In this recorded webinar, we dive into Amazon Prime Days 2021 advertising data, its sales impact, and advertising trends to help you gear up for the back-to-school season.
Summary
Take a walkthrough tour of Amazon Prime Days 2021 and focus on key insights in comparison with Prime Day 2020. This webinar analyzes the most striking observations, answering all your questions about the sale and understanding how to prepare your brand for the upcoming back-to-school season.
Key Takeaways
- Stats for sponsored products and brands: Through Prime days 1 and 2, both sponsored products and sponsored brands saw an increase in ROAS and a jump in CPC.
- Trends in category-wise sales: Home and kitchen products saw the largest growth, while call phones, accessories, toys, and games saw improved performances as well.
- Social media-induced traffic: Apps like TikTok, YouTube, and Instagram became key factors in driving more motivated consumers to the platform via paid advertisements.
- Boom in video content: Amazon products saw increased ads in video format, from listing benefits to featuring celebrities to attract consumers.
- Bagging the top of search placements: Across the board, competitiveness increased as the brands which promoted their deals, coupons, and offers got ahead in the race.
- Back to school season preparation: Use Prime days 2021 sale trends to prepare winning strategies for the upcoming sales and get ahead for the next year.
Transcript
Michael
Hi everyone, welcome to today’s webinar. Today we’re gonna be recapping Prime Day 2021 and providing you some interesting data points and insights from the couple of days of Prime Day from last week, we’re also gonna look ahead a little bit to some upcoming events. So today’s agenda, first, we’re gonna look at the Prime Day CPC report and take a look at some of those data points and insights, and then second, we’re gonna deep dive and double click into some of those data points a little bit more to come up with some key takeaways that you can use for future Prime Days, future promotions. We’re gonna talk a little bit about how you can plan for some upcoming events in Q3, such as back to school, and then finally, we’re gonna have a Q and A session. Throughout the webinar, feel free to drop in your questions, and we’re probably gonna hold on to those questions and then answer them at the end of the call, so yeah, just send them in throughout. Today’s speakers, you’ve got myself, I’m Michael Foulkes, and I’m a product expert here at Pacvue.
Jack
And I’m Jack Lindberg, and I’m also a product expert here at Pacvue. Okay, so what we’re gonna be talking about today is coming from a document we put together every Prime Day called our Prime Day CPC report, and the CPC report is sourced from Pacvue’s proprietary Amazon data set and includes an aggregation of hundreds of sellers and vendors of all sizes across all different categories, so we can get a really robust data set to provide you some insights today. So let’s get started. All right, so first thing we wanted to talk about today is we definitely saw a lot more ad spend for both sponsored products and sponsored brands during prime day, both day one and day two this year. So for sponsored products, we saw that 41% increase year over year and sponsored brands, 28% year over year. So really, really interesting to see. And overall, we saw a little bit higher of an increase on both for Prime Day Day One versus Prime Day day two. We look towards the CPCs with that increased spend, we saw some really interesting trends as well. When looking at Sponsored Products, we saw a pretty substantial increase in CPC year over year, about 22% across all categories, really interesting. In comparison to sponsored brands, where we saw those CPCs actually declined 1% year over year. I think this is in part due to a couple of new sponsored brand placements, especially utilizing those video assets that are a little bit under-utilized, and therefore the CPCs are gonna be a little bit less competitive. It’s worth calling out that for both sponsored products and sponsored brands, for day two, we actually saw a higher CPC than prime day day one, as people sort of realized Prime Day was happening or got around to adjusting your bids, we saw that that sort of market competition increased during the second half of the time day.
Michael
It is interesting that spend was lower on day two, but CPCs went up though, so it definitely indicates that some people were maybe running out of budget later in the day from their overall Prime Day budgets, I’m not sure, but definitely an interesting trend.
Jack
Totally, that’s a great call out, Michael. When we’re looking at ROAS for those same sorts of categories, we saw sort of an inverse trend to CPC, where sponsored products actually had a dip in ROAS year over year of about 10% whereas sponsored brands, as I mentioned, probably due to that increased inventory was up 27% year over year. What we saw, which was especially interesting, was that the ROAS for sponsored products really varied day over day, so on day one, we saw a 9% drop year over year, whereas on day two, we saw an even greater drop, down 12% year over year in terms of ROAS for sponsored products.
