Tips for Sellers and Vendors in 2020 – what a salesperson should pay attention to

As every year the last two quarters are the most important ones for almost every seller and vendor. Especially the 4th quarter, including October, November, and December, is the decisive period of the total amount of sales. In 2020, these last few months will be particularly important, due to the pandemic that started at the beginning of the year. This is also the reason why e-commerce has changed and shifted a lot and thus also had an impact on the Amazon Marketplace.

A particularly important day for Amazon sellers is Prime Day, which usually takes place in the middle of the year. Special offers and discounts, and massive marketing machinery help sellers to reach very high sales. Due to COVID-19 the Prime Day in July 2020 couldn’t take place and has been postponed without naming a concrete date. What remains is the already large summer slump – only this time without a Prime Day bridging. Many brands and manufacturers recorded record sales on Amazon in March, April, and May. This and the shift of B2C commerce to digital sales markets are a result of the pandemic.

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Missing summer-vacation and home office situation have an impact on Amazons 2020 turnover

Unfortunately, the travel-joyful Germans couldn’t take their vacations, as usual, thanks to corona. Instead of traveling to faraway places, many people stayed at home and settled down here. They used the time to invest in products to rearrange their homes. Their favorite consumer goods included tools for the garden, the balcony, and interior decoration. Many of these articles helped them to overcome their painful wanderlust and many categories in the Amazon product catalog were booming, generating enormous sales growth for many retailers.

Another effect of 2020s COVID-19 was the rather forced digitalization of many jobs. The rather shabby associated home office changed into the ultimate life-saving solution for many companies. But working from home, called for more consumer goods. Thus, especially the office areas profited from this situation. Webcams, microphones, notebooks, and office chairs became scarce overnight on Amazon.

Another area that profited from the situation caused by COVID-19 was the sports-sector. With fitness studios closing and the limited leisure sport possibilities, most activities shifted into private dwellings and houses. Thus, the demands on dumbbells, weights, sport bands, skipping ropes, etc. increased. This led to sports-products soon to be sold out for weeks in online shops and on the Amazon Marketplace.

E-commerce final spurt in 2020 – this is what Amazon Sellers have to pay attention to

All the before mentioned factors will have a strong impact on e-commerce revenues in Q3 and Q4 this year. The pandemic caused temporary restrictions on deliveries to the Amazon logistics centers. Due to this and the general uncertainty, many brands and manufacturers on Amazon were able to meet their sales targets. That’s why they are now trying to reach the numbers. But salvation might be near: with the right supply chain and marketing strategies, the presumably lost targets for 2020 on Amazon might still be reachable.

Amazon Prime Day 2020 – Pros and Cons of the shopping event

Usually, Prime Day takes place in July and counts as one of the most profitable turnovers of the year. Due to massive restrictions in the Amazon goods deports caused by COVID-19 and the noticeably reduced flow of goods from the Far East, the Prime Day 2020 has been postponed. A new date has not yet been released but the rumor mill is running. The signs for the Prime Day 2020 happening on the 5th of October 2020 are increasing. At least the beginning of October is considered by many sources as very likely. But this is not yet set in stone. Here are a few reasons for and against this year’s Prime Day:

Why there could be no Prime Day 2020

Due to the massive importance of the day, Amazon initiates enormous advertising measures at a very early stage to maximize consumer awareness. As of today (August 31, 2020), there has not yet been an official announcement of the exact date of Prime Day 2020, which is very unusual. This could be a sign that Prime Day will not take place this year. Another argument against Prime Day 2020 in October is the fact that it might be too close to the equally important Cyber Week in October. Two massive shopping events in a row could be strategically unfavorable for Amazon.

Why there is probably a Prime Day 2020

One of the most important goals of Prime Day is the increment of Amazon-Prime-Accounts. Prime-Users have more value to the company than a Standard-User. Prime-Users spend 3 to 4 times more money on Amazon and use more services such as Prime Music, Prime Video, and Kindle. Prime Day is most likely the most important time of the year to upgrade more marketplace-platform users. Right now, July 2020, the increase in Prime customers this year might have been much smaller than it otherwise would have been. Even though the possible new date, October 2020, is very close to Cyber Week, there are still about 6 weeks between the two shopping events. So, there will be enough time for Amazon to fill its logistics centers for the end of the year.

Another positive sign for Prime Day to take place in 2020 is the Prime-Day-Trainings from Amazon, that already took place. Amazon service providers, like our Amazon agency, for instance, have already been set up with important information regarding Prime Day. Some vendors and sellers also have been requested to send in Promotions such as Lightning Deals. So, it looks like Prime Day is happening in October. However, there is no guarantee.

