Paid Search

How Brands Are Utilising This Year's Amazon Prime Day

This year marks the fourth Amazon Prime Day and since its inception, the online retailer has harnessed all the potential of a key sales day outside of Q4. As a result, this has significantly altered the behaviour as well as the types of items that people are purchasing each July. Through creating this demand, brands can justify additional budget and comprehensive media plans to ensure that discounts are visible, that these deals are beating the competition and that all of this activity leads to Amazon’s continued growth in its ad business.

So, are brands increasing spend for Prime Day?

Brands continue to see the value in taking part, even though it’s become quite a crowded space. However, due to the level playing field of Amazon’s Marketing Platforms, competitors can easily inflate an auction which leads to an increase in cost to maintain similar levels of visibility. This means that brands have to weigh up the benefits of profitability vs visibility. Prime Day is focused around greater discounts so this can be a good opportunity for brands to penetrate the market.

Amazon is maximising Prime Day with brands and agencies

Amazon is working closely with brands to plan how Prime Day promotions will be promoted via Amazon’s ad space. In terms of growth, there are quite a few insights to highlight. In 2017, Amazon saw a 60% YoY increase in growth, exceeding the amount of sales by 9pm vs the previous year. That same year, Prime Day was Amazon’s biggest sales day in the UK with impressions on the day increasing by around 130% YoY. These insights, shared by Amazon, highlight the great opportunity for brands and the importance of agency collaboration.

Tips to Navigating Amazon's Marketing Platforms 

From a paid search perspective, brands have larger budgets to ensure that they are prepared for the increase in volume and competition. It’s therefore important that brands ensure campaigns are set up at least two weeks prior to help maximise visibility. Also, understanding the best ad types to use is crucial. Amazon recommends using a combination of Headline Search, Product Display and Sponsored Products to maximise ad space visibility. However, also aligning this to your KPIs will highlight where more budget should be allocated. Lastly, keyword selection is extremely important as it allows a brand to align selected match types based on budget and KPIs. The exact match type tends to have cheaper CPCs and allow greater control to maximise ROAS (return on ad spend) whereas Phrase and Broad Match can be used to drive greater visibility.

Conclusion

Advertisers have to rely greatly on Amazon during Prime Day but also try to reduce that need by being agnostic with promotions. This ultimately allows other retailers and direct sites to house the same discounts. Due to the broad reach of Amazon and the marketing carried out to promote Prime Day, it is drawing in not only its own customers but also making general shoppers aware of the discounts over the time period.  

Key Takeaways for Advertisers

1. Prime Day is now a key sales day with large volumes that are worth capturing

2. Amazon Marketing Platforms do provide value but consider whether it is worth sacrificing ROI
3. Align KPIs prior and drive efficiencies through the better performing ad types

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