2021 amazon strategies: how leading brands and retailers

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2021 Amazon Strategies: How Leading Brands and Retailers Are Preparing for Holiday Success

Dani NadelPresident & Chief Operating Officer

Andrew AltersohnGeneral Manager, Enterprise Brands

Agenda

● Review factors influencing the 2021 holiday season

● Feedvisor’s projections for Q4 growth on Amazon and e-marketplaces

● Key factors and tips for brands and retailers to consider when preparing Q4 strategies

The 2021 Amazon Holiday Season Will Be BIG!

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Q4 2020 Was a Breakout Quarter for E-Commerce

● Amazon’s Q4 2020 sales increased 42% YoY to $125.6 billion (Amazon)

● 71% of brands on Amazon saw e-commerce sales increase up to 30% or more last year(Feedvisor Survey)

● Feedvisor customers experienced 43% growth in Q4 vs. pre-Covid benchmarks

● Already in Q1 of 2021, Amazon saw 41% YoY growth in net sales, up $109 billion

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Q4 2021 Could Be Even Bigger, 48%+ vs. Q1 2021

● As compared to Q1 2021, Q4 2021 could grow 48.5%, assuming existing market conditions

● But if retail becomes restricted, then we could see a range as high as 58.5% vs. Q1

58.5%

● Already in Q1 of 2021, Amazon saw 41% YoY growth in net sales, up $109 billion

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Looking at YoY, Q4 2021 Could Be 35%+ vs. Q4 2020

● Projected Q4 YoY of 25%–32.5%, assuming existing market conditions

● But if retail becomes restricted, then we could see a range as high as 35%–40%

How Should You Prepare?

Start Planning Early… Now!

Tip #1

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Start Now! Planning to Win Takes Time and Focus

● Build your game plan: Establish priority products and deals, sales targets, and budgets

● Inform your holiday strategy with Prime Day 2021 and Q4 2020 learnings

● Prepare your pricing and promotions: Test pricing and start running promos to learn ○ Lean on a combination of tactics, including coupons, Deals, BOGOs, etc. ○ Gain insight into how price and promotions impact sales and margins

● Prepare your content: Start optimizing your product detail pages and strategies well before the holiday season starts in order to maximize visibility, conversions, and product ranking

● Prepare your campaign budgets and KPIs:○ Expect higher CPCs and bids to compete ○ Craft catalog and product-level goals for Q4○ Develop performance/scenario analyses to inform advertising budgets for Q4

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Build (and Work Through) Your Planning Checklist

Paid Media

Off-Amazon Drivers

Organic Search

Brand Store - Content/UX

PDP - Content / A+

Ratings & Reviews

Price & Promotions

Inventory & Availability

Amazon Retail Programs

Visibility

“Power” KPIs Revenue & Share

Conversion

Paid SOV

Organic Rank & SOV

Lost Buy Box (LBB)

Price

Catalog Management

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Build (and Work Through) Your Planning Checklist

Paid Media

Off-Amazon Drivers

Organic Search


PDP - Content / A+

Ratings & Reviews

Price & Promotions



Catalog Management

✓

✓

✓

✓

✓

✓

✓

✓

✓

✓

Inventory: You Can’t Sell If You Don’t Have Product

Tip #2

● Understand expected holiday demand based on prior years and/or add a 20% increase for non-seasonal items

● Ensure inventory arrives to Amazon weeks in advance

○ Get ready now to mitigate delays caused by rising shipping container costs and ongoing Amazon supply chain issues

● Prioritize importing your best-selling products

● Have a contingency plan

Anticipate Supply Chain Issues

● Conduct portfolio analysis to understand top-performing products based on sales/margins

● Check IPI Score and ensure it is above threshold

● Clean up poor-performing inventory (and LTSF) ○ Potentially pause low-margin items and in-stock more than 365 days

Analyze, Project, and Prepare for Increased Demand

Price/Promotion: You Won’t Sell If You Don’t Have The Deals

Tip #3

Holiday success will be a result of your ability to drive conversions via smart price/promotion strategy

Need “Smart” Price / Promotion Strategy

Paid Media

Off-Amazon Drivers

Organic Search


PDP - Content / A+

Ratings & Reviews

Price & Promotions



Visibility


Conversion

Paid SOV

Organic Rank & SOV

Lost BuyBox (LBB)

Price

Catalog Management

● Competition on Amazon is fierce and only getting more so

● Availability + Deals = Win!

● Outpacing competitors requires “smartly” priced promotions, crafted by ASIN strategy

○ Brand Awareness○ New Product Launch○ Profit Maximization○ Liquidation

● Promotions and pricing only work when you have the inventory to support demand

● Promotions and pricing only work when you know your fully loaded costs by ASIN on Amazon, and have the margins to support the deals

Deals, Deals, Deals

Tip #4

Discoverability: You Need to Be Found to Be Bought

Holiday success will be a result of your ability to drive visibility and discoverability

Need “Smart” Discoverability Strategy

Paid Media

Off-Amazon Drivers

Organic Search


PDP - Content / A+

Ratings & Reviews

Price & Promotions



Visibility


Conversion

Paid SOV

Organic Rank & SOV

Lost BuyBox (LBB)

Price

Catalog Management

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Advertising Is Core to Discoverability

● 88%+ of brands advertise on Amazon (Feedvisor)

● Brands are strategically investing, with 29% advertising more during Q4 holiday season and 16% only advertising during these key periods

● Advertising competition and cost escalation reaching new heights○ Turkey Five 2020: CPCs

28%+, impressions 109%+○ Prime Day 2021: CPCs

29%+, impressions 33%+

● Be prepared to pay to play!

