1. Prime Day Consciousness Is on the Rise
Conversion Rate: Highs and Lows
But first things first. What do the numbers say about shopper behavior? Does anything else prove the growing awareness of shoppers about Prime Day? The short answer is yes. Here is why.
10% Increase During Prime Day
The first indication of increased Prime Day popularity among shoppers is a higher conversion rate. In 2022, the conversion rate for Amazon PPC campaigns was 10% higher on Prime Day than in 2021. If we would look into the earlier years, we would probably note an even bigger difference.
Prime Day PPC Conversion Rate:
- 2022: 0.106 → +10% increase
- 2021: 0.096
All right, the Conversion Rate in PPC campaigns was higher on Prime Day. What about before and after the event? We checked the data from 2 weeks before and 1 week after Prime Day. The PPC Conversion Rate in 2022 was still higher than in 2021, for +7%.
Conclusion: shoppers are more aware of Prime Day in 2022 than ever before.
Heavy Drop Right After Prime Day
We recorded a big drop in conversion rates for Amazon PPC campaigns right after the sale event. In comparison with last year, the conversion rate drop almost tripled!
Conversion Rate on the day after Prime Day:
- 2022: -34% drop
- 2021: -12% drop
As you can see, the conversion rate of Amazon PPC campaigns dropped immediately after Prime Day 2022. The recovery took quite some time and it didn’t happen until about a week after.
Two conclusions can be drawn from the available data:
- Consumers are more than aware of Prime Day. They are waiting for it to come and are more than willing to spend their money during the two days when it is running.
- The conversion rate drops immediately after Prime Day is over. As a seller or vendor, you can potentially expect a drop in PPC campaign conversion rate followed by a higher cost per conversion in the few following days.
2. Strong Performance for Lower-Priced Items
At Adspert, we have a large pool of Amazon Sellers and Vendors’ data, from customers who have agreed to an anonymized analysis into the tendencies around global events such as Prime Day. To analyze this year’s two-day sale event we looked at the data from 2 weeks before and 1 week after 12 and 13 July.
After a detailed comparison with Prime Day 2021, the data shows that this year shoppers focused on buying inexpensive items. We recorded a 7% lower conversion value of Amazon pay-per-click campaigns in 2022!
“All indications show that shoppers waited for Prime Day, but were not willing to spend as much as last year.”— Philip Tran, Account Performance Analyst, Adspert
“This year feels a bit different, as shoppers are buying with rising prices top of mind. Almost half of Prime Day shoppers are stocking up on everyday household items—garbage bags, laundry detergent and paper products, etc.—as they look to broaden their savings strategies.”— Carman Allison, VP of Thought Leadership, NielsenIQ, North America
3. Less Fierce Competition
In general, sales events are popular not only with shoppers but also with sellers. Nevertheless, we couldn’t say this is true for Amazon Prime Day 2022. Even though the number of sold products skyrocketed and shoppers were more than ready to spend their money, apparently sellers were in a different mood when it comes to PPC advertising.
Comparing the data between the years 2021 and 2022 and looking at effective CPC (cost per click), it did not change much in 2022 compared to the average.
Much lower change in effective CPC can be attributed to a lower amount of competition. It appears that this year sellers held back when it came to Amazon Advertising. If you were actively advertising, here’s good news for you!
Fewer sellers advertised and the ones that did, did not need to increase their bids that much.
Another possibility indicated by the data is that some sellers may have been priced out already before the Prime Day. Looking at PPC campaigns’ average effective CPC during the same period shows that in 2022 it was about +10% higher:
- 2022: 0.59 → +10%
- 2021: 0.53
Because average effective CPC was higher already around 2 weeks before Prime Day, it is highly likely that a large number of sellers were unable to take part on the actual sale days. Given the current global economic situation there could be other conclusions, but let’s leave those to open interpretation.
Lower Cost per Conversion on Prime Day 2022
When comparing the average values of cost per conversion of PPC campaigns, we can see that it dropped significantly on Prime Day 2022. In 2021, cost per conversion increased by +5%, whereas in 2022, it decreased by -9%. Furthermore, if we are not comparing the averages to each other, but only the values from the years 2021 and 2022, the cost per conversion dropped by a whopping -8%! The reason for the drop in 2022 is the higher conversion rate and the stable effective CPC.
Prime Day PPC Cost per Conversion:
- 2022: -9%
- 2021: +5%
What does all this mean? Conversions on Prime Day 2022 were more cost-effective, so 2022 was probably a good year for sellers.
To sum up, if you properly prepared your advertising for Prime Day 2022 you got more bang for your buck!
To the surprise of many, Amazon Prime Day 2022 turned out to be more cost-effective for sellers when it comes to advertising. There was less competition and bids weren’t significantly higher than on regular days.
Shoppers were more than ever aware of the two-day sale event. They waited for their purchases and filled the shopping carts during sales. This resulted in a record-breaking Prime Day with the most products sold during that event in Amazon’s history!
Given the current global situation, many were concerned about how inflation would affect spending on Prime Day. As we can see, there was no reason for such concerns. Amazon confirmed that Prime Day 2022 was the biggest one so far. We did observe an interesting shift in sold products. The lower-priced products were the ones that won the game this time.
Will it be the same for Black Friday and Cyber Monday? One can only guess. But one thing is for sure – Amazon advertising during sales events makes sense and brings profits!
How Did Your Prime Day Go?
If you would like to improve your advertising efficiency and maximize profits, we can help! Now is the perfect time to take the learnings and set things right before BFCM.