How to Use Amazon Giveaways to Increase Sales
Updated: October 11, 2019: Amazon announced that Giveaways are no longer being offered.
Want to get initial sales velocity for your products and dozens of paid sales you wouldn't have gotten otherwise? Then try doing product giveaways on Amazon.
Giveaways on Amazon ended with the no-incentivized review apocalypse, right? Think again.
Amazon Giveaway Promotion Tab
The basic overview of how Amazon giveaways works is as follows:
- You buy your merchandise at full cost (but you get credited for these purchases as you would a regular purchase)
- This merchandise is given away to customers for free
- You choose how many items to give away. You also choose the number of entries to accept (i.e. 1 prize for every 100 entries, 1 for every 500 entries, etc.)
- Amazon customers enter your contest free of charge but you can require them to also watch a video of your product before entering
- You can offer non-winners a discount code to purchase the item
You can see how giveaways work for yourself by going to the Amazon Giveaways page. You'll likely find that, as a customer, these contests are actually quite addictive. Are they effective for sellers? That's a question we'll address shortly.
When you run a giveaway you are first required to purchase your items at full cost. However, you will be credited with these sales later as if they were regular orders. This means that you're essentially only paying the cost of goods plus Amazon fees for each product you give away.
The real key to running a successful giveaway though is to make it in conjunction with forcing customers to watch a video along with a coupon code. While you get some benefit from doing purely giveaways, the real bang for your buck comes when non-winners go on to purchase your item.
How Effective are Amazon Giveaways?
We've experienced the entire spectrum of success with Amazon giveaways–everything from complete failures (i.e. no non-winner purchased our items) to complete successes (i.e. LOTS of non-winners purchased our items). Below is an example of one of our more successful giveaways. In this contest, we gave away 21 products (our average cost was around $10 per item) BUT we received 161 purchases with a 25% discount.
Ultimately you need to offer a fairly significant discount (25% is a good starting point to really move the needle) and there is the cost of the giveaways as well. If you're not able to do any discounting on your products (because of profit margin constraints or other factors), giveaways may not be right for you. However, if you are able to do product discounting, giveaways can be extremely effective, especially for product launches and resurrecting dead listings.
How to Launch a Giveaway
You can access Amazon Giveaways by going to Advertising > Promotions (as seen below).
- Select a product to give away from your giveaways page. It sometimes takes Amazon a few minutes to populate the page with all of your products if this is your first time running a giveaway.
- Select your contest type. I generally choose Random Instant Win with a 1 in 2000 chance of winning. If you give away 10 items this means 20,000 people would see your contest. Unless you just feel like being overly generous, I cannot see a downside to making the odds of winning worse (i.e. a 1 in 2 chance of winning means your contest would only be seen by 20 people in the above example).
- Select a requirement for people to enter your contest. For ecommerce sellers, this generally means requiring users to watch 30 seconds of a video. Of course, the big catch here is that you need to have a product video for them to watch.
- Offer contestants the ability to purchase your product at a discount. Without offering a discount your contests will be much less effective. To offer a discount, you will need to follow the normal steps of setting up a promotion within Amazon.
For the promotion ID, you will find this by going to the Manage Promotions page and clicking the desired promotion that you've previously created. See below for an example.
- Finish setting up your contest, including paying for your items at full price. As mentioned before, at this point you will be purchasing your items at full price BUT you will receive this money credited back, minus regular Amazon fees later.
Amazon giveaways can be a fantastic way to get sales velocity for your items, which is especially important for product launches and resuscitating stale products. There can be a significant cost for running the giveaways, both in terms of discounts to non-winners and the cost of the giveaways themselves. However, this cost relative to, for example, a paid Facebook Ads campaign, can often be much less expensive.
Have you tried using Amazon Giveaways? If so, were they successful for you or not successful? Share your comments and thoughts below.
How do you get traffic to your giveaways?
Do you just make it public and Amazon actually sends that much traffic or are you advertising it in some way?
Hi Jason – Amazon promotes them internally. There’s no need to drive external traffic to them.
1. You’re giving away your new product, correct? Not someone else’s product when you then promote your product in the video?
2. The video seems to be the key to a success non-winner purchase rate, correct? Can you share tips on how to align that video to the giveaway appropriately? And any other best practices for converting video watchers into buyers?
Hi Todd, 1) Yes, we’re giving away one of our new products. 2) Amazon is not very restrictive on the video – it can be a youtube video with your company URL all over it but ultimately we’re just using a regular Amazon product videos. Producing a great product video probably requires its own episode alone :)
Thanks Dave, follow up question…would you recommend giving away the same product that you’re then promoting with the discount? Or should they be separate products?
