The Good and the Bad from Prime Day 2024

Winners: Apparel, Giftable Products, and Electronics

As expected, certain categories performed exceptionally well during Prime Day 2024. Apparel, giftable products, and electronics were the top-performing categories, with significant sales spikes. These are products that people often look for during sale events, and many customers take advantage of discounts to either stock up or purchase gifts for upcoming occasions.

However, not all categories shared the same success. For example, supplements and year-round essentials saw only a modest increase. While there was some sales growth, it wasn’t at the same level as those more “seasonal” or “giftable” categories. Brands in these less seasonally driven markets should take note that Prime Day may not always result in huge spikes and should set realistic expectations for future sales events.

Overspending on PPC Campaigns

A notable challenge faced by many sellers was the sudden increase in Amazon’s PPC ad spend. For some brands, ad spend surged well beyond their set budgets, particularly on Prime Day, even with established budget caps in place. In some cases, Amazon exceeded daily ad budgets by significant amounts, leading to increased spend that didn’t always result in proportionate sales increases.

This spike in ad spend caught many off guard. For instance, a supplement brand that typically spends around $450 per day on ads saw its budget jump to over $1,000 on Prime Day. Despite the additional ad spend, the return on investment (ROI) did not reflect such a dramatic increase. This scenario occurred across multiple accounts and is something that brands should be cautious about when planning their advertising strategy for Black Friday and Cyber Monday.

Key Lessons for Black Friday & Cyber Monday

1. Watch Your PPC Budget Closely

To avoid unexpected overspending during future sales events like Black Friday and Cyber Monday, you must keep a close eye on your PPC campaigns. Ensure that your ad spend is set to a reasonable daily cap and that you are utilizing all features that allow you to control spending.

One of the best strategies is to adjust your campaign budget caps to closely align with your actual desired spend. If you leave room in your budget or have unspent budget amounts, Amazon may over-allocate that extra budget on high-traffic days, which can negatively impact your profitability.

If you are unsure whether your campaigns will stick to the budget, consider lowering campaign-level budgets or pausing campaigns that aren't performing well.

2. Use Coupons to Boost Conversion Rates

Another valuable insight from Prime Day 2024 was the effectiveness of coupons in boosting conversion rates. By offering even a small discount, like 5% to 10%, brands were able to increase their conversion rates from 3% to 4% or higher. This is particularly important on days like Black Friday and Cyber Monday when competition is fierce, and buyers are specifically looking for deals.

Coupons offer more flexibility than traditional Amazon deals, as they allow you to set your discount without being restricted by Amazon's minimum deal requirements. This flexibility can help you improve your conversion rates without sacrificing too much margin.

3. Focus Your PPC Spend on High-Performing Keywords

Another important takeaway is the need to target your PPC spend narrowly. On Prime Day, brands that funneled their ad budgets into high-converting, relevant keywords saw better performance. Instead of distributing your ad spend evenly across all campaigns, concentrate it on the terms and campaigns that historically deliver the highest returns.

For example, brands that increased their spend by $500 to $700 per day on their top-performing campaigns saw a significant boost in sales without their TACoS (Total Advertising Cost of Sales) exceeding their targets. This approach ensures that your PPC dollars are being spent efficiently and effectively, maximizing your return on investment.

Preparing for Black Friday & Cyber Monday

With Black Friday and Cyber Monday just around the corner, now is the time to make adjustments based on these Prime Day learnings.

1. Set Your Budgets in Advance

Make sure your daily budgets for PPC campaigns are realistic and capped at a level you are comfortable with. Double-check that you have no "unspent" budget enabled, as this can lead to overspending on big sales days.

2. Implement Coupons

Create coupons for your top-selling or most giftable products to increase conversion rates. Even a modest discount can go a long way in convincing hesitant buyers to convert.

3. Scale Smartly

If your products have room to grow, allocate more ad spend to them but ensure this is done strategically. Focus on high-relevance keywords and campaigns with the best conversion rates.

4. Test Your Strategy Early

If possible, run tests on your budget and ad strategy ahead of time. By conducting small-scale tests, you’ll have a better understanding of how your campaigns will perform under pressure and can make necessary adjustments before Black Friday and Cyber Monday.

Conclusion

Prime Day 2024 provided valuable insights into how to prepare for the upcoming shopping season. By keeping a close watch on your ad budgets, using coupons effectively, and focusing on high-converting keywords, you can position your brand for success during Black Friday and Cyber Monday. Preparing now will not only help you avoid costly mistakes but also increase your chances of capitalizing on one of the most lucrative shopping periods of the year.

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