Using Promotions to Drive Traffic and Increase Conversions
Customers love a promotion. They like to feel they are getting a special deal and not paying full price. Promotions can help increase traffic, conversion, basket size and, ultimately, sales. Within the Seller Central dashboard, Amazon sellers have the ability to set up a variety of promotions to enhance the customer shopping experience and increase sales. The type of promotion a merchant decides to use depends on their goal, budget, audience, type of product and stage within the product life-cycle and the time period they wish to run the promotion for.
Below is a list of the different types of promotions available in Seller Central. One thing you need to be aware of is that not all promotions are available to all sellers. There are some promotions only available to those that have brands enrolled in the Brand Registry or that meet certain parameters.
Social Media Promo Code
This is a relatively new promotion and is currently only available to brands enrolled in the Brand Registry. It is a percentage-off promotion that focuses on driving external traffic to the Amazon marketplace from social media channels and other external marketing activities. When setting up the promotion, Amazon.com, Inc. ("Amazon") provides the brand with a separate marketing page and a link for them to share with their audience. It is not visible directly on the product detail page; a customer can only see this promotion if they click on the specific link. After clicking on the link the customer will be able to see the product and offer. If they add the item to cart from that page, the discount will be automatically applied. Social media promo codes only last for 30 days and the discount must be at least 15%.
This is a great promotion to drive external traffic to the Amazon marketplace, particularly for new product launches. For brands with a large following on social media, this promotion has the opportunity to dramatically boost sales. Brands can also share this link in customer emails, especially if their email database is a lot stronger than their social media following.
By having an offer specific to an external audience, the merchant can track the sales uplift and get an understanding of how well these type of promotions work on social media. Prior to the introduction of this promo code, sellers had no way of tracking sales that came from social media.
Merchants may want to incentivize customers to increase their basket size and purchase quantity. With percentage-off promotions, sellers can set up offers with a tiered discount structure: the more they buy, the higher level of discount they get. The discounts can apply to a single item or across multiple items e.g. buy 3 units of X and get a 10% discount off of your total order or buy 1 unit of X and get a 20% discount off of Y. If the promotion is across multiple items, it is important the seller ensures the promotional messaging on the product page highlights this and that the offer is clear to the customer for it to be successful and to avoid any customer confusion.
The only downfall with this promotion is that it does not boost traffic as these offers are only visible once the customer goes to the product page. It focuses on encouraging buyers to purchase more and helps with conversion. Despite this, this promotion is very popular among sellers, particularly on items with low retail price points or those items that make sense to purchase in volume.
Buy One, Get a Gift
Another great promotion idea is to give away a lesser-value product for free if a customer purchases a particular product. This can work well with new product launches (buy a running watch and get a free bandana) or items with surplus stock (buy two packs of coffee and get one free). This promotion works similarly to the percentage-off promo with a focus on increasing basket size and conversion as opposed to helping drive traffic.
The Amazon Giveaway program allows a seller gives a product away as a freebie as part of a sweepstakes. There is no fee to take part in this promotion; however, the merchant must provide the item free of charge and pay for the cost of shipping the product to the winner. This is a good way to increase product awareness, especially on new products, and to reach new customers. It drives customer engagement and gives the product and brand exposure on the Amazon marketplace and in social media, which can increase traffic and sales.
To participate, all a seller needs to do is decide on the item they wish to give away, how they would like to give the item away and what action the entrant should take to have a chance at winning the giveaway. The merchant can give the item away as a sweepstakes, random instant win, a lucky number instant win or on a first-come first-served basis. They can then decide if they want the entrant to take part in a little task (follow an author, follow someone on Twitter, Tweet a message, watch a video short, watch a YouTube video or answer a poll. Alternatively, the seller does not need to request the entrant do anything but can still be included in the giveaway. Once the offer is set up, the merchant can then share the giveaway with their customers or share it publicly and promote it via Amazon’s Today’s Giveaways email subscription program.
Coupons are effectively another percentage-off promotion and work especially well with new products where a brand is looking to create product awareness. The main difference is that coupons get greater visibility outside of the product detail page, helping to improve conversions and increase traffic. The coupons are hassle free, as the customer doesn’t need to type in any code to redeem the discount. They just click on the coupon and add the product to cart; savings will automatically be applied at checkout. Coupons are one of the best promotions for visibility so long as the seller is winning the Buy Box. The products will appear on Amazon’s Goldbox page, the coupons page, search results page and product detail page.
Coupons can be provided in the form of a percentage off or money savings. The minimum discount can be as low as 5%, although it is always recommended to give a stronger level of discount to see a greater sales uplift. They can also run up to three months. When setting up a coupon, the merchant can select a total budget they are willing to spend for each SKU or for all items and can edit this even when the promotion is running. Sellers will need to pay a fee of $0.60 for every redemption as well as fund the discount; this fee is included in the budget. They also have the ability to edit the text that is visible on the coupons to help entice the customer and can target the audience the coupons are available to, such as customers who viewed or purchased certain ASINs. This promotion unfortunately is not available to all sellers; certain metrics and parameters need to be met in order to have access.
Lightning Deals are flash sales, featured for up to six hours on the Amazon Deals page, one of the most visited pages on the Amazon website. This is a great way to boost sales within a limited amount of time. Lightning Deals work well with overstocks and discontinued inventory, or when a seller is looking for a boost in sales. There is a fee to participate in the event, which varies according to the time of year. Sellers can only take part if Amazon has recommended the products as Lightning Deals. There are certain parameters and metrics that items must meet in order for Amazon to consider recommending the products. These can include factors such as review ratings, sales volume and seller performance metrics. If Amazon has recommended a Lightning Deal, they will also give the merchant a recommended price and quantity that the seller needs to agree to if they want to participate.
Unfortunately, the date the promotion goes live is not always visible to the seller when the promotion is set up and the seller might only be informed days before. The merchant cannot select the date or time and therefore sometimes the success of the promotion is out their hands; a deal that goes live at 8am vs 8pm may have completely different results with evenings and lunchtimes being peak times for traffic.
Overall, for any type of promotion to be successful, the seller must ensure they are offering a good product at an attractive price. Selling a product with only 1 star reviews at a 5% discount will not drive incremental sales. A top selling product with a discount over 20% is what sellers should be aiming for if they want to see a significant sales uplift.
Have you tried any of these promotions? Did you learn of any new strategies you'd like to try? Tell me about it in the comments!
Originally published on February 27, 2018, updated July 7, 2019
This post is accurate as of the date of publication. Some features and information may have changed due to product updates or Amazon policy changes.