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Plan a Full-Funnel Discoverability StrategyReaching shoppers across every stage of the funnel is the key to outpacing competitors who are vying for the same audience and search terms

● Utilize the Amazon DSP to target new-to-brand prospects in the upper- and mid-funnel that are in the interest or consideration mode

● Optimize Sponsored Ads so your brand dominates for your own branded search terms and can efficiently intercept shoppers who are browsing category or competitor terms

● Expect intense conquesting as you optimize strategies for improving these key metrics

Awareness/Engagement

Consideration

Purchase

Plan How to Engage at Each Stage of the Funnel


Consideration

Purchase


Consideration

Purchase


Consideration

Purchase

● Understand and plan for where customers are in their shopping journeys

○ Ready to purchase? Researching? New to brand?○ What is the action or next step you want them to take?○ Should you taken them to a PDP or Brand Store?

● Utilize creative and targeting strategically to connect to shoppers

○ Dynamic vs. custom creative○ Product vs. lifestyle targeting○ Deal vs. general brand message vs. seasonally themed

● Use this time to build retargeting pools to activate when you are running best promos/have inventory

● Use this time to test and learn across creative and targeting

Build & Maintain Momentum Through the Pre & Holiday Season

Tip #5

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“Holiday” Season Always Starts Earlier and Earlier

● During the 2020 holiday shopping season, 38% of US shoppers said they would start their shopping in October, and 60% said they would start before December

● Prime Day 2021 moving from October to June should have an impact on event performance

○ Lacking the holiday season push, GMV up just 7% (or less depending on the source) after growing 54% the year prior (Bank of America)

● Without an e-commerce event scheduled in October, Q4 holiday will be the main event

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Plan the Holidays As an Extended Multi-Phase Event

Phase 1: Lead In (November)

Phase 2: Turkey 5 (Thanksgiving - Cyber Monday)

Phase 3: Lead-Out(December)

● Build campaigns 2-4 weeks before the Turkey Five

● Optimize strategies; test new channels and promotions

● Be Retail Ready

● Discount Select Secondary items to kick start engagement

● Invest to Be Visible

● Go big and bold with your most attractive promotions and discounts

● Be Agile: react to inventory levels, competition, consumers

● Focus messaging on last-minute holiday gift giving

● Prioritize efficiency

● Liquidate excess inventory

● Build momentum ● Maintain momentum evolving messaging, promotions, and investment levels ● Remain agile

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Plan the Holidays As an Extended Multi-Phase Event

Ideally create “Always on” campaigns with targeted peak efforts

Phase 1: Lead In (November)

Phase 2: Turkey 5 (Thanksgiving - Cyber Monday)

Phase 3: Lead-Out(December)

Medium Heavy Up Modest

● Prospecting● Retargeting● OTT / Video

● Retargeting ● Retargeting

● Category Depth● SBV

● Brand Ownership and Conquesting

● Category Depth

● Brand Ownership and Conquesting

Sponsored Ads:

DSP

Investment

Take a Holistic View

Tip #6

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Holistically Optimize Amazon for Q4 and Beyond

● Advertising, promotion/pricing strategies, and inventory must be in alignment for optimal performance

● Understand your overall P&L across your catalogue

○ What is your per product margin?○ What are you willing to spend on customer

acquisition?

How to Prepare for the 2021 Holiday Shopping Season1. Start Planning Early! Use this time to test and learn

2. Anticipate Inventory and Supply Chain Issues: Get ready now to mitigate delays caused by rising shipping costs and ongoing Amazon supply chain issues

3. Activate Winning Price/Promotions: Outpacing competitors requires smartly priced promotionsas only the “best deals” win the holidays; Commensurate with margins and inventory

4. Discoverability — You Need to Be Found to Be Bought: Deploy Amazon DSP and Sponsored Ads to target consumers at every stage of the funnel, with creative campaigns that resonate

5. Build the Momentum: Define a three-phased approach and remain agile to keep consumer interest up and drive sales

6. Take a Holistic View: These components of your strategy must work in harmony with content, advertising, pricing, promotions, and inventory to drive overall performance

Grow. Sell. Win.

The Highest-Performing Optimization Platform and Full-Service Team, Powered by Proprietary AI, Data, and Deep Amazon Expertise

Advertising. Pricing. Intelligence. Brand Experience.

Let Us Help You Win Q4

Let us help you build and maximize Q4 revenue and market share on Amazon!

64% Increase in Revenues 72% Increase in RoAS 41% Increase in CTR

Q&A

Get in touch with us at feedvisor.com/connect

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Thank You!

Get in touch with us at feedvisor.com/connect

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2021 amazon strategies: how leading brands and retailers

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