Tag: promotional insights

  • U.S. Prime Day Deals 2022: Promotion Intelligence First Look

    U.S. Prime Day Deals 2022: Promotion Intelligence First Look

    As inflation hits another 40-year high at 9.1 percent, U.S. consumers geared up for their first sign of hope and relief in the form of anticipated discount buys – 2022 Amazon Prime Days, or so we thought. While Prime Days have grown to become a promotional period almost as important as Black Friday to digital shoppers, the combination of economic uncertainty, inflationary pressures, and supply chain challenges seemed to alter the discount strategy expected given activity seen during 2021 Prime Days.

    Our analyst team has been hard at work aiming to provide a ‘first look’ at 2022 Prime Day Promotional Insights, tracking discounts offered across 46,000+ SKUs within key categories like Electronics, Clothing, Health & Beauty and Home, on seven major retailer websites – Amazon, Target, Best Buy, Sephora, Ulta, Lowe’s and Home Depot. Our analysis compares prices seen during Amazon Prime Day 2022 on July 12th, to pre-Prime Day maximum value prices seen in the ten days leading up to Prime Days, to determine the average change in discounts offered during the promotional period. Below is a summary of our findings.

    Competitive Promotions Give Amazon a Run for their Money

    Amazon offered the greatest average discount enhancements for Electronics at 5.6 percent followed by Health & Beauty items at 5.1 percent, and Home products at 4.2 percent versus pre-Prime Day discounts seen across the categories considered within our analysis. The only category reviewed where average discounts were greater on a competitor’s website was on Target.com within the Clothing category. As seen below, Clothing on Target.com average discounts were 6.8 percent greater than pre-Prime Day offers, which was 2.6 percent higher than the average discounts offered for Clothing on Amazon.

    Target Capitalizes on Growth Opportunity in Clothing Category

    Diving deeper into the details of where Target won within the Clothing category, you can see a majority of their promotional activity took place within Women’s Accessories where discounts offered were 18.5 percent greater than those seen pre-Prime Day 2022, which was almost 15 percent greater than the discount enhancements seen on Amazon for Women’s Accessories. In fact, Women’s Shoes and Sneakers were the only two categories where the average discounts offered were greater on Amazon than on Target.com.

    Overall, the discounts offered on Target.com within the Clothing category were primarily concentrated within items priced $40 and lower, but what was most interesting is that within the $10 and under price bucket, Target offered average discounts of over 11 percent whereas Amazon increased prices for these items on average by over 9 percent.

    While most of the Clothing available on both Amazon and Target.com during Prime Days 2022 were offered without a price change, the greatest discount percentages tracked were within the range of 10-25 percent off on Amazon whereas Target chose to offer the bulk of their promotions at 25 percent off an up.

    Strategic Promotional Strategies Defined at the Electronics Subcategory Level

    When it comes to the Electronics category on Prime Day, the big question is always who will win the battle of the brands. Below shows the difference in average pricing and promotions discounts offered between products manufactured by Samsung versus Apple across each retailer platform, noting discounts were almost 3 percent greater on average for Apple versus Samsung products on Amazon, and Apple discounts were almost 5 percent greater on Amazon versus than those seen on Target.com.

    Amazon wasn’t going all in on Apple however, as we saw ‘Alexa’ devices (Amazon products) available on Best Buy and Target websites also, but the discounts were almost 4 percent greater on Amazon versus Target and over 7 percent greater than the discounts seen on BestBuy.com.

    While the average discounts offered within the Electronics category were greatest on Amazon (5.6 percent) versus Best Buy (3.9 percent) and Target (3.4 percent) as noted within the first chart of this blog and across brands and technologies considered above, the discounts offered on Amazon were strategically focused between 10-25 percent as seen below.

    Amazon’s Electronics promotions were also targeted at smaller price points, items priced between $20-500, whereas Best Buy and Target offered greater promotions for electronics priced $500 and up than Amazon.

