Understand all the options and get the most bang for your buck.
Running bloated and costly promotions on Amazon will inevitably end up hurting your profit.
We spoke with Maria Zarkova, Bobsled Account Specialist, about the importance of implementing successful promo campaigns on Amazon.margins.
Conversely, by avoiding promotions entirely (or running campaigns that don’t get any traction) you run the risk of getting left behind by the competition.
On the right: Bobsled Account Specialist Maria Zarkova
Amazon Promotions Overview
“Every type of Amazon Promotion can have its moment in the sun,” explains Maria. “It’s important to understand the differences between each of them. That way you can make an informed decision about which to use in each situation.”
- Deals are limited time discounts
- Lightning Deals run for 4-6 Hours vs 7-Day deals which run for a week
- They all appear on the Amazon Deals page which is one of the most highly trafficked parts of the entire marketplace
- Only certain products are eligible – on Seller Central, you have to be invited to take part in a Deal
- Lightning Deals are not cheap. Typically they will cost $150/deal but this increases to $300 to $500/deal during peak traffic events such as Prime Day, Black Friday, Q4 etc
- Deals are fantastic for generating Brand Awareness – you are almost guaranteed to generate a lot of traffic – but this doesn’t necessarily translate into conversions
Conclusion: Deals are generally better suited to established brands. Sellers just starting out should generally look at other promotional options.
Above: Screenshot from the Amazon Deals page.
- Set up a limited-time promotion offer or provide a code that customers can enter at checkout to receive a discount
- Both the Promo Offer and the Codes appear below the fold on the product detail page (not that easy for customers to find)
- Percent-off promos are free to run and easy to set up
- You can choose either a dollar amount or percentage off
- You can use Advanced options to set up a promotion with a tiered discount structure. This allows you to upsell the customer e.g. Buy One Get 10% on the Second Item
- The main challenge is that the percent-off promos don’t show very prominently on the product detail page
- Amazon also doesn’t make it easy for customers to redeem a percent-off discount
Conclusion: Percent-off promos are good if you are trying to move excess inventory in a short amount of time.
Above: Percent-off promos appear below the fold on the product detail page.
Social media promo codes
- A percent off discount is automatically applied through a custom url which brands share on social media
- You can bundle complimentary products together – there can be multiple eligible items for a single social media promo
- This promo is only really useful for brands with a sizeable social media following
- You are also not attracting any potential customers already inside Amazon who are, in theory, closer to making a purchase vs your followers browsing social media
Conclusion: Useful for cross-promos on social media and capturing new customers more likely to purchase on Amazon vs your own ecommerce store, especially if a discount is automatically applied.
Above: Multiple items can be eligible for the same social media promo code.
- Discount tool with a finite lifespan
- Easy to set up and great visibility – coupons appear prominently on the product display page, the search results page and Amazon Coupons page
- Seller dictates the coupon budget – it will end automatically when 95% of the budget has been depleted
- The cost to run a coupon is the chosen discount plus a $0.60 fee per redemption
- Because coupons appear on the search results page, expect an increase in traffic and conversion rate
- If you don’t own the Buy Box the coupon won’t show on the Product Page – the customer will need to select your offer to redeem the coupon
- Need an average product rating of 3.5 stars or more, so coupons aren’t good for brand new products
Conclusion: Officially the Bobsled team’s favorite promotional tool!
Above: Coupon tags appear prominently on the product detail page.
Prime exclusive discount
- Prime members will be able to buy your product at a discounted price
- Free to set up, no invitation required, only valid for Prime members
- Minimum discount is 10% or 20% for total products
- Obviously only valid for Prime members – if your niche attracts a lot of non-Prime members this will hurt redemptions
Conclusion: Don’t expect to see a huge bump in sales – Prime exclusive discounts are more of a marketing tool for Amazon.
Above: Example of a Black Friday Prime Exclusive discount.
Why Does The Bobsled Team Love Coupons So Much?
According to Maria there are two main reasons: visibility and control.
“In respect to visibility, Coupons appear on the search results page. They help your product stand out from similar products that are priced normally. Your coupons are also visible in any advertising tied to the promoted products and on the Amazon Coupons Page,” she says. “Coupons appear in multiple locations on the product detail page itself, including right next to the Buy Box. So unlike other promos, it’s hard for customers to ignore them.”
“On the control side of things, with Coupons you know exactly how much you will spend before the promo starts. At Bobsled, we always recommend that brands invest in some level of PPC advertising. Your PPC spend is always going to fluctuate because it’s linked to market forces. This is not the case with Coupons. You control the Coupon discount and the total budget for the entire promotion. This is great for all brands, but especially helpful for those with very tight profit margins.”
Amazon Brand Analytics As A Promo Tool
Brand registered sellers have access to the Brand Analytics tool. This tool provides great insights into the account, but it can be useful for running promotions as well!
“The ‘Market Basket Analysis’ shows the products your customers often buy together,” Maria explains. “This information can be utilized to create Buy One Get One (BOGO) promotions or Tiered Promotion Since you see that your customers are already interested in buying some products together, why not boost sales for both SKUs by offering the products at a slightly lower price?”.
“Also, ‘Item Comparison’ and ‘Alternate Purchase Behavior Analysis’ shows you the percentage of times your customers compare products, and also what your customers ultimately ended up buying once they visited your Product Page,” Maria says. “This information can also be valuable for running promotions. If you notice a pattern in the products that customers compare, there is a huge chance your customers will end up buying them both if they see them promoted. So why not run a BOGO or bundle them into a coupon?”
“The same goes for ‘Alternate Purchase Behaviour’. The products that often appear together could be a great fit for a BOGO promotion. Even if customers end up buying products from another brand, this can still be useful to run a promotion of a similar product you have in your catalog; maybe the price was the reason they ended up buying from the competitor.
Amazon Promotions For New Products?
Promotions are generally designed to help products that are already up and running.
“Some promos are invite-only, others need a minimum number of product reviews, so you can’t rely on Promotions to jumpstart traction for brand new products,” Maria says. “It’s important to ensure new listings are professionally optimized for organic search traffic and on-page conversion. You should also consider Amazon’s Review Programs like Vine and the Early Reviewer Program for those crucial first product reviews. Additionally, Brand Registered sellers can go a step further and organize Amazon Livestream around their new product or create Amazon Posts to educate potential customers about the new product.”
For more information about Amazon product launch best practices, read our recent interview with Bobsled CEO and Forbes contributor Kiri Masters.
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