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Folks! Mark your calendar for Amazon Prime Day Oct 13 – Oct 14.
 
After much anticipation and conjecturing due to Covid-19 related uncertainties, Amazon shifted the event from July to an October setting with events lined up in at least 19 countries, including the USA.

Oh, boy! The shoppers and marketers are lining up for a win-win outcome in an already super-charged Amazon universe.  Who would have thought that a pretentious shopping event to mark their 20^th anniversary started back in the summer of 2015 would grow into a well-crafted ecosystem that sells everything under the Sun? Backed by technology, worth-in-gold customer data, and insights, Amazon has managed to create a unique holiday event.  ‘Prime Day’ has indeed surpassed the frenzy of even Black Friday, Cyber Monday, or other holiday-themed shopping events.

For the first time, Amazon’s subscriber base has crossed 150 million subscribers during Jan 2020.
This strong subscriber base would have further increased due to Covid-19 related lockdown and higher e-commerce usage by socially distanced shoppers.  When put into perspective, Amazon subscribers have now crossed 50% of the US population.   

According to a CIRP report, Amazon’s Prime customer base spends $1400 on an average, compared to $600 for non-members. Not surprisingly, eMarketer estimates that Amazon’s 2020 Prime Day could generate nearly $10 billion in Sales. There is no shortage of promotions across various mediums to match an event of such magnitude. 
If 2019’s promotions for Prime Day are any indication, Amazon will continue to spend heavily on TV commercials and Internet ads to make the event a big success.

               

Source: Kantar                                             Promo email sent to subscribers (Source: Amazon)

In such a high stakes event like Prime Day, let us see how Brands can navigate this complex Amazon universe and win. To use an analogy from the cult 80s movie Back to the Future, brands will need 1.21 Gigawatts!

1.21 Gigawatts?!

Yes!  As 1.21 Gigawatts – was the exact amount of electricity needed to power the DeLorean and make time travel possible, brands will have to follow specific strategies and tactical moves to power their PRIME DAY success journey.

Let us look at the Top 10 ideas that can help brands score a PERFECT 10 on Prime Day.
[Do remember that the list is an indicative one. Every brand story is unique and needs concerted efforts to win the enigmatic A9 algorithm that runs Amazon]
 

1. CREATE HYPE- ADVERTISE!
To build on the existing foundation brands have created on Amazon, it is essential to reinforce it. Promotion is a potent tool for brand awareness when used effectively.

• Personalize your messages and build the tempo leading to the event.
• Identify products and assortments, which will lead your charge on Prime day. These Power brands have the potential to have a Halo Effect on other brands in your portfolio.
• Look at the bigger picture, not all promotions will directly lead to Sales during Prime Day, but the return on investment will come even beyond Prime days well into the Holiday season.
• Are you interested in Lightening deals for your brands? –  It is a very effective strategy to liquidate excess inventory or seasonal surpluses. 
• According to Jumpshot, 1 out of 10 product pages shoppers visit now comes from a sponsored content, a 3 percent jump since 2019.

Get out there and promote – on Amazon, on traditional and emerging mediums and generate Buzz.   The shoppers are listening, and the competitors are making their moves in real-time.


2. PERSONALIZE AND GAMIFY
In the digital world, personalization can significantly help to build brand equity and create life-long loyal customers.

• E-commerce offers excellent potential to add a touch of Gamification to the whole experience- every limited quantity of time-sensitive deals, Spin of the Wheel, little %-off coupons sent for abandoned carts, or maybe a gift.
• Keep your loyal customers happy. New customer acquisition costs nearly 5x higher than keeping an existing one. Invest in the relationship, and do reward loyalty.
• Gamification in e-commerce keeps the customers engaged and entertained. Subliminal messages as visual or auditory stimuli can cue the shoppers to purchase, generate awareness, or leave feedback and ratings!

