I believe everyone has their own feelings about the Prime Day that has just passed. In today's Huiwang article, Huiwang will share with you the overall sales of Prime Day this summer, the performance of third-party sellers, and the problem of skyrocketing ACoS that everyone is generally concerned about. At the same time, we will also look forward to the trend of cross-border e-commerce and Amazon in the second half of this year with you.
Part 1: 2022 Prime Day breaks records again
Although Amazon has not yet announced the total sales of Prime Day last week, it has announced that it sold 300 million items in two days of Prime Day this year, which is 50 million more items than 250 million items in 2021.
Bloomberg Finance reports:
The average settlement amount of a single order per consumer is $55.26 this year, an increase of 16.8% over 2021; the total number of orders placed by the 21,306 surveyed household units is 58,934, which is equivalent to 2.77 per household on Prime Day. Single; 2/3 of households did not compare Amazon's price with other platforms when shopping on Prime Day Amazon's total Prime Day sales this summer was $12.5 billion (about 81.25 billion yuan), an increase of about 17% over last year's Prime Day overall. In general, although inflationary pressures are high, consumers in the West, especially in the United States, are still very willing to buy when they see a discount.
Part II: Historical data to see the trend of Amazon
In order to further analyze the future trend of the Amazon platform, Hui.com has made statistics on the sales of Prime Day from 2015 (the first year) to this year. You can see from the following figure:
A few numbers are worth perusing:
Prime Day historical data comparison:
1. Compared with 2015, Prime Day sales in 2016 increased by nearly 70%, which can be understood as the rapid growth of Amazon.
2. Compared with 2017, Prime Day sales in 2018 increased by more than 73%. It can be said that it was the year when Amazon really took off. It was also the year when the number of registered members of Amazon's global Prime exceeded 200 million.
3. The sales growth of Prime Day in 2019 is still more than 70% compared with that in 2018, but it should be noted that there are 2 days of Prime Day in 2019, and only 1 day in 2018.
4. The global epidemic broke out in 2020, and the epidemics in various countries are one after another. Since Western countries are basically in a state of risk control, most people can only shop online. Amazon also had to postpone Prime Day to October, and Canada was at the last moment because of FBA. Prime Day event cancelled due to outbreak in warehouse. But Amazon's Prime Day sales are still up 45.25%.
5. During Prime Day in 2021, the epidemic situation in the West is still stalemate, but offline supermarket operations have gradually resumed. In this case, Prime Day in 2021 will still increase by 7.6% compared with 2020, which is not easy;
6. In previous articles, we called this year's Amazon Prime Day a big test for Amazon itself, mainly because:
(1) 2015-2019 is a very active 4 years for the global economy, so we cannot compare this year when the epidemic has been raging for more than 2 years and the Russian-Ukrainian war is still anxious with the year before 2019;
(2) If the epidemic in 2020 has made Amazon almost the few or even the only shopping method for everyone in the West, and in 2021, various Western countries will issue consumer coupons to stimulate Amazon’s sales to further increase, then the blow and difficulty that Amazon has suffered this year More than ever before, including: offline supermarket sales have rebounded after the epidemic, labor costs have soared, oil price inflation has hit a new high in nearly 30 years, and China’s domestic epidemic control has brought uncertainty to the supply chain, etc. In this case, Amazon's sales can grow against the trend, and it can also be felt by most small and medium-sized Chinese merchants, which is very difficult;
(3) Before Prime Day, many people, including Hui.com, believed that this year's inflation would largely restrain consumption in the West, especially in the United States, but the actual situation shows that while inflation has soared, the Amazon platform has become The only platform where you can find cheap goods, reduce living expenses, and maintain quality of life!
Therefore, it is not easy for Amazon's Prime Day sales to achieve a growth of nearly 17% this year. At the same time, we can also clearly see that: in China, the epidemic is one after another, and the closure and control of countless companies and Amazon have become Chinese entrepreneurs, companies, factories, and even well-known companies. While creating uncertainty, compared with other platforms, domestic e-commerce, and even traditional foreign trade, Amazon is one of the few, if not the only, hope and safe havens .
Part 3: Amazon China seller feedback on Prime Day
First of all, let's review the feelings and feedback of the past Prime Day Chinese sellers:
1. Prime Day in 2015-2016
Let Chinese individual entrepreneurial sellers develop rapidly
2. Prime Day in 2016-2017
Chinese sellers have a double harvest of sales and profits
3. Prime Day 2017-2019
Small and medium-sized Chinese sellers and traders have begun to enter Amazon on a large scale, and fraudulent orders and illegal evaluations are rampant. Before the start of Prime Day in 2019, Amazon almost removed many big seller reviews overnight. It was also the beginning of that year that Amazon began to strictly clean up black technology and violations.
4. Prime Day 2020
Due to the epidemic, many traditional foreign trade and domestic e-commerce sellers began to crowd into Amazon. In a year that was rich in revenue, on Prime Day and Black Friday, due to excessive involution, CPC increased significantly, and vicious price competition made it difficult for many sellers bear.A large number of stocks are unsalable and backlogged in Amazon warehouses
5. Prime Day 2021
Amazon banned the accounts of sellers who violated the rules on a large scale, and the top sellers fell down countless times.All small and medium-sized sellers are in panic. At the same time, due to the serious inventory backlog in 2020, in order to clear the remaining inventory as soon as possible on Prime Day last year, many sellers are still serious.