    Below is a snapshot of price buckets tracked for Electronics available on BestBuy.com, highlighting where most of the promotional activity was targeted at products priced $50 and up during Prime Days 2022, with discounts ranging from 10 percent up to greater than 25 percent greater than pre-Prime day prices.

    The standout categories were TVs on Target.com with discounts averaging nearly 12 percent greater than those seen pre-Prime day, and smartphones on BestBuy.com with discounts averaging just over 11 percent greater than those seen pre-Prime Day. The category with the greatest average discount enhancements seen on Amazon during Prime Days 2022 was for Wireless Headphones with an average discount of 8.7 percent.

    Home is Where Amazon’s Heart Was on Prime Day

    Amazon dominated offers within the Home categories, especially for products within mid ($40-100) and higher price ranges (items priced $200-500), with the bulk of the discounts offered between 10-25 percent. There was little to no promotional activity seen across all price points on Lowe’s or Home Depot’s websites within the categories we tracked, and most other competitive offers on Home products were seen on BestBuy.com for products priced from $50-500. Even a subcategory like Tools offered deeper average discounts on Amazon (4.7 percent) than discounts seen on HomeDepot.com (1.1 percent) or Lowes.com (0 percent).

    For Large Appliances, Amazon was the only retailer to off any significant discount across each major subcategory with the greatest average discount being on Ovens at 6 percent, followed by Refrigerators at 4 percent. One caveat with this category, when we reviewed Large Appliance prices two weeks prior to Prime Days, we saw average price increases around 16.7 percent occurring on Amazon.

    During Prime Days 2022 however, Amazon also offered top average discounts for small appliances, except for on Instant Pots which appeared to have greater average discounts on Target.com (5.9 percent versus 4.2 percent on Amazon), and Vacuum Cleaners which appeared to have the best promotion of appliances small and large at 13.8 percent average discount on BestBuy.com. Another subcategory deeply discounted on BestBuy.com was weighted blankets, which averaged discounts around 18.5 percent versus Amazon’s average discount at only 6.2 percent.

    Health & Beauty Retailer Pricing Strategies Revealed

    Given the importance Health & Beauty Brands placed on Prime Day sales last year, we had anticipated to see more offers, especially within pure-play beauty retail channels, than we did for this booming category.

    Amazon drove most of the Health & Beauty offers seen averaging 5.1% discounts versus other retailers only offering less than 1% on average, but discounts were aimed at a targeted group of SKUs on Amazon, bringing the average discount lower overall. Most of the promotions offered on Amazon fell within mid-range price points ($20-50) and were discounted between 10-25 percent versus pre-Prime Day prices.

    Target.com offered the most comparable discounts to Amazon for Health & Beauty products on average, but their strategy primarily focused on items within the $20 and lower price range with discounts ranging primarily between 10-25 percent.

    More 2022 Prime Day Insights Coming Soon

    We know the significance visibility to critical pricing and promotional insights play in enabling retailers and brands to offer the right discounts to stay competitive, especially during promotional periods like Prime Days. While this blog is intended to provide a ‘sneak peek’ into 2022 Prime Day insights for the U.S. market, we will be providing more extensive, global coverage and will proactively share new insights with the marketplace as they become available throughout the month of July.

    Be sure to also check out our Press page for access to the latest media coverage on Prime Day insights and more. Don’t hesitate to reach out to our team if there is any particular category you are interested in seeing in more detail, or for access to more information on our Commerce Intelligence and Digital Shelf solutions.

  • Valentine’s Day eCommerce Insights

    Valentine’s Day eCommerce Insights

    Access to these types of real-time digital marketplace insights can enable retailers and brands to make strategic decisions and help drive profitable growth in an intensifying competitive environment. Be sure to reach out to our Retail Analytics experts for access to more details regarding the above analysis.         