3. A+ CONTENT IS KING
No one likes to look at substandard pictures – let alone click on one to purchase something.
There is no doubt that optimizing product content is a continuous process, but Prime Day is an excellent validation of whether those efforts are finally paying off or not. [Examples]

• Brands can leverage Amazon’s A+ content feature to be a shining beacon to shoppers looking for a warm place- which provides unique brand stories, optimized images and videos, and text and fonts highlighting product features. Unboxing, tech specs, or unique feature videos help too. Immensely.
• Optimizing content will help the Brand to rank better, have better Glance Views, and eventually, Conversions.
  And, piggy riding on Amazon’s recommendation engine’s algorithms, Brand stands a chance to be included in more basket recommendations and help shoppers discover the perfectly curated product they did not know they needed badly!
• For effective Ads aimed at Target segments, brands should conduct A/B testing for their ad campaign variants and utilize the insights during the Prime Days.
  

4. ONE SIZE DOES NOT FIT ALL
Get out of the CRaP!
Yes! You have guessed it right. I was waiting to say that for a long time!
Amazon does not love products that are fundamentally unprofitable for them to sell. They call it by a cool name – “CRaP” which means “Can’t Realize a Profit.”    

An Optimized and lean inventory is the fulcrum around which the digital marketplace works, and brands and Amazon alike will have to work on the economics that makes the model viable.  Grocery and Bulky goods are classic examples of products that lag in online sales- low costs, costly shipping, and sometimes complicated packaging needs. 
Does it not make you wonder why Amazon acquired offline formats such as Whole Foods and Amazon GO? And why sell groceries in their brick & mortar channels?

Unlike a typical brick-and-mortar setup, the Amazon marketplace looks at an Item level viability, and invariably one or the other ASIN/items may land on the CRaP list.  Therefore, how do brands navigate this tricky situation?

• Focus on lean inventory; overstocking will trigger price rationalization, thereby affecting profitability.
• Amazon’s A9 algorithm tracks an item’s prices across various sites –  price your items without much variability
• Rework on product variants and packaging – do competitor analysis, pricing, and shipping cost analysis with an eye on the bottom-line. Most of the Time, 80% of sales will come from the Top 20% of items.
• What sells in brick-and-mortar may not be the right combination for e-commerce. 
  Take snack items, for example. While in the offline channel, it is perfectly acceptable to buy a single packet of chips, but in online mode, brands are better off selling multi Pack combos for economies of scale and because shoppers tend to ‘stock up.’
  

5. KEYWORDS HOLDS THE KEY TO SUCCESS
Customer centricity means that brands are always looking for cues to what customers’ needs and wants are.  Through the Seller Central homepage, Amazon provides the Search Term report, which contains actual shoppers’ data. When used effectively, it reveals what shoppers are searching for and how they are discovering your products.

Can you use this information to formulate your Sponsored ads? – The answer is a resolute Yes!
Can you use this information to fine-tune your product listings? – The answer is again a Yes!

Brands need to curate a list of popular search terms related to the categories they play in.  Along with each search terms, brands need to capture the search frequency rank and the Top 3 Products’ Click Share and Conversion Share.     When aggregated over Time and augmented with Statistics & Math, such a list can immensely help to target top-selling keywords or even reverse search competitors’ ASINs or play in a long tail niche segment.   
When Prime Day arrives, brands will have a ready list of winning keywords and a bid strategy to run great promotions leading to Conversions and Sales.

6. GET SOCIAL
We live in a hyper-connected world where shoppers are always discovering brands, reading reviews online, having social media engagements, etc. Make that 10x more intense during the days leading to Amazon Prime Day with everyone eyeing a bigger slice of the Amazon pie.
Brands need to leverage the clout of social media where every engaging email, brand websites, social media posts, collaboration with influencer/KOL via blogs, vlogs, or twitter work together to create a cohesive, compelling ‘people’ story.
Make your brands be a part of the conversation!

7. BEYOND AMAZON: LEVERAGE OMNICHANNEL AND PHYGITAL
Thinking out of the box, brands should not limit their Prime Day preparations only to the digital marketplace. Leveraging Amazon GO and Whole Foods stores brands can amplify promotions to include shoppers with promotional rebates and offers when visiting the physical stores.