Michael
You’re always hoping that on Prime Day, like any kind of increase in competitiveness, higher CPC is gonna be offset by an improvement in conversion rate, and it’s pretty clear that with sponsored brands, at least that happened, but in sponsored products, it’s possible it with the higher competitiveness, it just resulted in a decrease in ROAS.
Jack
Yeah, definitely, when we get to some more of our takeaways, we can discuss a little bit more on how those more robust branding assets lead to some greater performance.
Michael
So looking a little bit deeper at some individual categories, cell phones and accessories was one of the highest in terms of increases in ad spend and CPC during prime day. ROAS did hit $5.52 across the category on day two, which is a 96% increase week over week, so this was definitely a category where we saw a lot of success, despite much higher ad spend and higher CPC, there is an improvement in overall efficiencies. Home and Kitchen was also an interesting one, here we saw that there was a 330% increase in average daily spend week over week, so definitely one of the highest increases in terms of categories that we double-clicked into. Additionally, we saw a spike in ROAS in this category, so this was another one where even though it was a huge influx of ad spend, brands actually saw an improvement in overall performance. And finally Toys and Games was another interesting one. Once again, we saw a large increase in ad spend, but CPC went up and they actually hit $2.07 across the category, which is a 229% increase week over week. This was a category where the huge spike and CPC actually resulted in a down tick on ROAS particularly on the first day of Prime Day. We actually saw a level out on Prime Day two.
So moving on to some of our insights and takeaways from Prime Day, we saw that brands that were running promotions and supporting their deals with advertising, saw the largest increases in CPCs with some noticing cost per click go up to 80% compared to last year’s, higher than last years’ event. One brand in particular in the fitness category saw approximately 76% higher CPCs this Prime Day compared to Prime Day in 2020, which is a huge increase year over year. Additionally, inventory may have affected which brands were advertising this year, given the supply chain issues that are affecting many categories as a result of container shortages at major manufacturing ports. Certain categories, particularly Home Goods categories, were less promotional than in typical deal events. Additionally, while the second day of Prime Day usually experiences a drop off in sales and likewise ad spend, early indicators point to sustained momentum throughout the event. So interestingly, it seems like consumers are really engaging with both days and Pride Day instead of just coming in on the first day and kind of interest waning by day two. And finally, there was a huge increase in use of TikTok, influencers, live video, lead in videos on YouTube and ads across social media networks, which indicates that there’s a whole new set of ways to engage with Prime Day outside of just sponsored advertising, and this is probably a trend that’s going to continue to increase.
Jack
Once those new customers came in through some of those non-traditional sources such as TikTok, they were met on Amazon with some pretty unique, I would say, more brand intensive advertising methodologies. So some of the cool ones that I wanted to call out today were sort of the proliferation across the board of video assets. So for example, Katy Perry put up some of her own videos to advertise for sandals, which really interesting to see sort of celebrities like that come out and you use their celebrity brand on those video assets. We also saw sort of the continued growth of Amazon Live, which for those of you who aren’t familiar, is basically like Amazon’s version of QVC, it’s really interesting to watch, and we saw that engaged a lot more consumers than we have historically seen in the past. One final call out that I think is really interesting is Amazon and brands are definitely looking to create this sort of experience in which Prime Day sets up like a continued purchase behavior, like building that sort of product or brand loyalty. So a really interesting example that the Pacvue team found was looking at Tide pods where we saw that Amazon bundled together Tide pods with their digital smart shelf, which basically says if this Tide pod container weighs less, you’re probably running out of Tide pods, and then we’ll automatically order Tide pods on your behalf, so helping to propagate that sort of subscribe and save model.
Michael
It’s really interesting, I definitely like putting myself into consumer’s mindset have been turned off from using Subscribe and Save primarily because I’m worried if the products were gonna come sooner than I need them, I just don’t have that much space. And so smart, maybe a little bit creepy, the idea of it, we can have a scale that will be bundled of your products to tell you specifically when you do need them, is a really smart idea, but it is interesting that they sort of paired it without necessarily having that direct collaboration with the brand.