  • 2021 Cost-Push Inflationary Trends Ran Rampant, Impacting Holiday Discounts

    2021 Cost-Push Inflationary Trends Ran Rampant, Impacting Holiday Discounts

    Business has been anything but usual this holiday season, especially in the digital retail world. The holiday hustle and bustle historically seen in stores was once again occurring online, but not as anticipated given the current strength of consumer demand and the reemergence of COVID-19 limiting in-store traffic. While ‘Cyber Weekend’, Thanksgiving through Cyber Monday, continues to further its importance to retailers and brands, this year’s performance fell short of expectation due to product shortages and earlier promotions that pulled forward holiday demand.

    Holiday promotions were seen beginning as early as October in order to compete with 2020 Prime Day sales, but discounting, pricing and availability took an opposite direction from usual. This shift influenced our team to get a jump start on our 2021 digital holiday analysis to assess how drastic the changes were versus 2020 activity, and to understand how much of this change has been influenced by inflationary pressures and product scarcity.

    Scarcity Becomes a Reality

    Our initial analysis started by reviewing year-over-year product availability and pricing changes from January through September 2021, leading up to the holiday season, as detailed in our 2021 Cyber Weekend Preliminary Insights blog. We reviewed popular holiday categories like apparel, electronics, and toys, to have a broad sense of notable trends seen consistently throughout various, applicable marketplaces. What we found was a consistent decline in product availability over the last six months compared to last year, alongside an increase in prices.

    Although retailers significantly improved stock availability in November and early December 2021, even digital commerce giants like Amazon and Target were challenged to maintain consistent product availability on their website as seen below. While small in magnitude, there is also a declining trend occurring again closer toward the end of our analysis period, post Cyber Weekend, across all websites included in our analysis.

    Inventory Availability 2021 Holidays
    Source: Commerce Intelligence – Product Availability insights for Home & Garden, Jewelry & Watches, Clothing & Shoes, Bed N Bath, Lighting & Ceiling Fans categories

    Greater Discounts, Higher Prices?

    With inflation at a thirty-nine year high, retailers and manufacturers have realized they can command higher prices without impacting demand as consumers have shown their willingness to pay the price, especially when threatened by product scarcity. Our assessment is that while some products and categories have responded drastically, manufacturers’ suggested retail prices (MSRPs) have increased nearly seven percent on average from January to December 2021. MSRP adjustments are not taken lightly either, as this is an indication increased prices will be part of a longer-term shift in product strategy.

    2021 MoM Retail Inflation Tracker
    Source: Commerce Intelligence – Pricing Insights for Bed & Bath, Electronics, Furniture, Healthy & Beauty, and Fashion categories on Amazon.com & Target.com each month in 2021 comparing price increases from January 2021 base

    Our 2021 pre-Cyber Weekend analysis reviewed MSRP changes for select categories (Bed & Bath, Electronics, Furniture, Healthy & Beauty, and Fashion) on Amazon and Target.com, and found around forty-eight percent of products on Amazon and thirty-five percent of products on Target.com have increased their MSRPs year-over-year, but kept pre-holiday discount percentages the same.

    Looking more specifically as to what year-over-year changes occurred on Black Friday in 2021, we observed MSRPs increasing across the board for all categories at various magnitudes. This indicates why 2021 discounts appeared to be greater than or equivalent to 2020 for many categories, when in reality consumers paid a higher price than they would have in 2020 for the same items.

    2021 Black Friday MSRP Increases
    Source: Commerce Intelligence – MSRP Pricing Insights for Bed & Bath, Electronics, Furniture, Healthy & Beauty, and Fashion categories on Black Friday November 27th, 2021, versus average MSRP pricing for the same SKU count from November 20-26th 2021

    On Amazon.com, categories like health & beauty have already increase MSRPs by a much greater percentage and magnitude versus Target.com leading up to and during Black Friday 2021, while other categories like furniture have increased MSRPs evenly on average across both retail websites. The below chart cites a few specific examples of year-over-year SKU-level MSRP, promotional price, and discount changes within found within the electronics, furniture, fashion, and health & beauty categories.