Amazon Cyber Week 2020

So far nothing has changed in the fact that at the end of November, more precisely from 23.11. to 30.11.2020, the Amazon Cyber Week will take place. Amazon has also heralded the Christmas shopping season in recent years with many deals and special offers. This has significantly increased sales, especially in technology-heavy categories but also in many other product areas these days. The date for Amazon Cyber Week 2020 has been set for quite some time and has not changed until now. The only reason for a restriction or even cancellation of this important shopping event is once again the effects of the pandemic. Should there be a “second wave” at the end of the year, restrictions may also affect Amazon logistics centers. However, the company should have learned from Q1 and Q2 and prepared itself better.

Amazon Black Friday 2020

The most important day during Cyber Week is Black Friday because this is where Amazon has had the most deals and the highest discounts in the last few years. This year it’s assumed to be similar and that Black Friday 2020 will be a sales highlight day and will be massively promoted by Amazon in the media. We expect an enormous increase in traffic in the marketplace, which will also lead to a peak in sales for professionally optimized and readily available products.

Amazon Cyber Monday 2020

If there is going to be a Cyber Week 2020, there is also going to be a Cyber Monday 2020 on Amazon. This day traditionally follows the Black Friday. Although Cyber Monday takes place at the beginning of the week and therefore will be less traffic, the day surely will be prepared with many Lightning Deals and special offers. The official date for Cyber Monday is the 30th of November 2020, which also is the final day of Cyber Week.

Amazon Christmas Shopping 2020

There is no official start for online Christmas Shopping period on Amazon, but by looking at the increasing sales of many retailers, Christmas Shopping for many consumers traditionally starts in early November and goes until mid of December. Especially at Amazon, many customers purchase last-minute presents because for prime customers a punctual delivery of the Christmas presents is guaranteed by Amazon for many articles until December 20th. For some German cities last year there was even a promise of delivery until 23.12. by means of same-day delivery and this will hardly change this year and clearly differentiates Amazon from many “free” online stores.

Measures and preparations for Q4 2020

If you take a look at the chronological sequence of the various Shopping-Events on Amazon, you can expect an enormous increment in traffic on Amazon, from Prime Day presales-phase which starts in mid-September 2020 to Last-Minute-Christmas which ends on the 23rd of December 2020. Additionally, the special pandemic conditions this year (limited travel opportunities, sports and leisure activities, home office, etc.), as well as the massive shift from B2C sales to digital channels, a completely new starting position for brands and manufacturers will arise in Q4 2020. Those who prepare themselves properly and provide enough budgets will not only be able to catch up on previously unfulfilled sales targets but will also enter the next fiscal year stronger than before.

Inventory planning on Amazon

A lot of traffic on the Amazon marketplace also means that as a trader you should urgently avoid an “Out of Stock” situation. The upcoming shopping events, the desire to buy as well as the increased awareness for Amazon itself during the crisis should not be underestimated. Just as predictable as the Christmas business, however, are industrial action by local unions and the logistical problems that may accompany them. Retailers should prepare themselves well for the last four months of the year by making sure that they have enough stocks of goods.

If you take part of the FBA program, the delivery route to Amazon is equally important. Over 100,000 sellers operate on the German Amazon marketplace and many of them use Amazon’s fulfillment service. Therefore, a certain amount of rush on the warehouses is to be expected, which is difficult to predict exactly but should be planned for sure.

Vendors completely depend on the so called “Purchase Orders” (PO), which are mostly automatically activated orders for goods. If you have a vendor manager at your side, you can and should consult him or her on how to avoid peak times and, if necessary, a shortage of your own inventory on Amazon. Manually activated POs have become very rare, but still possible. Vendors who do not have a direct contact person at hand on Amazon and who otherwise complain about a lack of POs or too few POs should urgently (at least in perspective) think about an own seller account. There is still time to set up an account in a short period of time and have it ready for the Christmas business.

Amazon marketing and media budget planning

In the area of amazon marketing, it is very common to hear the following sentence: “when Prime Day arrives, it is not necessary to change things on your campaign. Neither to increase the budget nor to set up a separate campaign – just let everything be, the conversion will be good either way.” This statement isn’t completely wrong. Because of the significantly higher traffic and an increased willingness to buy from Amazon customers, there is simply much more going on in the marketplace on seasonal highlights such as Prime Day, Black Friday, and Christmas Shopping. If you leave the PPC campaigns as they are, they will most likely perform much better than at “normal” times.

But there is another side of the coin: how much traffic and sales could have been generated additionally with adapted campaigns and budgets for Prime Day and Co.? If you leave everything as it is, you’re just making better use of your usual framework. It’s very likely that you could have generated much more revenue “on top”, if you had just realigned the campaigns to the seasonal highlights.

Of course, this assumption is purely hypothetical, but nevertheless plausible. If traffic and willingness to buy increase selectively on a shopping platform such as Amazon, as a vendor, seller, or advertiser you should react accordingly. What does this mean in concrete terms for marketing and budget planning on Amazon?

