Breaking Down Prime Day 2020

Amazon Prime Day 2020 was anything but predictable. Given the year that we’ve had, this is perhaps not surprising, but it is indicative of the holiday season that is upon us and what might happen to key shopping moments in 2021.

Margaux Logan, VP of Online Marketplaces at Publicis Commerce, recently sat down to discuss this year’s two-day event with key commerce leads from the Publicis Media agencies, including Caroline Ballard, Director of Performance Media - Search, Starcom; Adam Kessler, Group Media Director, Zenith; Mike Sinclair, VP, Performance Media – Search/SEO, Spark Foundry; and Lauren Stone, VP, Group Media Director, Performics.

Prime Day Halo Effect

While the group saw much less competition for their clients than in years past, there were new opportunities that surfaced and brands were looking for ways to leverage the halo effect on other retailers, continue momentum of sales going into the weekend and generally round out a holistic marketing strategy.

The majority of deals happened on Day 1, with 5,850 active deals in the U.S. throughout the day, according to findings from Publicis Commerce’s proprietary Commerce Intelligence assessment. Of those deals, the vast majority were focused on home improvement, electronics and home. Most marketers opted for the biggest impact on Day 1 to take advantage early and leverage traffic from the following day.

Petcare was one sector that benefited from a late Prime Day, as it extended sales beyond their peak season of summer. Entertainment was a category that saw sales spike outside of Prime Day throughout the following weekend and across other retailers, showing that Prime Day is also driving demand for related items.

Keep It Simple and Agile

This year, brands who approached Prime Day were looking at the event as a foundational litmus test for how this year’s holiday season will shape up. That said, this year’s event had more weight in helping marketers think through audiences, consumer demand and analyzing various data to understand what is driving purchase today and into the Q4 holiday season. Key to brand success will be the ability to keep things simple and agile. Things could shift quickly in this environment, so it’s important to have a flexible approach to pivot up or down depending on what happens. Search, in particular, follows demand so focusing on consumer behavior shifts will be crucial.

Third Party Focus Takes Center Stage

Traffic overall was flat compared with years prior, but this year we saw a strong focus on third party retailers and a concerted effort to drive sales to smaller business and third party providers – something that could potentially alleviate fulfillment challenges for Amazon this year, given increased pressure on supply chain and distribution this year.

This overarching shift also demonstrates the evolving shopper landscape. This is the first year there has not been exponential growth on Prime Day. We’re seeing more retailers get in the game, so Amazon’s approach to provide credit for supporting third party or smaller businesses is one way to ensure they have the supply and reach that other retailers might not.

Retailer Repercussions

This year, we saw 51% of top 100 non-Amazon retailers offer sales and online sales up 76% for these sites. And while Amazon traffic was flat this year, there was a 51% increase in traffic for non-Amazon sites.

This data illustrates the importance of a holistic approach and realizing that sales can and do happen outside of Amazon on Prime Day. Despite the rise in online traffic overall, some retailers also have added benefit of more shopping options when compared to Amazon – such as Walmart and Target’s BOPIS solutions. When looking across retailers, make sure you have similar strategies across these retailers but that they’re tailored across each retailer for specific nuances. For example, Walmart has announced key future sales dates, so it’s important to understand each retailers times to own and when you need to be there.

Prime Day Tactics Influencing Q4 Strategy

These agencies and their clients used a number of tactics to stay ahead on Prime Day. One thing many teams did was work more collaboratively across client teams, keeping everyone informed of the constantly evolving landscape. They also worked together to find ways to work smarter and monitor out of stock items early in the day – knowing it’s not possible to plan for the unplanned and that they’ll need more time in the day to adjust. Another interesting tactic used was maintaining focus on bid strategy. When competition is not as high as in years past, there is an opportunity to lower bids and remain competitive given the current environment, so this led to opportunities to reallocate budgets accordingly.

Keys to Success

As we begin the 2020 holiday season and potential inventory and shipping constraints, some tips for success include:

Leveraging third party API actions to monitor out of stock alerts. Automating parts of the process and gathering intelligence will help you focus on what’s next so you can amplify or fix things.

Working with clients for upward planning. This will allow you to ensure they have proper stock levels. Figure out if a client has an authorized third party seller to flex between the two. Be agile and don’t’ miss out on sales.

Look at alternate fulfillment models. Understand where out of stock is happening and work with clients to determine if it’s part of the supply chain, specific to a regional issue or something else. This will allow you to quickly pivot your strategy and stay agile.

Stay close to various teams at the client level. Take a forward-looking approach to see how much product is on hand, how it ladders back to the media strategy and keep an open dialogue with clients throughout the process.

This may very well be the first pandemic Prime Day, but the result will have long-term implications for shopping occasions throughout the rest of this year and beyond. Make sure you’re gearing your organization up for success today.