If you’re an Amazon seller, we’ve got good news. Amazon Prime Day will be here before you know it.
Last year, US online spending exceeded $11 billion across all sales channels during the two-day sales event, up more than 6% from just over $10 billion during Amazon Prime Day 2020, according to the Adobe Digital Economy Index.
While it may not be the 50% year-on-year growth witnessed prior to 2020, Amazon Prime Day’s impact in uplifting sales across sales channels makes it a shopping holiday worthy of its position among the greats like Black Friday and Cyber Monday. 👑
But it’s also true that times have changed since Prime Day’s inception and there may be an impact on the traffic, sales, and growth opportunities sellers see this year.
In this article, we’ll explore the latest trends and predictions for Amazon Prime Day 2022 and whether it’s worth investing your time and money this year.
The scoop on Amazon Prime Day 2022
- The latest on Amazon Prime Day
- Is Prime Day still a goldmine for sellers?
- The top 4 must-know predictions for Prime Day 2022
Make sure you have the inventory and ad budget you need this Prime Day. Find out how flexible working capital can help make it a home run.
The latest on Amazon Prime Day
If you’re here, you already know the score on Amazon Prime Day.
Once a year, Amazon hosts a huge 48-hour flash sale for its Prime subscription holders. Usually, the event takes place mid-year (except that one time in 2020 when they pulled a last-minute switch up and moved the event from July to October 🤷🏽♀️).
According to current speculation, Amazon Prime Day 2022 is tipped to take place from July 18 to 19.
During the two-day event, thousands of Amazon sellers flood the marketplace with deals and discounts to drive shoppers to their stores. And it works.
All across the world online shoppers head to Amazon for Prime Day’s limited-time deals. In 2021, Asian Pacific countries and Italy were among the biggest champions, growing in online sales by 41% and 47% respectively during Prime Day, according to Saleforce’s Q2 2021 Sales Index.
Is Prime Day still a goldmine for sellers?
Every year, online brands and ecommerce sellers anxiously await Amazon’s Prime Day announcement.
But with pandemic related disruptions and consumer buying shifts changing the game, there’s some well-warranted chatter around Prime Day’s real return on investment for online sellers.
The burning question now is: “Is there still honey in the Amazon Prime Day pot?”
The unfortunate answer is… it depends.
Here’s what the latest data has to say:
- Cost per click advertising costs have jumped: As a competitive period on the ecommerce calendar, ad cost spikes are to be expected on Prime Day. But ecommerce brand owners were stunned by just how much costs increased, with little to show for it. According to original research from pricing intelligence platform Feedvisor, cost per click (CPC) spiked by 28.6% across categories in 2021 compared to 2020, while Return on Ad Spend (RoAS) decreased by 18.3% in the same period.
- Competing events steal the limelight: While total ecommerce sales hit $11 billion during the Prime Day 2021 time period, the result for Amazon itself proved lackluster compared to previous years. For example, Prime Day 2020’s result of $10.4 billion in sales was nearly double the $5.8 billion pulled in during Prime Day 2019. In the early years for Prime Day, Amazon may have had the lion’s share of the sales but recent results show a more diversified spread among other marketplaces like Walmart, eBay, and Best Buy who have created their own versions of Prime Day.
- The big brands are the largest overall winners: In 2021, the biggest winners were larger brands who had the financial capacity and order volumes to offset supply chain challenges and offer the kind of ultra-competitive deals growing brands struggled to compete with. Many smaller and midsize brands chose not to participate rather than try to compete as a “low-cost leader”.
With all of this in mind, it’s no wonder some sellers have decided to forgo Prime Day altogether, while others are opting to compete through other strategies that take advantage of the Prime Day “halo effect”, such as hosting their own promotions and special offers.
Your success with Amazon Prime Day depends on your brand’s ability to adapt and respond to the current market.
If you can keep best-sellers in stock, serve well-trafficked categories on Prime Day, invest in inventory and marketing early, and summon the creative willpower to stand out among the larger players — Prime Day could still bring you a massive pay day.
The top 4 must-know predictions for Prime Day 2022
To get your store prepped and ready to crush it on Prime Day, it’s helpful to zoom in on the top predictions and data insights.
Let’s take a closer look at some of the key trends that could impact your Prime Day results this year.
1. Tech products will take the spotlight
The Prime Day play: Leverage your own best-selling categories.