    Black Friday 2021 vs. 2020 SKU-level Price Changes
    Source: Commerce Intelligence – MSRP Pricing Insights for Bed & Bath, Electronics, Furniture, Healthy & Beauty, and Fashion categories on Black Friday November 27th, 2021, versus average MSRP pricing for the same SKUs on Black Friday November 26th, 2020.

    Fewer, but Deeper Discounts

    From October through early November 2021, fewer products were discounted compared to this same period in 2020, and the few that were saw much deeper discounts apart from the home improvement category. The most extreme example we saw in discounts offered was within furniture where only three percent of SKUs were on discount in 2021 compared to twenty-six percent in 2020. Interestingly, the magnitude of discount was also higher pre-Cyber Weekend 2021 versus 2020, but this trend was not exclusive to furniture and was also seen within electronics, health & beauty, and home improvement.

    Pre-Black Friday 2021 and 2020 SKUs on Discount and Magnitude
    Source: Commerce Intelligence – Pricing Insights for Bed & Bath, Electronics, Furniture, Healthy & Beauty, and Fashion categories on Amazon.com & Target.com Pre-Black Friday average selling price during November 20-26th 2021 versus average selling price from November 13-19th 2021 compared to Pre-Black Friday average selling price during November 19-25th 2020 versus average selling price from November 12-18th, 2020.

    Within the furniture category, the subcategories offering the greatest number of SKUs with price decreases on Black Friday 2021 were rugs by a wide margin, followed by cabinets, bed and bath, and entertainment units, but the magnitude of discounts offered were all under twenty percent.

    2021 Black Friday Furniture Category Price Decreases
    Source: Commerce Intelligence – Pricing Insights for Bed & Bath, Electronics, Furniture, Healthy & Beauty, and Fashion categories on Amazon.com and Target.com on Black Friday November 27th, 2021, versus average pricing for the same SKUs from Pre-Black Friday November 20-26th 2021 and Black Friday November 26th, 2020, versus average pricing for the same SKUs from Pre-Black Friday November 19th-25th 2020

    Accounting for this phenomenon could have been retailers’ attempts to clear inventory for SKUs which hadn’t sold even during the period of severe supply chain shortages. With more products selling at higher prices this year, retailers were also able to use fewer SKUs with greater discounts to attract buyer in hopes of filling their digital baskets with more full-priced goods, helping to protect margins heading in to Cyber Weekend. Scarcity threats also encouraged consumers to buy early, even when not on promotion, to ensure they would have gifts in time for the holidays.

    The same trends seen pre-Cyber Weekend 2021 were also seen on Black Friday with a year-over-year decrease in the percentage of SKUs offered on discount versus 2020, and steeper price reductions for the discounted products which can also be attributed to the increase in MSRPs.

    Black Friday 2021 and 2020 SKUs on Discount and Magnitude
    Source: Commerce Intelligence – Pricing Insights for Bed & Bath, Electronics, Furniture, Healthy & Beauty, and Fashion categories on Amazon.com and Target.com on Black Friday November 27th, 2021, versus average pricing for the same SKUs from Pre-Black Friday November 20-26th 2021 and Black Friday November 26th, 2020, versus average pricing for the same SKUs from Pre-Black Friday November 19th-25th 2020

    2021 Black Friday Price Increases?

    We all know Black Friday is all about price reductions, discounts and deals and so it’s rare to see actual price increases, yet for Black Friday 2021, trends ran counter to this. We observed price increases across all categories for around thirteen to nineteen percent of SKUs, with an average price increase of around fifteen percent in 2021 versus an average of only two percent in 2020.

    SKUs with Price Increases Black Friday 2021 and 2020
    Source: Commerce Intelligence – Pricing Insights for Bed & Bath, Electronics, Furniture, Healthy & Beauty, and Fashion categories on Amazon.com and Target.com on Black Friday November 27th, 2021, versus pricing for the same SKUs from Pre-Black Friday November 20-26th 2021 and Black Friday November 26th, 2020, versus average pricing for the same SKUs from Pre-Black Friday November 19th-25th 2020

    At an account level, we noticed a few interesting differences happening on Black Friday 2021 versus 2020 regarding category price changes. On Target.com, almost ninety percent of the bed and bath SKUs analyzed had a price change on Black Friday in 2021 versus 2020 with eighty-two percent presenting a higher price year-over-year versus only around seven percent showing a decrease, where on Amazon nearly forty-four percent of bed and bath SKUs showed an increase in price and around thirty-eight percent showed a decrease. Except for the health and beauty category on Target.com, more than half of the SKUs in each category saw a price increase on Black Friday versus a price decrease.

