Brands Aim for Profitability on Amazon Prime Day 2024

With retail media spending on the rise, advertisers will want to avoid a significant cost increase during this year’s Amazon Prime Day sale.

The 10th annual Prime Day will take place over two days, July 16 and 17. According to Digital Commerce 360, gross merchandise sales during Prime Day 2023 will reach $12.9 billion – a 6.7% increase year over year.

A study by e-commerce optimization firm Perpetua found that last year, the event saw an average decline in advertising costs as a percentage of sales (ACOS) — meaning brands likely saw profitability during Prime Day “for the first time in several years.”

On the first day of Prime Day 2023, Perpetua data showed that ACOS was down 14% year-over-year on the first day, and down 2% on the second day.

Prime Day 2023 cost-per-click (CPC) increased by +40% year-over-year on day 1 and +46% on day 2 of the event. However, the cost increases appear to be offset by significant improvements in average order value (AOV) and conversion rate (CVR).

According to Perpetua, this means that while customers remained methodical, more of them made purchases after reaching the product details page.