Jack
From what we’ve seen is that this sort of bundle happened through Amazon, but not with the brand, so interesting to see that sort of top-down pressure for Subscribe and Save purchases. I’m definitely a Subscribe and Save user, I find it really helpful, especially for things I use frequently, like chapstick or whatnot, but I think it’s definitely going the way of the future as Amazon continues to push things like Amazon Fresh and whatnot, which we may see engage more with Prime Day activities as we go forward. Okay, so definitely in terms of other key takeaways for Prime Day, it certainly became much more competitive to appear in top of search placements without the bagging of a deal or a promotion, a coupon, so that’s definitely something to take into consideration for future events. If you’d like to be in those type of search placements, you really need to boost your competitiveness by having one of those deals run. We saw in general promotions running at really a wide range of extents across different categories. Really, I would suspect, as Michael previously mentioned, due to more supply chain constraints, so those categories specifically like home goods that have much stricter supply constraints didn’t use as much of those promotional deals across the catalog. It’s really interesting to see in general how other retailers are reacting to Prime Day and sort of creating this environment in which Prime Day is an overall consumerism holiday rather than a platform-specific holiday. Destinations like Walmart, Target, Best Buy and Chewy, actually all pre-launched deals before Prime Day to get ahead of the Prime Day traffic and hopefully siphon off some of the prime day buying intent to their platform.
Michael
I think if you’re an advertiser and you’re seeing, for example, that home and kitchen category where things went up like 300% in terms of CPC, this is a really key insight that there’s ways that you can spread your advertising beyond Amazon and capitalize on increased traffic, not just on Amazon, but on the over retailer dot com.
Jack
Totally, and I think this also poses interesting challenges in terms of pricing strategy, I think in general, brands can approach this a whole number of different ways, but I think what you probably want to do is create a price agnostic model in which no matter where someone encounters your product, it’s for the same price, so they know they’re getting the best deal and don’t feel obligated to shop around all the different platforms. That would definitely increase your conversion rates within an individual platform and lead to more effective advertising spend. So definitely, the final thing I wanted to throw back out there is that the search page is, the Amazon search results page is getting a little bit more crowded with all of these stickers and banners and ad placements, so definitely the amount of real estate that now lives above the fold is being reduced over time, which makes all of those premium placements just a little bit more competitive. What I would say as a potential methodology to counteract that is taking a look at some of those new sponsored brand video product page placements, which are really powerful ways to, say, conquest to your competitors by expanding your brand narrative, so maybe something to consider rather than competing with them directly on the limited real estate on the search and results page.
Michael
So looking ahead, now post Prime Day, it’s definitely time to start preparing Back-to School campaigns now, in-person learning is back this year, which means that we’re probably gonna revert back to a slightly more typical back to school with traditional shopping behaviors and traditional school supplies and clothes. I think that while more traditional compared to last year, I do think that it’s gonna be even more important to make sure that your present online, given the consumer search behavior has definitely changed somewhat permanently after the pandemic last year. Additionally testing out new ad type and targeting opportunities including sponsored brand video or placements on the PDP, like Jack mentioned, sponsored brands was where we saw the most success this year, so continuing to capitalize off of that moving forward and continue to test and learn is gonna be important as well. Using sponsored deals or Amazon DSP to re-target the lead-in and day of customers you engage with previously. I think something that Amazon always touts with Prime Day is the importance of those new-to-brand consumers that you capture on that day, so making sure that you re-target those consumers and keep them purchasing is gonna be really important.
And then finally, I think that it’s gonna be really important to debrief on share of voice changes, looking at both what happened leading into Prime Day, on Prime Day itself, and then comparing that to normal levels after Prime Day. I think that you’re gonna wanna compare your performance versus your prior peak events and stores metrics for your next peak period, ’cause they’re gonna be really important to determine how to approach Prime Day next year. Fortunately, Pacvue provides a lot of great insight there in the competitive analysis tab, so definitely take a look at that data and determine whether or not you think that you are investing at the right level so that you can plan appropriately for next year.