I’d use the same product.
Absolutely fabulous … Would be good some ways to create content for the video. What you should say or how to best create a video that drives sales.
Hi Gino, We didn’t do anything over the top – it’s just a good video showing the product. At some point we’ll do a post or episode on producing good videos. It’s too much for a comment.
What was the difference between your successful and unsuccessful giveaways? Also, what did your video look like?
Hi Halid – having a mass-consumer product is the best. People will enter ANY contest for a freebie but few will actually pay for the product unless they have a real need/desire. For example, selling toilet tissue is likely to result in more non-winner sales than selling a 1993 Jeep Wrangler Bull Bar (EVERYONE needs to the former, few people need the latter).
Thanks for you nice and clear post. I have a few questions for you if you don’t mind.
I will start with my first one :)
What is the pros and cons between the “Random Instant Win” and the “Lucky Number Instant Winner”
In other words: ” why did you chose the Random Winner over the Lucky Number Winner”?
Random instant win will announce to the contestant right away and is arguably more likely to result in immediate sales. Lucky number draws I believe will be announced AFTER the contest is finished.
BTW, Amazon just banned the Random Instant Win option.
Also, they changed to 1 of 1300
Ha! Thanks for the headsup. Makes sense that they did this :)
This is Joseph again with my second question :)
I have notice at the title of this post that you are going to mention “HOW TO USE PRODUCT GIVEAWAYS ON AMAZON WITHOUT GETTING BANNED” but I didn’t found anything addressing the “WITHOUT GETTING BANNED” part.
Am I missing something?
Please share with us what we should know in order not to get banned.
I should have clarified – giveaways in return for product reviews are a big nono.https://www.ecomcrew.com/wp-admin/edit-comments.php#comments-form
My third question for you is: I noticed on the givaway you shared on the post that you orignally planned to givaway 30 units, but at the end, there were only 21 winners, so my question is; “What happend with the rest 9 units, did you got refunded on them?”
Not enough contestants in the pool. And yes, you get refunded for them.
And here is my last one (for today) :)
I assume this is a hard one, but I will still try my luck. Could you refer me to somone that could record for me the short video?
Sepearlty, how importent is to get the vedio?
Can I expect any sucsess just by giving a %25 off discount?
Thank You, Dave, and have a wondefull day
Hehe no one I can refer you to but keep in mind a good product video will cost you thousands to have done. Or cheap out and DIY through Animoto :)
Hi Dave, thanks for the great article. I have ran these giveaways on a small scale but plan to use it more aggressively to bump ranking once one of my products gets back in stock. Have you generally seen that the increase sales velocity from these giveaways bumps ranking for all keywords? If not what have you seen?
Hi Brad – yes if you’re able to convert the non-winners the increased velocity really helps SEO in general. Mike has some impressive results he’s tracked on his end.
The video seems to be the key to a success non-winner purchase rate, correct? Can you share tips on how to align that video to the giveaway appropriately? And any other best practices for converting video watchers into buyers?
Hi Todd sorry for the late reply – I responded to your previous comment.
I started creating a giveaway, and it only allowed me to select one ASIN. Is there a way to do this with a parent ASIN? My products almost all have size variants, so it would be difficult to do an effective giveaway without providing the option for the customer to choose the right size.
Also, when you set up the promotion, is it best to use the “group” claim code?
as far as I know the giveaway product cannot be a parent ASIN. The discounted product I’m not sure about BUT you could make a promo code available to all the children (and promote this heavily in your marketing video) which may be effective.
How effective could this be if you require the customers to watch a youtube video of your product to enter the contest and send them to a squeeze page from youtube that offers a discount to capture their email? I guess you may have to select “NO” to the discount when setting up the giveaway for this to be effective.
I think it could be a stretch to expect a lot of people to manually type in a URL from the youtube video. If you had a product that converts extremely well though it might work.
I have been trying to make a Giveaway all week but have found errors on the Amazon site when I a) Try to add a product to include in a percentage off promotion b) Creating the actual percentage off promotion and trying to add that to the give-away. Is anyone else having difficulty. I love this Give-way process but as a new seller these bugs are ruining my launch with Amazon platform. If an Ecomm Crew member would I get a chance to talk through these strategies???
Can you send a screenshot here of the error as well as a screenshot of where you’re grabbing the promotion ID from? I suspect you’re using the wrong promotion ID, but this is only a suspicion.
Hi thanks for the good post.