    2021 YoY Price Changes on Black Friday
    Source: Commerce Intelligence – Pricing Insights for Bed & Bath, Electronics, Furniture, Healthy & Beauty, and Fashion categories on Amazon.com and Target.com on Black Friday November 27th, 2021, versus average pricing for the same SKUs on Black Friday November 26th, 2020.

    The magnitude of year-over-year price changes seen on Black Friday 2021 was significant across all categories, but the magnitude of price increases found on Amazon.com within the health and beauty category outpaced the rest by far. We reviewed three hundred and sixty-five SKUs on Amazon.com within the health & beauty category and saw almost eighty-three percent of them had a price change with around thirty-one percent decreasing prices and around fifty-two percent increasing prices. This means that within the health & beauty category on Amazon.com, more than fifty percent of the SKUs tracked were sold at a one hundred and seventy-six percent higher price on average during Black Friday 2021 versus 2020.

    Magnitude of Black Friday 2021 Price Increases
    Source: Commerce Intelligence – Pricing Insights for Bed & Bath, Electronics, Furniture, Healthy & Beauty, and Fashion categories on Amazon.com and Target.com on Black Friday November 27th, 2021, versus average pricing for the same SKUs on Black Friday November 26th, 2020.

    The subcategories offering the greatest number of SKUs with price increases on Black Friday 2021 were cameras, followed by men’s fragrances, laptops, and desktops & accessories, but the magnitude of discounts offered were all under ten percent.

    2021 Subcategories with Price Increases during Black Friday
    Source: Commerce Intelligence – Pricing Insights for Bed & Bath, Electronics, Furniture, Healthy & Beauty, and Fashion categories on Amazon.com and Target.com on Black Friday November 27th, 2021, versus pricing for the same SKUs from Pre-Black Friday November 20-26th 2021 and Black Friday November 26th, 2020, versus average pricing for the same SKUs from Pre-Black Friday November 19th-25th 2020

    The Aftermath Post-2021 Cyber Weekend

    Extending this analysis beyond the holiday weekend, we analyzed price change activity from December third through the ninth across the top US retailers (chart below) and found that price decreases have been very minimal, comparatively speaking. Though there was a spike in number of price decreases from December 8th to the 9th, the percentage of SKUs with price decreases was still very low (less than three percent). We anticipate this trend will continue into 2022.

    SKUs with Price Decrease Post Cyber Weekend 2021
    Source: Commerce Intelligence – Pricing insights for Home & Garden, Jewelry & Watches, Clothing & Shoes, Bed N Bath, Lighting & Ceiling Fans categories

    A Sign of Things to Come

    A confluence of inflationary trends, product shortages and consumer liquidity have driven many marketplace changes to occur simultaneously. Government programs in the form of stimulus checks, have put extra money in consumers’ hands, and so they’ve been more willing to spend. That, coupled with the shock in the supply chain, has motivated people to buy far ahead of the 2021 holiday season. Hence, retailers have needed to rely much less on across-the-board discounts. Promotions have been more strategic – we’ve seen deeper discounts over fewer products, likely used to draw consumers in to buy certain items, and once they’re there, customers are buying everything else at a non-discount level. When these factors once again normalize, we could see a return to the “race to the bottom” that has occurred since the financial crisis of 2008-2009, but for once, retailers may be able to maintain some pricing power as the 2021 holiday shopping season played out.