• By focusing on the sensory aspects, brands can engage with new customers with promotions, store pop-ups, product trials, etc. The same shoppers will also find their way online – during Prime Days or even after- and it can be the start of a long-lasting relationship.
• Prime Day is also a big day for other online marketplaces – during 2019, due to the ripple effect and increased promotions and offers- Walmart, Best Buy, Macy’s, Kohl’s, Target, eBay, etc. witnessed increased sales. Armed with the right strategies, brands can amplify their sales and strengthen their presence before, during, or after Prime day on multiple platforms.

In short, Amazon Prime Day is not limited to Amazon anymore. People are looking for value all across the web and even in offline formats.

8. FORECAST: DO THE MATH
Since Jan 2020, Forecasting has become a nightmarish situation for brands due to the Covid-19 related volatile buying patterns.
Top that with a Mega shopping event that runs for 48 hours, netting $10b worth of Sales, the predictions are bound to go awry.

• Brands need to invest in sophisticated Machine Learning (ML) backed Sales and Inventory Forecasting that provides a greater degree of accuracy. ML-based models can forecast random probability distribution and erratic demand patterns, which are characteristic of Amazon demand.
• Some of the data that can help to improve Forecasting are-
  • Internal – Shipments, Order Cuts;
  • Amazon – Consumption, Inventory, Forecast, Order Data, Price Index, Promotions
  • External – Seasonality, Weather, Health Advisory/Pandemic
• Brands can equip themselves with an automated forecasting module and a near real-time Dashboard targeting at least the 80-85^th percentile of order prediction two weeks in advance.
• Before Prime Day, brands should get their basics right on Amazon’s Inventory Performance Index (IPI) by focus on the following blocks-

9. COURSE CORRECTION: WHAT TO TO DURING Amazon PRIME DAY?
I wish I could say – ‘Sit back and relax’!
With pure-play Game Theory at work where trends unfold every minute and market forces make their moves, brands cannot afford to sit back.

• Monitor real-time own vs. Competitors’ strategies on Price, Promotions, and Deals to remain competitive. Invest in AI-based pricing solutions to tweak prices automatically.
• Know the price elasticity of demand – do not hesitate to reprice based on Inventory availability, competitor pricing as long as it meets your strategic goals.
• Enable Social Listening to understand Brand perception, feedback and analyze via real-time BI dashboard
• Walk away from predatory pricing tactics– no one wins that dirty game – ever!

10. AFTER PARTY: RINSE, REPEAT
Amazon Prime Day is the pre-cursor to the incredible Amazon juggernaut that runs yearlong. Brands need to prepare well in advance – a dedicated strategy backed by technology, AI/ML, Business Analytics, data, and an innate cognitive appreciation that e-commerce is not the same as brick & mortar. The ability to invest in technologies and enabling near real-time Analytics & Insights will be the single most important source of competitive advantage in this hyper-connected world. Brands should focus on-

• A scalable business model that moves with a growing e-commerce business.
• Best in Class technology – using Automation, Robotics, Analytics, Visualizations for near real-time visibility
• Understand What Customers are looking for and devise ways to fulfill that need profitably.

When the dust settles in on Prime Day, it is Okay even if your brands did not perform well during Prime Day. Sales should not be the only criteria for success during these two days. Sales are the result of various elements put together with intent and foresight. Brands need to follow the rules of the game, focus on customer-centricity, and conversions will follow.

When shoppers open a carefully packaged box delivered by Amazon, they should be pleasantly surprised to see a friendly note saying -Thank You.    Brands can opt to share their gratitude to shoppers by offering discounts for their next purchases, seeking feedback, placing a small gift tucked in the corner of the box, and so much more.

The possibilities are endless. The results will be enduring if done the right way!
Before I wrap this up, let me list down 2019’s -Amazon Prime Day Best Sellers:

• Fire TV Stick with Alexa Voice Remote
• Echo Dot
• Instant Pot DUO Plus 60
• LifeStraw Personal Water Filter

Are there any guesses which products, brands, and services will top the Movers and Shakers list of Prime Day 2020?  
Most likely, it will be those brands that got their Prime Day strategy right!

Know more about ‘FBA’ – Fulfillment

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