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With Amazon announcing on Wednesday that its 2023 Prime Day sales event will run from July 11 to July 12, now is an especially good opportunity for sellers to ramp up promotions.
There are some new deals Amazon is testing this year, including exclusive deals on fast-selling products for Prime members, as well as Prime Day deals that will be available at third-party retailers powered by Amazon’s inventory and shipping infrastructure.
Each year, retailers have a variety of planning steps to take in the run-up to Prime Day, including reviewing the sales strategies they’ll use, from temporary, deep discounts known as Lightning Deals, to coupons and social media promo codes. Which options sellers choose can depend on many factors, including their product, budget, social media following, and time commitment. That means carefully strategizing to get the most bang for your buck and reap the highest rewards—more loyal customers and increased sales not just during Prime Day, but year-round.
“The goal of any deal is to get more products into more hands because you want people to become loyal customers. If you can’t do that, you’re just wasting money,” said Phil Masiello, chief executive of digital marketing. CrunchGrowth Company.
Here are ways small businesses can think about promotions to boost sales on Prime Day and beyond:
Selling price on Amazon can be turned into profit
Selling price on Amazon can be significant and varies depending on factors such as a merchant’s sales plan, product category, fulfillment strategy, and other variables. E-commerce entrepreneurs can use Amazon’s Seller Central online calculator to estimate the cost and profitability of selling a product on Amazon. Troy Evans, product manager at Skai, an omnichannel marketing platform, can take into account campaign costs to determine what to do next to break even.
Often it can be a judgment call. Evans said the promotion may not be the most profitable, but it’s worth doing because of the sales boost it generates. “It’s a trade-off.”
Gia Ching, managing director of GCC Consulting, a digital marketing and design firm, said sellers should be aware that consumers on Amazon are extremely price-conscious and factor that into their pricing decisions. “Even 50 cents can move the needle significantly. It can make or break your product.”
You can learn a lot from Lightning Deals
On Prime Day, Lightning Deals are exclusive to Prime Members, but this type of promotion may be offered more widely at other points in the year. While it may be too late to confirm a Lightning Deal in time for this year’s Prime Day event, sellers should think ahead to see if the strategy can be used effectively at another point.
“I’ve seen the same level of success for Lightning Deals at other times of the year,” said Nick Mattar, founder and CEO of digital marketing company Digital Detroit.
Lightning Deals are exciting because they’re only available for a short time. Customers can view current offers by clicking on the “Today’s Deals” or “Prime Day” link on Amazon’s home page. But there are also disadvantages. Sellers pay a nonrefundable fee per deal that can run between $150 and $500 per deal, depending on the time of year and day of the deal, Masiello said.
Being offered a deal is no guarantee of success, and Amazon takes its fees no matter what. Sellers must also meet Amazon’s inventory limits and have eligibility requirements. For example, a professional seller should have an overall rating of at least 3.5 stars. In addition, the product must have a sales history on Amazon stores and a rating of at least 3 stars. The product may also not be offensive, embarrassing or inappropriate. Additional criteria for product eligibility for deals are available from Amazon.
Before deciding to offer a Lightning Deal, sellers should try to understand how competitors’ products are performing with similar promotions. However, this is information that the business will likely have to pay to access. Subscription-based tools help sellers identify such data, and prices can range from $50 to $1,000 a month, depending on factors related to the data, sources, tool features and whether the audience is large or small sellers, said Masiello, whose firm offers. this type market research. Some tools strip out any data possible and provide estimates, while others integrate directly with Amazon and use accurate data.
And time is of the essence. Masiello said that for Prime Day, retailers should focus their Lightning Deals on products that people want year-round, rather than seasonal products. Top-selling categories in the past have included electronics, home appliances, premium brand skin care and personal care, technology products and fashion items.
Coupons can increase sales just as much as Lightning Deals
Sellers can also choose to offer coupons to customers for a certain dollar amount or percentage off. Customers can search or filter for coupon deals from Amazon’s homepage or view the deal in an individual product listing.
“Any coupon or promotion on Prime Day generally has a similar percentage increase in sales as a Lightning Deal,” Mattar said.
There is a cost to sellers—a 60-cent fee each time a customer redeems a coupon—that’s something to consider. And sellers need to plan ahead – although delivery times aren’t as long as with Lightning Deals. Evans suggests that sellers give Amazon at least a day or two to approve the coupon. “If you’re trying to get something for Prime Day, it’s too close for convenience to deliver it in the morning,” Evans said.
Use Amazon Seller Central for promo codes
In addition to offering a revenue calculator and details on qualifying products for deals, e-commerce businesses can generate discount codes through Seller Central, Amazon’s management portal for third-party sellers. They can then promote the code on social media and via email.
This avoids the coupon fee; However, consumers must take an extra step to redeem the code, Evans said. Additionally, to make a noticeable difference in sales, sellers “need a social media following and engagement,” Mattar said. They can also work with an influencer with a larger and more engaging following; you don’t have to be famous. “Influencers can be expensive, but if you can accurately predict what the sales increase will be, you can profit from working with them,” Mattar said.
Putting items on sale won’t make them stand out on Prime Day
A discount can be a reliable tool in a marketer’s tool belt, but simply launching a product won’t be enough to generate buzz on Prime Day, Ching said. That’s because—unlike Lightning Deals or coupons—Amazon doesn’t have a dedicated link for sale products. “It’s only going to capture people who are looking for your product or reviewing your product,” he said.
Also, your competitors will offer discounts on Prime Day, which can be a more profitable strategy for other times of the year, especially if you can consistently offer lower prices than your best competitors—assuming your margins allow it. , Evans said.
Promotions should be linked to a wider business strategy
The new invitation-only deals Amazon announced Wednesday appear to be a way to “claim” the best Prime Day deals ahead of time, Mattar said. Most of the invites he’s seen so far are on Amazon’s own products, such as a $99 43-inch UHD TV.
“The invitation feature makes sense for Amazon because it drives more traffic to their products in the run-up to Prime Day. If anything, it will make the weeks leading up to Prime Day as busy as the actual days,” he wrote in an email.
On the other hand, he said it could work well for consumers who want to avoid the rush when a Lightning Deal starts. “We know that Amazon’s own products will have the steepest discounts on Prime Day, so why not try to take advantage early? The bottom line is that not all invitations are accepted, so for this first year, Prime customers Prime They should still plan to check out the Amazon store when the day starts,” Mattar said.
Eventually, the concept is likely to roll out to Amazon sellers, and it will be a way to expand Lightning Deals, he said. “If someone sees your product and sees that they can ask for it at a discount, they do so and then get a chance to buy it at a discount. The downside is that it will be difficult to sell your products at normal price. .”
New Amazon deal concepts reinforce the bottom line for everything e-commerce entrepreneurs do on Prime Day. Nothing a retailer does for Prime Day or any other time of year should be done in a vacuum. “It should always be part of the larger marketing strategy you have. Running a campaign without a goal without planning for what’s next is a missed opportunity,” says Mattar.