6. Prime Day 2022
Many Huiwanghui members shared their Prime Day feelings with us on the first day of Prime Day:
(1) Order growth
Most Huiwang Hui members told us that the orders on the first day of Prime Day rose at least 3-5 times than usual, and some Hui members’ orders rose 10-15 times! Compared with 2020, this year's Prime Day orders basically reached or even exceeded last year's Prime Day sales on the first day!
Although there are also feedback from sellers and Hui members that this year's sales are flat or slightly increased compared to last year, but we have hardly seen the vicious competition in the past. Compared with last year, we have almost heard no feedback about the decline in profits or the backlog of inventory, while many Sellers are optimistic about Amazon's sales in the second half of the year.
While some sellers are positive about this Amazon Prime Day, we also see sellers expressing disappointment with this big promotion, including:
1. Dafu, which did not see a rise in sales
2. Profits are not growing
3. Advertising ACoS skyrockets
Compared with the sellers who positively commented on this Prime Day, Hui.com saw not many sellers who were disappointed with the effect of this Prime Day . After understanding the specific situation with these members and sellers, we see:
Negative feedback is not "no growth":
1. Most sellers who reported that there was no increase in Prime Day orders did not participate in on-site activities
2. It is a common phenomenon that the profit of a single item has not increased, but in terms of the overall unit volume, the overall sales profit of Prime Day has increased a lot.
3. Several Hui members who are also doing domestic e-commerce said that in order to obtain the same order increase effect on Double Eleven in China, Tmall, Pinduoduo and Douyin must invest more in promotion and advertising than usual. The discount is bigger than usual, and it is also a loss of money to double the sales in time. However , it is almost impossible for Amazon to declare the Prime Day exclusive discount for free, and the discount is not large enough to double the order by 10 times .
Part 4: Ad Cry
Regarding the problem of the skyrocketing ACoS of advertising on Prime Day, I believe that many members and sellers are still fresh in their memory. On Tuesday morning, US time, Amazon Prime Day began, and many sellers began to guard the spike and advertising CPC. But soon found that advertising ACoS skyrocketed, and the advertising budget opened was almost a second. Some sellers even found that ACoS (the proportion of advertising expenses in sales) exceeded 1000%. The same problem occurred with many seller accounts operated by Huiwang Zhiying.
Next, many sellers started to stop advertising on Amazon in a hurry, and then they were surprised to find that orders began to surge, mainly from:
1. Prime exclusive discount
At about 11:00 p.m. West Coast time in the United States, I saw an Amazon ad with an extremely high ACoS in the morning, and the ACoS actually began to drop significantly.
After looking at Amazon's front and back offices, we found:
1. There is a serious lag in Amazon's advertising data on Prime Day, that is, the orders that were originally advertised were not displayed until the evening.
2. On all Lisitng pages where Prime exclusive discounts take effect, the usual shopping cart is replaced by exclusive discounts
However, the above situation has virtually helped most sellers save advertising costs. Imagine if Amazon could display the CPC and ACOS of advertising in real time at that time, it is very likely that everyone would continue to increase the advertising budget during the two days of Prime Day.
Part 5: Inspirations for Fall Prime Day
To sum up what we saw this Prime Day:
What's driving the growth in Prime Day sales?
1. Products with skyrocketing orders are concentrated in the top #100 products in the precise category BSR. The higher the BSR ranking, the faster the order growth, especially the top #10 products in BSR.
2. In general, the Prime Exclusive Discounts on Prime Day this year performed well, even surpassing the spike;
3. The BSR ranking is low, and the sellers who have not declared any activities, and have not declared Prime exclusive discounts and coupons generally have little growth in order sales.
In conclusion, we can realize the difference between Amazon's operation now and the past:
How to get ready for Prime Day this fall
1. The peak Amazon shopping seasons every year are Prime Day in July, back-to-school season in September and Western Labor Day, Halloween in October, Thanksgiving in November, Christmas and New Years in December. The vacancy time is only 1, 2, 3, 4, 6, 8 for six months;
2. The goal of normal operation is to use all means (compliance methods) to increase the BSR of the product to within 100 of the current class, the higher the better.This will make it easier to promote during the festive season
3. The maintenance of ACoS in the usual advertising operation is still important, but don’t forget to improve the BSR ranking and natural orders because of it;
4. On-site activities are the main source of orders in the festival season, and the reliance on advertising in the festival season is likely to lead to a substantial increase in ACoS;
5. You can usually use a lower price to improve the BSR ranking of your product, but don’t sacrifice profits in exchange for Amazon’s sales during the holiday season
Part 6: Amazon announces start to drastically reduce private label brands
Another question that everyone asked Hui.com after this Prime Day was the continuous increase in the number of Amazon's own brands in the top 100 products in many categories.
In response to a series of issues such as Amazon's VC, private brands, and our brand plan that form unfair competition for third-party sellers, Amazon also gave a clear answer after this Prime Day – Amazon will plan to completely withdraw from its own brand business. .
The Wall Street Journal reported last week on Amazon's move because of disappointing sales of many products. However, Huiwang believes that the reason behind it should be largely due to the impending consideration of the S. 2992 antitrust bill drafted by the US Congress against Amazon. We gave you a detailed introduction to this bill in an article last month, and you can also see the review process of this bill through the following link:
Although the bill is still under consideration, we can see that it has shown enough shock to Amazon. From now on, you should not worry too much about the unfair competition and erosion of Amazon's own brand for third-party sellers' rights and market.
I hope today's sharing can help you make some conclusions about this summer's Prime Day, and I also hope that this fall's Prime Day can bring our members to a higher level!