Amazon Prime Day has risen in prominence in the retail calendar since it was introduced as the bargain shopper’s ‘happy hour’ six years ago. This year, it will be held on 21 and 22 June, much earlier than anticipated. It is typically held in July.
Last year, it was pushed back to October (13 and 14) because of the pandemic - and despite being in the thick of a health and economic crisis, there were estimates that global sales reached a record $10.4 billion for the two days - 45.2% higher than in 2019.
It is thought that pent-up savings gave Amazon Prime Day 2020 a huge lift.
Recent research from Barclays and Oxford Economics estimates that Americans had accumulated almost $2 trillion in excess savings in the 11 months since the COVID-19 outbreak.
This year, Amazon has less of a captive audience. Much of the US is less constrained by social restrictions. Yet, ecommerce is still booming and a combination of financial stimulus, cheap borrowing rates and a savings glut - particularly in the higher-income bracket - is prompting analysts to predict that Prime Day will once again break sales records.
The pandemic and lockdowns fuelled an epic adoption of ecommerce and a year later, new habits are set. Online shopping will only grow. That heightens the significance of deal extravaganzas pioneered by Amazon, raising the revenue opportunity for the consumer brands that sell through the platform.
We will be tracking Prime Day in real-time on 21 and 22 June and reporting on key findings. Until then, see below for themes to look out for this year as well as some priorities for consumer brands should focus on to best leverage Amazon Prime Day 2021.
3 themes to look out for on Amazon Prime Day 2021
1. Amazon pushing small businesses
Third-party sellers, which are almost all small and medium-sized businesses (SMEs), were very successful last year. Amazon reported record-breaking sales of $3.5 billion globally. SMEs got a shout out during Prime Day 2020, with shoppers offered $10 to spend if they spent $10 with a small business the week before.
Amazon has revived this deal for 2021. Last year, Amazon spent $18 billion supporting SME’s. It said it had launched more than 135 new tools and services in 2020 to help sellers manage and grow their businesses. With third-party sellers accounting for more than half of all units sold on Amazon’s marketplace, expect
Amazon to continue to try and build loyalty with the entrepreneurs and SMEs that partner with it and use Prime Day as an opportunity to show support and grow its reputation as small business-friendly. It could push its Amazon Handmade and Amazon Launchpad platforms too.
2. Deals galore but Home Improvement may suffer
Cosmetics, fragrance and clothes: With people stuck at home due to Covid-19, sales of cosmetics and fragrances plummeted during the Covid-19 lockdowns. Now with the end of restrictions in sight, sales are starting to rise. Amazon and manufacturers in the category are likely to take advantage of pent-up demand. Amazon may also see this as an opportunity to encourage shoppers to use its Prime Wardrobe service.
AmazonFresh: The pandemic sent many shoppers online to order their groceries as opposed to visiting stores. Amazon was positioned to capitalise on this with their Amazon Prime Now and AmazonFresh services. However, last month Amazon announced that it was discontinuing its Prime Now app and website, consolidating it into existing services like AmazonFresh and its Whole Foods site. Amazon may see Prime Day as an opportunity to showcase its new streamlined service so that shoppers will not be surprised when Prime Now is retired. It could also use the shopping festival to add new grocery shoppers now that its offerings have become harmonised.
Home improvement and garden: One area where we may see fewer deals is in Home Improvement and Garden products. The pandemic prompted a global DIY boom but this has strained the availability of certain key materials now, like cement, timber and paint. At the same time, new Brexit-related rules have put pressure on the supply chain, which was exacerbated by a giant cargo ship getting stuck in the Suez Canal a few months ago.
Shoppers hoping to grab a bargain on a grill to enjoy the sunny weather may be disappointed.
3. A challenge from its rivals
Amazon’s rivals have always launched challenges to Prime Day with their own deals. This year, the battle seems to be bigger than ever. Target and Walmart have announced deal events for longer than Amazon’s two-day Prime Day extravaganza. Target's “Deal Days” will start on June 20 and end on June 22 while Walmart’s “Deals for Days” will run from June 20 and end on June 23. This is not the only area Walmart will try to challenge.
Just before Black Friday last year, Walmart launched its Walmart+ membership program which cost $90 a year. This provides shoppers with free shipping on all purchases, discounts on gas and more. It’s a clear rival to Amazon Prime so expect to see Walmart promote this membership prominently during its sales event.
Tune into Edge by Ascential’s blogs on the day to get our real-time analysis into who is winning Prime Day.
Succeed on Amazon Prime Day 2021: prioritise these 3 things
1. Invest in paid search
90% of purchases on Amazon begin with search. Given the high volume of traffic on Prime Day it is imperative your products are visible to shoppers. The top three listings account for 64% of all clicks and these listings are highly likely to be paid placements. Therefore your Prime Day strategy should include winning keyword auctions for the popular terms your shoppers are using.
2. Optimize Prime Day deals
Deals are the main focus for shoppers visiting the Amazon website on Prime Day. The deals page will be the first port of call for many. Manufacturers should consider Spotlight or Lightning Deals to maximise visibility The cost of these promotions is often easily recovered through increased sales. Choosing which deal to utilise will depend on the discount you’re willing to offer to shoppers. Spotlight deals have greater visibility but require a greater discount. Not engaging with deals can also have a negative effect after Prime Day with products decreasing in relevancy and organic search rank.
3. Ensure you have A+ content
Conversion rates are typically higher on Prime Day than a normal day however manufacturers must ensure there are no obstacles to purchase to take advantage of this. Manufacturers must ensure they have A+ content on their product listings, particularly the most popular products and those on deals. This includes comprehensive, high-quality imagery and videos, a broad and supportive FAQ section and clear and precise product descriptions. This content will make shoppers feel reassured about a purchase and ultimately boost conversion rates.
Watch out for our blogs on the 21 and 22 June for real-time analysis into which brands are winning Prime Day 2021.