The Retailer’s Guide to Prime Day Success: How to Successfully Profit on Amazon’s Biggest Sales Day

Amazon Prime Day – it’s rapidly becoming one of the most profitable shopping days of the year, and may soon rival Black Friday and Cyber Monday in terms of popularity with consumers. Of course, the day itself was pioneered by Amazon as a celebration available only to their Prime subscribers, but does that mean that other retailers are left out in the cold?


Does Amazon Prime Day Benefit Only Amazon-based Retailers?

While Prime Day might have originated with Amazon, it has not remained the online retail giant’s sole property. According to research by RetailMeNot, Inc., 96% of the website traffic on the company’s platform on Amazon Prime Day 2017 was driven not by Amazon, but by other retailers. This is backed up by additional research, which shows that more and more retailers are finding ways to turn Amazon’s day into their own Christmas in July.


How can my business profit off of Amazon Prime Day?

There are plenty of examples of winning strategies here. Some retailers used specific coupons with the words Prime, or Prime Day as the code. Taking an SEO-approach to naming their coupons has helped retailers gain web traffic from customers searching for “Amazon Prime Day Deals.” Other retailers, such as, adopted aggressive price matching policies (and promoted those price matches to their shoppers).


Yet other retailers decided to create their own themed sale that “just happened” to coincide with Prime Day – for instance, JCPenney ran their Penny Palooza with discounts of 25% to 30% off on featured items. Macy’s and Best Buy also got in on that action. Toys-R-Us (who will be missed), offered a 36-hour sale with 20% off online purchases. Other retailers offered a combination of sale promotions and free shipping to entice customers to their virtual doors.


However, there is one vital component that seems to deliver outstanding traction on Amazon Prime Day – lightning deals. These are nothing more than a short-lived promotion offered on a very limited quantity of merchandise. Purchases are usually only available one per customer, and the sale will run until all available inventory is claimed, or for a specific amount of time.


The Importance of Lightning Deals

Why are lightning deals so important for retailer success? They constitute one of the most significant draws to get customers to Amazon’s website. Despite the Amazon Prime Day-only deals, many shoppers logging onto the site are immediately drawn in by the exclusive lightning deals. Those shoppers usually stay to purchase other items, either because the lightning deal ended before they could make a purchase, or because the customer realized there were other products they wanted to purchase.


How does this translate to success for retailers that are not Amazon? Actually, there’s a great deal of value in running limited promotions similar to Amazon’s lightning deals, and these promotions can be used successfully by both e-commerce companies and brick-and-mortar retailers.

With that being said, there are a few things that you should know if you intend to use this sales tactic to your own benefit.


Creating Your Own Lightning Deals

Retailers looking to create limited promotions don’t need to worry about spending too much time setting up the deals. With a POS in place, time-sensitive deals can be set up with ease, for brick-and-mortar stores and web shops alike.

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In Erply, for example, you can easily set up price lists in the back office. Set a specific timeframe for your promotion, select the item or group of items that the promotion will apply to, and you’re ready to set up lightning deals of your own. Once a price list is created, it will automatically go into effect across all specified locations, so you never have to worry about forgetting to activate or deactivate a promotion.


Using Loss Leaders to Drive Traffic to Physical Stores

For brick-and-mortar retailers, it can seem challenging to pull lightning sales off successfully. However, it can be done. You need to ensure that you’re using the right loss leaders to comepte with Amazon Prime Day deals and drive traffic into your physical store. Really, that’s all the products featured in lightning deals are – loss leaders for an online retailer.

So, what exactly is a loss leader? It’s nothing more than a product (or service!) that’s offered at a significant discount and in limited quantities. In some cases, loss leaders are actually sold to customers below cost (which is one reason that the quantities are often very, very limited).


Why implement loss leaders?

The point of a loss leader is simple – they attract customers to enter your store. Once there, they’re very likely to see what else is on offer, rather than just purchasing the special deal and then leaving. Really, it’s not so much about driving sales of the loss leader as it is getting foot traffic through your store’s door.


You’ll find this strategy at work in pretty much any venue where products or services are sold to the public. Retail stores use them frequently. Even car dealerships do it – those super cheap close-out models with limited inventory? Yep, those are loss leaders, and there may only be one or two such models on the lot in the first place. However, the tactic gets customers through the door.


When customers are attracted to your store by your loss leaders, how will you keep them engaged? Most retailers think of a POS as a behind-the-scenes way to attract customers. In actuality, a POS can be used to draw valuable customer attention by amplifying your store’s displays. Erply’s customer display app lets you schedule images and videos to any device with a display located in your store. Why simply tell customers about your great deals when you can cycle through promotions to guide them as they shop?.


What Makes a Good Loss Leader?

If you intend to put loss leaders to work on your behalf, you’ll need to know how to identify worthwhile options.



Whatever it is that you use as a loss leader, it must have value to your customers. Without value, there’s no point in investing in loss leaders. So, what does value mean? Really, it just means that there is a reason for the purchase – your customers have a way to use that product or a have a need for it. Loss leaders can be targeted at your customer-base as a whole, or broken up by demographics. Look at your business’ previous sales data to identify trends in customer purchases during different times of the year.



The loss leader that you choose needs to connect with your brand. This is not all that difficult for a department store, but it becomes more difficult with specialty retail shops. Looking at past Amazon Prime Day sales shouldn’t be used as your main source of inspiration, because we website operates like a giant online department store. Your loss leader connection doesn’t need to be dramatic, but it should not be something completely unrelated. For instance, an auto part store wouldn’t find much success using diapers as their loss leader.



