These limited-time deals have become a critical part of the company’s Prime Day strategy.
Amazon has Lightning Deals all year, but on Prime Day 2018 it hiked the price for a Lightning Deal to $750 after charging $500 last year and making it free to register the years before that, reports CNBC.
The added cost to feature products helps make Prime Day an advertising treasure trove for Amazon, but it’s also part of how Amazon is shaping shopper behavior.
Users can look up Lightning Deals a day before they go into effect and set alerts on products they’ll want to buy.
This gives the brand a strong reason to advertise to Amazon shoppers leading up to the limited-time offer, but also explicitly reminds people to check upcoming deals and set an alert, said one brand manager with a Prime Day Lightning Deal who said he could not speak publicly due to an agreement with Amazon.
The higher registration costs for Prime Day promotions are also about forcing brands to focus on items they know will sell out and thus weed out some of the unpopular products brands that in the past have forced them into Prime Day consideration through free Lightning Deals, he said.
“Amazon has shown that they’ll happily sacrifice margin to encourage future shopping habits they like,” the brand manager said, “and in this case it’s really about getting people accustomed to checking upcoming deals and registering buys ahead of time.”
Pushing voice shopping
Amazon wants its customers to do more voice-based shopping.
This year, Amazon offered additional Prime Day discounts on consumer electronics and groceries ordered via an Alexa voice-activated device.
“The savings aren't massive on those deals, but it's an amazing way to increase adoption for voice,” said Aaron Levy, Elite SEM’s director of paid search. “That coupled with giant discounts on Amazon devices will likely increase their stranglehold on the shopping aspect of voice.”
Amazon also favors voice shopping by extending the Prime Day window for purchases that will drive adoption of the trend.
Amazon’s own voice-activated devices are available exclusively the day before Prime Day – helping to once again make the Amazon Fire TV stick with Alexa voice remote and the Alexa-based Echo speaker the top-selling Prime Day products. And the special deals on voice orders continued for a day after Prime Day.
Connecting to Whole Foods
This year was Amazon’s first Prime Day owning Whole Foods, and the grocery chain it acquired for $13.7 billion last year figured prominently in its discount and promotions strategy.
As with the Alexa deals, Amazon will sacrifice a small margin on savings if it can drive long-term shopper behavior.
Prime members, for instance, got a $10 credit to their account for Prime Day after spending at least $10 in a Whole Foods store.
Prime members got an extra $10 off and $10 ecommerce credit if they ordered Whole Foods delivery for the first time either online or with an Alexa device, incentivizing shoppers to try a new, Amazon-preferred way to buy groceries.
The bigger the deal Amazon offers, the more important the shopping trend it wants to gain traction. And the biggest Whole Foods benefit on Prime Day – an additional 10% on top of all pre-existing discounts – went to shoppers who connected not just to a Prime account but to an Amazon Prime Rewards Visa credit card, since cardholders provide the ecommerce giant stronger and more consistent data on purchases.