super, super aggressive. What are the keywords that you feel it’s like, we can win this one?”
44:28 – Prime isn’t everything
Not a Prime seller? You can still win by strategically spending your way to the top of select keywords and highlighting your best offers and top-tier products.
“Prime is definitely a driver of people buying, even if the times themselves have gotten more lax where it’s not two-day delivery, it’s four or five-day delivery. It still has got that Prime badge and people still buy. It’s still a big driver there. I think if you’re not on Prime, I’d say, really be focused on, okay, what can you control in this case? Maybe what are your strongest offers? Where’s your best offer? And for those particular items I’d really be focused on, do you have the ability to – as we talked about earlier – what are the terms that you could target with that realistically, where you can essentially buy your way to the top? Because the prime badge means something, it doesn’t mean everything. And if you have a competitively priced product, if you’ve got what you feel is kind of the highest quality with a nice listing and everything. Try to, again, rightsize your efforts. I think you’re trying to boil the ocean, especially when you don’t have Prime availability for your grocery items, it’s going to be difficult. So really try and maybe just think about what are the products that you think you can do great with this Prime Day: competitively priced, great features vis-a-vis the competition.