The impact of peak events on consumer purchasing habits
Laura Conboy, June 22, 2023
Consumer shopping behavior changes with the seasons. This can relate to traditional seasonality such as the summer holidays, it can result from consumers trying to get a good deal around peak shopping events, or it can be tied to psychological factors like “new year, new me” trends. In a nutshell, consumers do not purchase at the same rate consistently throughout the year. As an advertiser, an awareness of how consumer shopping dynamics change around peak events can help you maximize the potential of these high-opportunity periods.
The three stages of peak event advertising
If you have a seasonal product you will be very comfortable with the concept of seasonality. Say for example you sell garden furniture. You are more likely to sell higher quantities of your products in the lead up to the spring/summer season when the weather begins to improve, rather than in the cold, wet winter months. That’s not to say that you won’t sell anything in the off-season, but you will certainly notice a dip.
A similar concept can apply to peak shopping events. Consumers may hold back on their spending ahead of Black Friday/Cyber Monday (BFCM) in anticipation of securing a better deal during the peak event itself. Some savvy consumers may begin to shop around before, taking advantage of early deals, but the true influx of frenzied deal-grabbing can usually be seen over the actual days of the peak event.
We can break peak events three different stages:
The lead-up period before the event
The peak of the event itself
The aftermath following the event
In all scenarios, it is important to pivot your advertising strategy in alignment with the way consumers shop during any given period. In this article, we'll be focusing specifically on advertising, and perhaps we can provide some inspiration for things you can consider for 2023's peak events such as Amazon Prime Day, scheduled for July 11th-12th this year, and BFCM, taking place on the weekend of November 24th-27th.
A peak event like Amazon Prime Day may only officially last for 48 hours, but anticipation for the big day can create shifts in consumer behavior as early as several weeks beforehand.
How do shoppers shop prior to peak events and what impact can this have?
In the lead-up to peak events, shoppers may be operating with a browsing mentality, as they look around for deals and potential purchases for when the peak event arrives. This could manifest itself in increased click-through rates (CTR) but without conversions following the same trajectory (lower CVR), as consumers look now with an intent to buy later. This may look like a lot of “add to bags” but not much more movement on the sales front. Some eager consumers, however, may be on the hunt for early deals, and this could be a good time to offer your discounted pricing before advertising gets very expensive.
Cost per click (CPC) tends to creep up in the week(s) preceding peak events, as the marketplace begins to become more competitive with more sellers noting the surge in traffic that is expected during the peak period. There are more than 9.5 million sellers on Amazon globally on a good day, so you can imagine the frenzy that can ensue in many people wanting a slice of the pie during these times! As the event approaches, winning auctions will become both more competitive and more expensive for sellers, but most consumers may continue to hold back as they wait for the best deals to come.
How can I take advantage of the lead-up period with my advertising?
First and foremost, you need to consider if you want to take part in this higher cost time period at all. If you have participated before, review your results from last time—was it worth it? Is it worth doing again?
If you look at last year's results and see that you turned a profit, you'll be keen to get involved in the event. Some things you may want to think about during the lead-up are:
Analyze your ASINs
Identify which of your products are affected by the demand, and look at past data to think about predicted popularity and sales of these products
Look at category benchmarks to get an idea of what to expect spend-wise
Consider early access deals for eager shoppers
Ramp up your spend
Invest in your advertising in the weeks before the peak period to support your organic rank growth
Start to bid higher on your flagship terms to get ahead of the curve. Purchasing strong visibility on strategically important keywords will help you reach increased share-of-voice (SOV) goals
To further maximize your SOV, think about targeting Sponsored Products, Sponsored Brands and even Sponsored Brands video campaigns on those important and relevant search terms
If these terms begin to get too expensive, consider targeting the longer-tail, cheaper terms to increase your SOV for more specific searches
Consider cross-selling and competitor conquesting strategies such as targeting competitor PDPs to increase your SOV
Drive brand awareness
Boost your brand awareness using a variety of ad units such as Sponsored Brands and Sponsored Display
If you can, move even higher up the funnel and be strategic—think about using Amazon DSP to expand your reach off-site
Explore the possibility of influencer marketing and social media to highlight your upcoming peak period deals
Take a look at our recap of Prime Day 2022 to gain some more valuable insights.
