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GUEST COMMENT Personalisation, inflation and brand advice: key takeaways from Amazon Prime Day 2022

A worker in an Amazon warehouse. Image courtesy of Amazon
Jessica Chaplow is managing partner, head of commerce at Reprise Digital

Hosted exclusively for Prime members, Amazon Prime Day is gradually becoming one of the biggest key dates in the consumer calendar. Offering Amazon customers a small window for significant discounts over the course of a couple of days each year, shoppers flock to the marketplace to find the best deals available. Growing in popularity, Prime Day 2022 took place over July 12-13 this year, and saw Prime members purchase more than 300 million items worldwide – making this year’s event the biggest Prime Day in Amazon history. 

Topping the list in the UK, the Fire TV Stick with Alexa Voice Remote, HD streaming device took the prize for the most popular item purchased on Prime Day this year. Importantly, while Amazon benefits its customers through huge savings on Prime Day, more transactions also results in more donations through AmazonSmile. This year, during Prime Day, Amazon doubled donations on all eligible purchases in the UK, making this also one of the biggest days for UK charities on AmazonSmile.

Catering to consumers

Ahead of this year’s event, Emarsys undertook a study to explore how consumers would like brands to reach them and cut through the noise of surrounding competition. Unsurprisingly, the findings line up closely with the eventual results of Prime Day 2022.

Retailers continue to put more focus on personalising the customer experience. Amazon is no different in this regard, and this year the marketplace was offering exclusive deals to individual customers on Prime Day. Specifically in consumer packaged goods (CPG), deals were appearing to focus on social networking service (SNS) models, whereby customers were targeted through their personal information such as search habits or location. These exclusive deals were available and were offering customers up to 35% off.

In its study, Emarsys found that 21% of respondents want brands to prioritise promotions that they are personally interested in, while 15% want brands to only display products that they have previously bought. Amazon’s SNS approach catered to this demand, and as a result, in this year’s event, the new-to-brand purchase percentage decreased by 33% when compared to sales from Prime Day 2021.

Prime Users are definitely looking for good deals, but they may be arriving at the site with a clear list of the products that they want to buy, rather than in search of new brands to discover while browsing.

Inflation impacts

Despite this year’s event being the most successful one yet for Amazon, the cost of living crisis is something that must be taken into account for this year’s Prime Day.

Though 56% of Prime Day shoppers were from high-income households earning more than $80,000 (approximately £66,000) annually, according to Numerator, 83% were price-conscious as inflation has soared this year. Of those, 33% claimed that they waited for this sale to buy a specific item at a discount while a quarter resisted good deals because it wasn’t a necessity. 

Additionally, 22% of shoppers claimed that they price-checked items outside of Amazon before buying to make sure the deal was indeed a bargain.

With this in mind, it is tough to determine exactly how much of an impact inflation had on the event. Some clearly took the date as an opportunity to purchase their desired products – with some potentially holding off on buying items for months ahead of the event. Alternatively, the reluctance of some consumers to splash out on items as a result of the cost of living crisis will have definitely negatively impacted the overall revenue generated by this year’s Prime Day.

Implications for brands and retailers

So what does Prime Day 2022 tell us about what to expect on future Prime Days and in the holiday shopping season to come?

For brands, it will be important to have an explicit Amazon and Prime Day strategy. Brands should be prepared to advertise on Amazon and be featured as spotlight deals for greater visibility. Bands should also focus on popular products and offer steeper discounts on fewer items, perhaps focusing on one or two major deals, to attract press coverage and maximise consumer attention.

Retailers that compete with Amazon might look to consider partnering with other brands for exclusive deals in categories where Amazon hardware and private labels have a strong presence. In addition, retailers can take a page out of Amazon’s playbook and pursue an ecosystem strategy that rewards consumers who reach spending thresholds with membership deals. This could include free shipping for six months and other perks.

For brands like Amazon, the mix of online deals and data gathered in-store, through Amazon Fresh and Amazon Go, creates a powerful targeting combination.

Jessica Chaplow is managing partner, head of commerce at Reprise Digital

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