What we mean here is really more about what the loss leader costs you, not what it costs your customer. You can charge anything you want, as long as it’s perceived as a steep discount. However, you should not break the bank with a loss leader as you will not make your investment back, at least not in the sense of dollars earned per loss-leading item sold. Gauge how likely it is for a customer to purchase additional items after picking up your loss leader, and adjusting your loss leader’s pricing accordingly.

With careful planning and enough insight into your annual sales patterns and customer demand, you should be able to identify not only the right items to use with lightning sales, but also the best options to discount and drive further sales and profitability.


Inventory Considerations: What You Need to Know about Stock for Lightning Deals

When it comes to Amazon Prime Day lightning deals, you’ll want to make sure you have enough stock on hand to handle the demand. However, you also need to beef up the inventory of other items. The goal here is to use lightning deals to draw customers into your store, or to your website. Once there, they’ll stick around to shop. That means chances are excellent that they’re going to purchase items other than what you’re using as a loss leader or as a lightning deal. Of course, that’s good news since you’re probably selling those items at a loss, anyway.

This can be quite the quandary, though. What stock items do you need to beef up your inventory of? What items should be left alone? There’s no simple answer here, but there are a few handy guides that will help.


Historical Solid Sellers

Dig through your inventory information and identify the items that have historically sold best at this time of year. Hint, for most retailers, it probably has something to do with the back to school season. Whatever items traditionally sell well at this time of year will continue to sell well, so you’ll want to bump up your inventory levels in anticipation of demand. Most deals you find on previous Amazon Prime Day sales tend to be popular, commonly purchased items. 


Historical Non-performers

If you have items that historically underperform during this time of year, you should avoid buying extra stock. The increased flood of foot traffic or website visitors might deplete your stock of those items, but there’s a very real risk that you will not offload any extra inventory that you purchased. Keep those levels around the normal range for this period of the year.


Discounted Items

You can count on any item that is discounted to get extra attention around Amazon Prime Day (and when you’re running lightning deals, if you’re doing a non-Prime Day promotion). In fact, one expert interviewed for an article in Entrepreneur actually argued that you need to dramatically increase your stock of any discounted items during this time. “Just because Prime Day deals can’t be approved at this point doesn’t mean you can’t discount items which aren’t ‘official deals’”, he said. “Our clients have seen a 60% to 70% increase in sales across SKUs that were discounted, even though they weren’t a featured deal.”


With all of this being said, caution should be your byword. Yes, you absolutely want to stock more than usual in anticipation of large sales. However, now is not the time to take a risk on new products in large quantities, nor is it the time to push merchandise that does not normally sell well at this time of year.

If your store handles goods from multiple suppliers and warehouses, you’ll need broad insights into your current and moving stock. Consider using a POS to help manage your inventory during this busy time. Erply can help you, semi-automate your inventory ordering processes, transfer products between warehouses, and receive notifications when products levels reach a certain threshold. A POS can give you peace of mind that your stores will be well-stocked in anticipation for huge sale days.


The Customer Service Conundrum: Beefing Up to Handle the Extra Load

Finally, we need to say a few words about customer service. This is particularly true for e-commerce stores, as it can be difficult to keep up with rapid shipping demands during huge sales. You’ll need to prepare your customer service reps, as well as your warehouse staff, well ahead of time.


Customer Service Staff

Both retailers with physical stores and e-commerce companies will need to have additional customer service staff in place to handle questions, complaints, and snafus that occur during major promotions. However, before you bring on temporary staff to handle the influx of customers, you might need to invest in some training and preparation for your existing team.


The aforementioned training should include the answers to some of the questions that you anticipate will be asked the most. In general, these will revolve around the products being discounted – size, volume, capacity, color options, construction material, and the like. You’ll also need to answer questions about shipping, about combining orders, about credit cards, and the like.


When it comes to adding to your team, one of the most important considerations to make is their ability to speak more than one language, particularly if you’ll be selling your product in multiple markets. This is where your store can gain an advantage over Amazon Prime Day deals. Most online shoppers won’t have the convenience of immediate, quality customer service. Establishing your business as a reputable, knowledgeable, and friendly retailer can lead to huge profits during this busy time.


Warehouse Staff

Your warehouse staff will be the key to success (and a large part of customer satisfaction) during major promotions. You will most definitely want to bring additional hands on board for this period – increasing your warehouse staff is more important than hiring more customer service reps, in fact.


Make sure you have ample staff in place to handle the volume of orders that you expect. You may want to slightly overestimate your needs, as it’s generally better to be slightly over prepared rather than underprepared, particularly when it comes to packaging and shipping customer purchases. Make sure that all of your warehouse team are fully trained on packaging best practices, warehouse layout, shipping rules and regulations, and the like. Many Amazon Prime Day orders struggle to meet their owners within the promised two-day shipping period, further emphasizing the need for well-prepared warehouses.


Review Responders

Depending on how you have your e-commerce business set up, responding to reviews may fall to customer service reps, department heads, Internet marketing team members, or someone else completely. However, it’s vital that you have someone in place from the very beginning to handle complaints, ratings, and questions that might be asked through a comment form field, rather than being directed to your customer service reps.


In Conclusion

In the end, Amazon Prime Day might be the intellectual property of Amazon, but it’s grown into one of the most important shopping days for all retailers. Whether you’re part of Amazon’s system, run your own e-commerce operation with multiple channels, or you have a brick-and-mortar store, it can offer a huge boost to your profitability.


Coming through the experience successfully does require planning and preparation. You also to know your inventory and your customers so that you can choose the appropriate loss leaders or lightning deal products. You’ll also need to be sure that you’re prepared to handle the influx of customers without dropping the ball.

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