Amazon Advertising Campaign hints for Q4 2020

Hint 1: Amazon PPC selectively raised daily budgets

As previously mentioned, the traffic increases during seasonal highlights, such as Prime Day and Co. Preset daily limits of PPC campaigns can be used up faster right now. That’s why budgets of already well-running campaigns should be raised by 30 to 50 percent during the “hot phase”. There is no concrete limit for a lower or upper limit, and it depends on its category and its products. With an approximate ACoS target or ROAS target, the profitability of the advertising measures can also be roughly monitored and ensured. Important to remember: the ACoS or ROAS alone are not always the best metric for measuring campaign success. Nevertheless, these values provide an initial indicator of whether and how the respective ads are currently running.

Hint 2: Focus on Amazon Bestsellers

Especially on Prime Day, Cyber Week, and during the Christmas season, it is worthwhile to focus on the advertising campaigns for bestsellers in your own assortment. Experience shows that products that are already selling well in other areas, can be brought to the consumer especially well at this time. Therefore, the Amazon advertising reports, and/or sales statistics should be evaluated and the most important ASINs should be defined. Provided that a good campaign structure is in place, the higher daily budgets should now be focused on campaigns that include these bestselling products.

Hint 3: Temporal start of additional PPC Campaigns

It also might be worth setting up new temporary campaigns especially for Amazon Prime Day or for Cyber Week. These campaigns are mostly for the topsellers or bestsellers from their own portfolio. This has the advantage that it isn’t necessary to change or to adjust completely the structure of the campaign. Far more interesting is to invest selectively in the increased advertising budget. Important: compile on time the new campaigns. Like the organic keyword-ranking and the associated BSR (Amazon Bestseller Rank), PPC campaigns also rely on a sales history. Therefore, additional PPC campaigns should not be set up shortly before or directly on Prime Day itself, but at least one to two weeks prior to the event. This way the Amazon algorithm still has time to learn and the campaign’s performance will probably be better.

Hint 4: Observe Target-Group and Retail Readiness

Even if the conversion rate is noticeable higher on days like Prime Day or Black Friday, it should have opted for the right products. Products that sell very well in spring or summer will not sell well in November, although it involves the highlight days. Sellers and vendors should mostly rely on consumer products that you can use in your own 4 walls (be aware of the colder seasons) and on the ones that are ideal as Christmas presents. It is also important that these products are “retail-ready”. This means: an Amazon Optimization (SEO) of the product data was done before, at least three high-resolution and qualitatively professional product photos are available, the ASIN has collected at least 10-20 mostly positive reviews and there is possibly A+ Content and a Brand Store. Brief: the product has to be perfectly suited for sale on Amazon.

Hint 5: Start ASIN Retargeting from Amazon DSP

Not every user decides immediately to buy a product. Even if the conversion-rate (CVR) on Amazon is visibly higher in comparison to almost all other platforms in the e-commerce area, not every click turns out to be a safe purchase. The huge number of products on Amazon often implies a longer customer journey that can be used as an advantage. With Amazon retargeting campaigns for their topseller products which are already advertised with PPC campaigns, one can maximize the selling chances and increase the brand perception of their products. The purchase probability is higher not only on the highlight days such as Prime Day and Black Friday but also in the period directly before and after this time. Exactly that can be used with Amazon DSP campaigns and e.g. purposely advertise the products of competitor brands form the same market segment. Important: it can take about one to two weeks until an ASIN retargeting campaign is running. That also means that an appropriate lead time should be calculated for this promotion measure.

Result: Q3 and Q4 in 2020 on Amazon particularly important

This year’s pandemic caught us off guard and mostly swirled up the commerce sector. New possibilities that weren’t there before raised, especially for the e-commerce and for Amazon Sellers. Even if the second half of the year is difficult to predict, something is certain: most of the consumers have the money and want to spend it. If they couldn’t enjoy a “real” vacation in 2020, then at least it should look pretty at home and a crowded table of presents at Christmas should help them to overcome their restrictions. For brands, manufacturers and sellers this means: Amazon is going to be very interesting in Q3 and Q4. Especially the last 4 months including the shopping highlights as Prime Day (probably taking place at the beginning of October), Black Friday, Cyber Monday and the Christmas Shopping with all their lead and follow-up times, are an almost continuous “Hot Zone” that should be used.

Important thereby is: differently than Google, Amazon is a closed ecological system. Clicks and conversion generated by paid advertising can have a lasting impact on organic visibility. Therefore, who makes the right strategic use of the last four months of 2020, has a good chance of starting stronger into 2021.

Amazon Marketing Support and Consulting

Over the last 4-5 years intomarkets, as one of the leading Amazon marketing agencies, has successfully advised many brands, manufacturers and, sellers. The company implemented advertising measures and carried out product optimizations. Thereby, we are significantly increasing visibility and sales. Especially for the last and so important months of the year, it can be worthwhile to consult external experts to boost sales and strengthen your own brand on Amazon.