While the lead-up period shouldn't be neglected, it's very much the calm before the storm, with the real explosion of activity happening during the peak event itself.
How does shopper behavior change during the peak event?
When the peak event finally arrives, you can expect traffic in the marketplace to increase exponentially. Consumers scramble to get the best deals and make decisions based on their window shopping from the lead-up period. Advertisers who act wisely and can offer deals to these eagle-eyed shoppers can reap heavy rewards from their investments by achieving increased purchases and sales.
However, with the increased traffic comes even more competition. CPCs will shoot up and it will become more expensive to win the most visible placements on key search terms. It can be difficult for advertisers to find the right balance during the craziness.
How can I ensure my ad campaigns take full advantage of the peak event?
During this high-traffic, high-reward period, the most important thing to ensure is that your campaigns don’t go dark:
Ensure your bids and budgets are high enough to stay visible in spite of higher CPCs
Use all ad units to maintain SOV amongst the noise
Similar to the lead-up, if you find flagship search terms are too expensive, consider longer-tail search terms and aim to dominate these
Consider peaks throughout the day and the potential to use dayparting. For example, if you have a fixed budget, think about using it at the most fruitful time. In 2022's Prime Day we saw the highest volume of sales on the morning of day 1
Utilize Sponsored Display ads for brand defense on your own PDPs
Take a look at our strategies and success for more ideas here.
The end of a peak event doesn't trigger an instant return to business as usual, with the post-event environment also offering its own challenges and opportunities.
What happens to consumer behavior after a peak event?
Consumers tend to be more frugal following a peak event, as many of them have obtained the bargains they were looking for either in the lead-up to or during the peak event. There may be some last-minute deal hunters looking for some leftover offers but it is important to be mindful of the expensive nature of placements still impacting your advertising even as conversion rates fall post-event.
Once a peak event finishes, you can expect to see CPCs decline and start to rebalance, but they can still remain higher than usual in the ensuing week or two. Conversion rates will undoubtedly fall from their highs and this can result in wasted expenditure for comparatively little return. In spite of this, it is ill-advised to cut all advertising entirely, as this can have detrimental effects on your organic rankings. You can turn your advertising down, but don't turn it off completely.
How can I take advantage of the post-event period with my advertising?
Post-peak, it is imperative that you assess the results of your advertising and overall performance. This will inform your decision-making for future endeavors and help you adjust your strategies as needed.
Analyze your results: For example, Amazon Stream data can be invaluable in judging performance over the specific hours and days leading up to, during and after the event
Pull back on your advertising: Reduce bids and budgets to avoid overspending at times when conversion rates are low
Maintain some advertising: Stay active to support your organic rankings and not tank your efforts to date!
Conclusion: the importance of timing
All in all, there is a lot to consider when optimizing your advertising across the three stages of the peak period, before, during, and after the event. These considerations can be summarized by the importance of timing. You have to be aware of the specific shifts in consumer behavior at each stage, and keep an eye on your campaigns to ensure you're on top of budgets and you're not going dark.
To help you prepare for this year's peak events, you can take a look at some of our resources to compare category benchmarks and insights into what happened last time!
Prime Day - Q3 2022 Benchmark Report Europe
Prime Day - Q3 2022 Benchmark Report North America
BFCM - Q4 2022 Benchmark Report Europe
BFCM - Q4 2022 Benchmark Report North America
If you have any other questions about peak shopping events, or anything else you'd like to share, don't hesitate to reach out via firstname.lastname@example.org.
To get started or learn more about how Perpetua can help you scale your Amazon Advertising business