What kind of video do you require contesters to watch? Is it about product you are giving away? Also do you have blog post about more info on how you shoot these videos ?
Hi Boris – yes, it’s about the product. It’s hosted on YouTube and so you have some decent flexibility with info you can include in the video (and outside marketing). No article yet, but hopefully in the future :)
As of September 2018 individual third party Amazon giveaways no longer allow for a Random Winner option. The Lucky Number giveaway option is the only one that can go public and the “ lucky number” as mandated by Amazon is quite high, often insuring unclaimed prizes. Finally the First Come, First Served giveaway option is now purely private, dependent solely on the social connections of the giveaway sponsor.
Thank you for the upate!
I am an Amazon newbie and I have a question. How long does a Giveaway last? I cannot see an option to set a time frame. I assume a Giveaway is not valid until all your selected number of prizes are claimed (because I saw in your video that you get refund for the ones not claimed). So, is it one day, one week, how long? Thank you.
It goes until all the prizes are given away or *1 week* (I thin kfor the later).
Man Dave, you a real one for replying to all these comments (tips hat)….Do you know when the prizes you buy are actually accounted for as sales? Is it as soon as you set the contest up or when the prizes are awarded to winners?
That info might change the timing of launching a contest during a sales blitz.
Hi Halid – I’m not sure actually but you get charged as soon as you launch the contest.
Hey Dave, I gave this a go. Easy to set up and run and good to generate page hits and give out promo codes.
What I found though was a lot of discount codes got accepted, added to cart, but the sale never completed. Have you guys found this at all? eg, out of 50-60 codes only 5 sales.
YES! I would say 10% conversion rate on them is about average.
Hey Dave, very late follow up on the promotions topic.
Are other launch promotion services still viable in your opinion from a ToS point of view? For example Zonblast (SixLeaf).
I just ran an AZ giveaway recently. Interesting that they’re being discontinued !
If the promotion services are simply giving away products with nothing being tied to reviews, it’s not something Amazon is suspending people for. At some point they may clamp down saying they’re “manipulating search results” but it’s not happening yet.
Dave, as always, great info.
With the new algorithm change I’ve noticed that GA are no longer as popular as they were before. HOWEVER, I do use them to kickstart a day. I basically run one very early in the morning and then organic sales start happening too!
I usually go for a 20% discount and noticed that albeit the info on the GA updates quite slow, the whole thing basically pays for itself.
Yep! The giveaways are a great way to pickup sluggish sales.
Hi Dave, Excellent Giveaway instructions video.
Can I ask if you use just a single Discount Code for the unsuccessful visitors or does Amazon Distribute Single Use Codes automatically?
Thank for any help and advice you can provide.
I normally just use a single use code so can’t really comment.
Can I run multiple giveaways on the same product if I keep the total under 30? Want to test it out. Also, do the videos views count as official views on YouTube? Very comprehensive piece; thx so much guys.
Hi Jaco – yes, I believe you have multiple giveaways for the same products, although not 100% sure. Yes, the views count towards YouTube views.
Hi Dave, in Amazon giveaway setup, it advised to setup the promotion as single-use, uncheck 1 redemption box and preferential. I would like to ask if say we set up as 40% OFF single use promotion. In that case, we paste the Promotion ID into the giveaway campaign. Do we need to manually create promo codes in the Manage Claim Codes in that 40% promotion just created? If not, I wonder what codes will Amazon give the non winners entrants, or will Amazon generate the codes automatically or applied to their cart automatically?
You set it up as a group promotion. It should create a single coupon code for all people that Amazon will automatically populate when you paste the promotion ID.
I’ve been running my Giveaways using a single use coupon code and wondering the same thing – is Amazon actually producing codes?
My reluctance to use a group code is the shear fact that the code has unlimited use – i.e. you could have your entire inventory wiped out.
Obviously you can take the standard steps to protect inventory – but there’s still risk attached to using the “group claim code”
How do you manage this?
Have you ever run a giveaway with a single us claim code? Do you think it works either way?
Thanks in advance
The best way is to use a coupon code that’s not excessive and that you’re ‘happy’ when people use.
Digging the new format to the podcast! I ran Amazon Giveaways with good results when I launched my product. Now, I’m back in stock after running out late-summer and would like to regain sales momentum as quickly as possible. What’s the best way to do that now that Amazon Giveaways are retired? I’ve started offering 90% off single-use promo codes on Facebook with ManyChat, but haven’t had any bites yet!
Done. Thanks, Dave! You guys are a great resource. Just signed up for Premium.
Fantastic! And thanks for complements :)