Up to 100% increase! Will sellers suffer heavy losses during Prime Day this year?

For sellers, the focus recently is Amazon's Prime Day .

Data intelligence company Similarweb predicts that Amazon's Prime Day this time will break last year's record and become the highest-selling Prime Day in Amazon's history. This year's sales will increase by more than 14% year-on-year to $14.7 billion from $13 billion last year. Similarweb also believes that under the influence of inflation, American consumers are more concerned about affordability than ever before, and these consumers will further promote this sales event.

Skai data also shows that more than two-thirds of American consumers plan to participate in this year's Prime Day, which also reflects consumers' attitudes towards this big promotion.

Although various surveys show that Prime Day has a bright future, Amazon's various operations are quite speechless: misjudgment of listings, sensitive word checks, sellers' order volume decline, and multiple warehouses bursting. In addition to these, there are some foreseeable expenses, and sellers have responded in an endless stream, such as "losing money to gain publicity" and "all losing money".

What’s even more worrying is that this year’s Prime Day sellers may have to spend more on advertising costs.

In a recent notice sent by Amazon to sellers, there is such a message: In order to help advertisers gain exposure and sales during Prime Day, the platform will temporarily adjust the increase in floating bids for "remaining part of search" and "product page position" to a maximum of 100% (currently 50%) .

The rules apply to: 1. Sponsored product activities using "dynamic bidding - up and down"; 2. Ads that appear in the "rest of the search" or "product page position"; 3. After Prime Day ends, the dynamic bidding fluctuations for "rest of the search" and "product page position" will be restored to 50%.

That is to say, if the seller's basic bid is $1.00, during Prime Day, the system can increase the bid to a maximum of $2.00 as long as the above three situations occur.

Every seller hopes to get exposure and premium positions in the promotion. Once this notice is released, sellers who want better traffic will have to become more "competitive". How to compete? It seems that there is no other way except to increase the "pay-to-win" efforts. This move by Amazon not only makes this year's "traffic war" more intense, but also makes sellers' advertising budgets this year "precarious".

According to this trend, even if Prime Day sales really reach $14.7 billion or more, it is still unknown what will happen to the sellers’ income. Among the three parties, buyers spend money to buy things, Amazon’s new performance record has made a wave of presence, and the only ones who are hurt are the sellers.

In addition, major platforms such as Walmart and Target have also launched their own promotions, which overlap with Amazon in both start time and duration. Therefore, even though more than two-thirds of American consumers and 40% of American households plan to spend during Prime Day, it is still unknown how much of their budget will be spent on Amazon.

This concern is not unfounded. A survey by market research firm Numerato shows that 74% of American consumers will think of Walmart during holiday promotions (an increase of 25% compared to non-promotional periods), 58% will think of Target (an increase of 19% compared to non-promotional periods), and 70% will think of Amazon (a decrease of 9% compared to non-promotional periods).

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