4 minutes

How to Prepare Amazon For Holidays 2021

Driven by the COVID-19 pandemic, brands were forced to embrace eCommerce, and with that, recognize Amazon as a central role in their overall business strategy. Brands can no longer ignore Amazon’s relevance, or depend only on their owned channels to scale their business and compete in a marketplace-dominated retail industry.

With the holidays just around the corner, it’s time to optimize your Amazon marketplace strategy.

Amazon Holiday 2020 Insights

Back in the day (pre-2020), consumers could be seen racing around department stores and spending hours on foot picking out all their gifts at major retailers during the holiday shopping season. With the COVID-19 pandemic, and an evolving industry, this picture has changed. Today, you’ll find an increasing number of shoppers surfing Amazon’s marketplace on their mobile device, making one-click purchases right from the comfort of their own couch.

Last year’s Amazon holiday season reflected this with a record-breaking success. The 2020 holiday season kicked off with a delayed Amazon Prime Day on October 13-14th, resulting in an extended shopping season. Third-party sales were up 50% YoY globally during the holiday period. Overall, more than 1.5B toys, home products, beauty & personal care, and electronics were shipped worldwide.

Beyond the online marketplace, independent businesses saw an increase to $4.8B from Black Friday to Cyber Monday, up 60% YoY. Meanwhile, brick & mortar stores saw a 52.1% decrease in traffic on Black Friday due to many major big box retailers closing their doors on the holiday. By the end of 2020, 78% of U.S. brands were selling on Amazon, up from 55% in 2019.

Overall, eCommerce saw a 35% increase in holiday sales last year, and we expect to see these same trends continue in the 2021 holiday season. If Amazon Prime Day 2021 was any indication, Amazon sellers can expect to see equally impressive sales.

Amazon Strategy for Holidays 2021: The BVA Approach

With Amazon’s Q4 2021 shaping up to be another successful season, brands cannot afford to wait on preparing their strategies for the final stretch of the year. Preparation and planning are critical, and it isn’t too early to start.

Amazon Content & SEO

More than 55% of consumers start their search for products on Amazon. Having high quality product detail pages and implementing relevant keywords will help your products get matched to the audiences that are most likely to convert.

Not to mention, this is the perfect time of year to review your listings. Ensure that product pages have rich content with high quality titles, bullets, descriptions, and images. According to our marketplace optimization partner, Teikametrics, top sellers across every category and every price point tend to have longer descriptions and more images.

Another important focus area this time of year: performing keyword research. Merchants must determine and concentrate on your target audience and then include keywords in your product listings. If you haven’t already, learn how to use backend keywords.

Taking these actions can help match the consumer to your product, and allows them to make an informed purchase decision after they have landed on your product detail page.

Inventory

The biggest business challenge during the holidays can often be inventory. With Amazon, be aware of all key dates that FBA (Fulfilled by Amazon) inventory must be shipped into Amazon fulfillment centers to be processed in time for major shopping days, such as Black Friday & Cyber Monday. You should also be reviewing stock levels regularly to make sure you’re prepared to meet the holiday shopping demand.

On the other hand, if Amazon FBA is no longer an option, consider offering FBM (Fulfillment by Merchant) with free and fast shipping if you have in-house logistics available to allow for this option. This is a good alternative to consider for direct-to-consumer merchants that are also selling on Amazon.

Winning the Amazon Buy Box

Winning the Buy Box is critical to a brand’s success with 82% of Amazon sales going through the Buy Box. The percentage is even higher for mobile purchases. If you are not winning the Buy Box, this will also affect your ability to advertise your products.

When thinking about how to win the Buy Box, these are a few key considerations:

  • Make sure to report any unauthorized or counterfeit sellers to Amazon.
  • Plan your holiday pricing strategy to beat out the competition if you are not a proprietary brand.
  • Consider your profit margin, and consider a method of repricing - manual, rule-based, or algorithmic repricing.

Amazon Advertising

This is the time to start ramping up your advertising efforts to capture sales before, during, and after the peak shopping period. Marketing your brand during the holiday season will give your business a chance to stand out from the competition. AI-powered tools, such as Teikametrics, helps brands save time by easily optimizing their advertising performance, and increases their efficiency of ad spend. Overall results of the entire holiday period is what is important, not how any single day or or week performs.

Here are our top tips for Amazon Advertising during the holiday season:

1) Start ramping up advertising now. This will help campaigns pick up momentum. Shoppers are not waiting until Black Friday & Cyber Monday to begin their holiday shopping.

2) Determine your holiday advertising budget. New updates and changes across digital marketing platforms has caused brands to shift ad spend to Amazon advertising. A general rule of thumb is to forecast a budget that’s minimally 20% more than what was budgeted for the rest of the year. Adjust daily budgets to avoid any “out of budget” time, especially during high-traffic shopping days.

3) Create a funnel strategy and determine advertising goals. Full-funnel marketing allows you to engage customers from the top of the funnel (awareness) all the way to the bottom of the funnel (purchasing).

  • Increase awareness through Amazon DSP, Sponsored Brand, & Sponsored Brand Videos.
  • Increase consideration through Sponsored Display, Sponsored Products, & Sponsored Brand.
  • Increase conversions through sponsored Products & Sponsored Display.

As a rule of thumb, remember: Profits and conversions = lower Advertising Cost of Sales (ACoS), higher ROAS Increasing brand awareness = higher ACoS, lower ROAS

BVA Approach to Amazon

4) Prepare your Amazon Brand Store to receive the extra traffic. Monitor inventory levels routinely. Products can’t be advertised or sold if they are out of stock.

Amazon Promotional Strategy

Black Friday and Cyber Monday are huge shopping events, but the entire holiday season from November to January offers plenty of opportunities to drive increased traffic and sales with deals, coupons, and discounts.

Promotions are effective with increasing visibility and with increasing organic sales, but also affect ad placement. Determine what type(s) of promotions you will be running. Types of promotions can include:

  • Coupons
  • Lightning Deals
  • 7 Day Deals

When choosing your Amazon promotions, note that coupons are less risky and costly, with fewer requirements. They offer more flexibility and control over scheduling. It’s also important to consider your profit margin and sales goals. Deeper discounts are generally best for Black Friday and Cyber Monday, while lesser discounts can be highly effective on other days throughout the season.

Finally, you want to create a promotion calendar. Plan your promotions ahead of time, and be aware of the submission dates.

BVA’s Bonus Tip: Don’t Limit Yourself

The holiday shopping season doesn’t have a set start date, nor does it have a hard stop. Keep in mind that Amazon has the fastest logistics program that allows for an extended shopping season for last-minute shoppers. And of course, inventory planning, promotional planning, and advertising planning are all important for post-holiday shopping when customers are using their gift cards.

Closing Thoughts

Take this time to give Amazon Q4 planning the attention it deserves, and give your brand an advantage during the holiday shopping season. The holiday season is the busiest time of the year for Amazon and eCommerce in general. Now more than ever, customers are shopping from the comfort of their own home, and there are more brands to compete against for their attention. Proper preparation and execution will allow your business to reap the benefits.

Looking for an Amazon and online marketplace strategy team? Book some time with ours here.