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Key Takeaways from Prime Day 2021

Amazon’s Prime Day came early this year, in June rather than July, or even in October (as was the case in 2020), causing consumers and retailers to shuffle. The event ran for 48-hours, from June 21st-22nd. Regardless of when Prime Day occurs, it is certain to drive growth and bring new insights each year.

Key Takeaways from Our Clients

Performance Across Platforms Differed

Across brands, Sponsored Ads gained an average daily spend increase by 4.6x, with a 4.3x sales increase. Demand-side platform (DSP) spend increased only 1.7x with average daily spend, but sales were 3.8x higher. While Sponsored Ads brought greater volume, DSP drove higher efficiency.

Deals Reign King

As we’ve seen in previous years, deals over Prime Day drive results. Brands that were running deals saw a 5.2x sales lift as compared to the daily average. In contrast, brands without deals saw a lighter lift of just 1.3x average daily sales.

Limited Inventory Hurts Performance

Retailers across the globe continue to experience supply chain issues, which was highlighted in performance over Prime Day. Brands with major inventory concerns saw an average daily spend increase of 3.3x and a sales lift of 3x. On the other hand, our clients without this constraint saw a 3.2x increase in spend and 4.2x lift in sales compared to an average day.

Similar Shopper Experience to 2020

This year, Amazon Live was heavily featured again. While shoppers browsed through deals, products included in Amazon Live were highlighted at the top of the page featuring deals by category.

Shopper experience

Amazon continued its use of the Prime Day deals carousel. This placement typically appears directly below Sponsored Brands but above Sponsored Products and organic placements. The importance of promotions on Prime Day is further cemented for brands, as this feature is only accessible to brands that are running Prime Day deals on their products.

Prime day deals

Overview of the Ecommerce Landscape

Ecommerce at a Glance

While Amazon continues to run the show for Prime Day, other retailers are cashing in. Walmart, Target, Kohl’s, Best Buy, and other major retailers ran their own promotions that coincided with the event. eMarketer found that in the US, there was a 143% increase in online revenue on Prime Day compared to an average day in June. Whether on Amazon or other ecommerce sites, consumers were prepared to shop over Prime Day.

Slowed YoY Prime Day Growth for Amazon

Prime Day sales for Amazon continued to rise, though at a lower rate than last year. Based on eMarketer forecasts, total Prime Day sales are projected to have reached $11.79 billion in 2021. This is an increase of 19%, YoY. In contrast, projected Prime Day sales in 2020 represented a 43% growth over 2019.

Many factors may be contributing to this decline in growth. First, Prime Day 2020 took place in October and ushered in the holiday season. Due to the COVID-19 pandemic, there hadn’t been a Prime Day in over fifteen months, compared with just eight months between the events in 2020 and 2021. Furthermore, many people were staying home significantly more than usual, resulting in changing shopping patterns and exceptional growth in worldwide ecommerce sales. This year, Prime Day directly followed shopping for Mother’s Day and Father’s Day. The event took place at the end of Q2 instead of the beginning of Q3, which set it further away from another key event: the impending kick off of back-to-school shopping.

US vs non US sales

Source: eMarketer

Shifts in Consumer Demand

As vaccination rates increase and pandemic regulations subside across the United States, the business world must adapt to changing consumer behavior. This begs the question, what will that look like? Which practices and industries will continue to flourish in the post-pandemic economic environment?

McKinsey & Company found that the newly formed behavior in industries such as e-grocery, virtual healthcare, and home nesting will persist moving forward, as work-from-home will continue to be a prevalent for many people, even post-pandemic. This aligns with how consumers shopped on Prime Day, with the top sellers including the Instant Pot Pressure Cooker, Orgain Organic Protein Powder, and 23andMe Health + Ancestry Service.

Behaviors that will stick

Source: McKinsey & Company

Highlights from Amazon’s Press Release

Continued Focus on Small and Medium Sized Businesses

Amazon highlighted that Prime Day 2021 was “the biggest two-day period ever for Amazon’s third-party sellers,” noting that the majority are small and medium businesses. The company attributed this success to investing in small businesses with Amazon’s Spend $10, Get $10 promotion, which offered a $10 gift card when consumers purchased from participating small-business vendors. This promotion ran for the two weeks prior to Prime Day. Amazon reported that customers spent over $1.9 billion on small business products during this promotional period, which is a 100% increase compared to a similar promotion last Prime Day.

Prime Day Trends Identified by Amazon

  • Top-selling categories worldwide: electronics including Amazon Devices, tools, nutrition, apparel, household products, beauty, and baby care
  • Best-selling products worldwide: iRobot Roomba 692 Robot Vacuum, Keurig K-Slim Coffee Maker, Apple Cider Vinegar Gummy Vitamins by Goli Nutrition, and Crest 3D White Professional Effects Whitestrips
  • Despite the earlier timing of the event, shoppers still got a head start on some of their back-to-school shopping, “purchasing more than 600,000 backpacks, 1 million laptops, 1 million headphones, 240,000 notebooks, 40,000 calculators, and 220,000 Crayola products.”

Looking Ahead

Prime Day 2021 may be over, but there’s still strategic opportunity in the tailwinds of the event. Beyond allocating additional budget while traffic remains high in the two-to-three weeks following the event, advertisers can capitalize on increased awareness to move consumers through the marketing funnel as we begin Q3. The deals may have ended, but brands are still positioned for post-Prime Day growth.

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