    Even though performance was not as anticipated and holiday sales did not grow as rapidly as they did in 2020, Cyber Monday was still the greatest online shopping day in 2021. Through it all, retailers managed to keep their digital shelves stocked and orders filled in time for the holidays for the most part, running the risk of housing aged inventory if goods didn’t arrive in time. Despite predictions for steep promotions in January 2022, with supply chains still challenged and inflationary pressures still full steam ahead, we don’t anticipate much in the way of enhanced discounts to continue beyond the holidays.

    Access to these types of real-time digital marketplace insights can enable retailers and brands to make strategic decisions like how and when to address inflationary pressures, while also supporting many other day-to-day operations and help drive profitable growth in an intensifying competitive environment. Continue to follow us in the coming weeks for a detailed 2021 year-end review across more retailers and categories. Be sure to reach out to our Retail Analytics experts for access to more details regarding the above analysis.         

  • Are Your Digital Shelves Prepared for Green Monday?

    Are Your Digital Shelves Prepared for Green Monday?

    Traditionally, retailers have staged multiple promotions between Black Friday and before Christmas Day to keep consumers excited about holiday shopping, so it’s easy to see why one more promotional day might fall into relative obscurity. As if ‘Early Start’ offers to Black Friday and extended ‘Cyber Weekend’ promotions weren’t enough to plan for, eBay added another day into the mix called ‘Green Monday’, much to the benefit of consumers, as it furthers the window of opportunity to secure a bargain during the holiday season. 

    Green Monday falls on the second Monday of December and has historically been one of the greatest sales days of the year for eBay, often attracting last-minute shoppers or those searching for last-minute deals. However, because of the 2021 Global Shipping Crisis, there is speculation that Green Monday may be the last chance this year to have items delivered in time for Christmas. For this reason, we believe it could turn into quite a fruitful event for participating retailers if it encourages procrastinating shoppers that traditionally spend closer to December 25th to buy earlier in the season.

    This isn’t the first year retailers outside of eBay have offered Green Monday promotions, however. Our team has been actively monitoring activity on this day from 2017 through present, to not only assess which retailers participate in the event, but also to understand how the discounts may change surrounding the event. The categories monitored include Apparel (Clothing, Shoes & Jewelry), Bed and Bath, and Home and Garden, and we’ve identified products offered on discount by comparing each applicable product’s price on Green Monday versus the most commonly seen price for the product offered throughout the month of December.

    Better Promotions Than Boxing Day

    Taking a closer look at 2020 Green Monday discounts within the categories and retailers analyzed, apart from Wayfair.com, we see all offered more SKUs on discount on Green Monday versus the days leading up to and out of the event. Kohls.com led the pack with around 93% of SKUs offered on discount, followed by Macys.com with 95%, and Wayfair.com with 83%. Overall, the number of SKUs on discount on Green Monday were greater than the SKUs offered on discount on Boxing Day, which is traditionally known as a great day to bargain shop.

    Source: DataWeave Commerce Intelligence – Promotional Insights tracking Apparel, Bed & Bath, and Home & Garden category product’s online price on Green Monday 2020 in the US versus regular prices for the same products in the month of December each year.

    What’s in Store for Green Monday 2021?

    The insights we’ve tracked over the last four years have not indicated any signs to an end for Green Monday any time soon. As we see it, for consumers it is an extremely convenient time to order holiday gifts, and for retailers it is a good time to build brand trust and loyalty by fulfilling last minute orders at a great value, in time for the holidays.

    Our prediction for the categories analyzed is to expect to see more retailers participate in Green Monday 2021 to a greater degree (more SKUs on sale and enhanced promotions). For retailers in this analysis, we would anticipate HomeDepot.com to enhance the number of offers to match 2020 competitive activity, and for Wayfair.com to look at increasing the number of offers on Green Monday versus the period leading into the event.

    If you are interested in learning more about the details behind this analysis or our Promotional Insights solution, be sure to contact us. We can help you evaluate the effectiveness of your holiday promotional spend with access to near real-time marketplace insights on the brands, categories, and products your rivals promote, including discounts, campaign frequency and duration and more.