Each year technology devices claim the top spot for deals and shopper interest, especially Amazon-related devices. And this trend shows no signs of slowing in 2022.
Of course, that isn’t to say you can’t profit in other categories. If 2021’s Amazon US Prime Day results are anything to go by, baby products, health and beauty, household goods, and apparel could all be very profitable niches this year.
But regardless of your category, one of the best ways to win on Prime Day is to make sure you’re stocked and ready to sell your top movers.
- Review past sales data to forecast the right amount of inventory and aim to replenish early.
- Consider ordering additional buffer stock just in case.
- If you’ve had success with product bundles in the past, plan ahead to run special promos to increase your Average Order Value (AOV).
2. The halo effect will continue
The Prime Day play: Tap into your target customers’ shopping habits.
The infamous “halo effect”, referring to the excitement, extra footfall, and attention generated by Prime Day, has remained constant since its inception.
The difference we’re seeing now is that the halo effect is now spreading over to other large marketplaces such as Walmart and Target.
In 2022, you may see more brands capitalizing on the Prime Day halo effect by magnifying their advertising and promotions, and setting up shop on multiple platforms in time for the big sale.
- Look for ways to accommodate shopper buying habits into your product offering. For example, if your analytics show many customers buy in bulk, you could offer a custom bundle at a discounted rate to secure more sales.
- Alternatively, you may realize some products do well on the subscription. You could give shoppers the opportunities to get items for less if they sign up during Prime Day.
- Despite the increased share of sales to larger marketplaces, 34% of shoppers say they prefer purchasing from small businesses during events like Prime Day. Now could be a great time to show off the fact that you’re a growing business.
3. Shipping challenges could lead to pricing and stock issues
The Prime Day play: Get stocked up and ready to ship early.
While the manufacturing industry is regaining stability, the global shipping supply chain remains rocky. For the foreseeable future, getting goods into your warehouse will likely continue to be both time-consuming and expensive.
Supply chain issues will almost certainly affect the discounts, promotions, and units you can offer on Prime Day. And of course, there’s also the risk of increased stockouts on Amazon and other sales channels.
Since these problems aren’t going away anytime soon, it’s best to face them head-on. Create a comprehensive plan to avoid shipping delays and boost stock in optimal places.
- Start looking for vessel space early to secure better rates.
- Build a few weeks buffer time into your shipping plan to accommodate port delays.
- Establish product reserves in key locations.
- Focus on filling up top-performing products to avoid stockouts while preserving cash.
4. Amazon Ad prices will continue to rise
The Prime Day play: Invest in email instead.
We hate to be the bearer of bad news, but just like Black Friday and Cyber Monday, Prime Day ad costs are likely to remain sky-high.
According to the previously cited Feedvisor report, ad spend ramped up by 93.6% in 2021 compared to 2020. Of course, if you have the skills and can afford to be laser-focused in your campaign selection, you can still get ROI out of your ad budget.
But for many sellers, email marketing offers a much safer route. According to Adobe’s Digital Economy Index for Prime Day 2021, the share of sales with email as the last touch increased by over 11% last year — the highest rate out of organic search, direct traffic, social media, and affiliate traffic.
Here are some quick tips to help sharpen your email marketing.
- Work to increase your subscriber list in the run-up to Prime Day.
- Build buzz with teasers, giveaways and exclusive product launches leading up to the event.
- Research winning offers from previous years and put your own spin on them.
- Segment your subscribers based on your core target personas for higher conversions on personalized offers.
This year, make the ultimate Prime Day play
This Prime Day, don’t let tight cash flow or Amazon’s rigid payout schedule keep you from growing your brand.
Whether it’s a boost in ad budget or an investment in buffer stock ahead of the big event, the SellersFunding Daily Advance can help you access up to 90% of your incoming sales so you can keep your growth on track.
For brands with longer-term needs, you may be eligible for up to $5 million of working capital to help stock up on inventory ahead of peak shopping days, fortify your ad budget during high shopping seasons, and invest in profitable new product lines or sales channels.
Because for sellers who play their cards right, Amazon Prime Day can still deliver a massive uptick in sales. And at SellersFunding, we want to see you win.
So start your preparations early, optimize your campaigns, and look for ways to make your product offer stand out above the rest. And if you need a hand with flexible funding, don’t hesitate to reach out.
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