Amazon Advertising

Profit versus Scale: How to Choose Your Amazon Advertising Strategies for Major Sales Events Like Prime Day

7th April 2025 | Bennie Valencia
Black-and-white image of a thinking astronaut seated with one hand on their chin, set against a starry space background. To the right, a bright blue and green graphic reads 'To Profit or To Scale?' with the Incrementum Digital logo above it.
Reading Time: 5 minutes

What’s the smarter move during big Amazon sales events like Prime Day and Prime Big Deal Days: chase massive scale, or guard your margins like a hawk? Every brand faces the same fork in the road. One path grabs attention fast but risks runaway ad costs. The other plays it lean, squeezing out profit without burning budget. Neither is wrong. But one is right for you. In this breakdown, we unpack the pros, pitfalls, and winning plays behind both strategies, plus show you two examples of how our ads team made each approach work during Amazon’s Big Spring Deals Sale.

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Profit versus Scale: How to Choose Your Amazon Advertising Strategies for Major Sales Events Like Prime Day

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The Tradeoff: Why Scale and Profit Don’t Always Align

Sales events bring the heat. Traffic spikes. Shoppers flood in. On the surface, it looks like the perfect moment to go big. And for many, like during Prime Day 2024, that paid off. Mobile shopping alone drove $7 billion in purchases, and categories like electronics, school supplies, and household staples saw massive lifts. But that kind of momentum also brings rising CPCs, fiercer competition, and mounting pressure to discount just to keep up.

Some brands leaned in and captured the volume but saw their margins take a hit. Others held back, played it safe, and watched from the sidelines as competitors dominated the share of voice. Now, what’s the difference between a win and a wasted spend? The answer is clarity, i.e., you need to know what you’re solving for before the event starts. Growth? Efficiency? Long-term ROI? Choose your goal, then design your campaign around it.

How to Choose Between Prioritizing Profit and Scale

Every brand wants to make the most of major Amazon sales events. But how you approach them depends entirely on your business model, goals, and where your brand is in its growth cycle. Some brands zero in on profitability. Others chase reach and long-term momentum. There’s no single right move, just the one that makes the most sense for you.

 

Profitability: Maximize Efficiency, Protect Margins

If your brand runs on tight margins or sells products that don’t drive repeat purchases, then chasing volume during a sales event isn’t always the smart play. With Amazon’s upcoming 2025 fee hikes adding more pressure, every dollar you’ll spend needs to work harder. A profit-first strategy focuses on efficiency. That means stretching your budget across only the highest-return campaigns, protecting TACoS, and investing in what already works. You’re not trying to win every impression; you’re trying to win the right ones.

Here’s an example: Our client in the baby apparel category was already a bestseller in their category and has strong reviews as well as organic traction. Rather than flooding the zone with spend or relying on steep discounts, we focused on tightening their performance. We finalized budgets early, improved keyword rankings in the lead-up to the event, and prioritized stable SKUs with consistent conversion data. To expand reach without inflating costs, we targeted adjacent categories like mittens and socks, turned off dayparting to capture round-the-clock demand, and used Sponsored Display to re-engage high-intent browsers. Real-time budget reallocation kept top campaigns running strong throughout.

The result: A 71.5% increase in daily sales and a 48.5% drop in TACoS year over year.

Profit-first doesn’t mean playing it safe. It means making every dollar count, especially when the stakes are high. (Want to improve your TACoS? Here’s how.)

Scale: Prioritize Reach, Build Long-Term Gains

If your brand has healthy margins, strong repeat purchase behavior, or high lifetime value (LTV) products, a scale-first strategy during sales events can unlock exponential growth. This approach is built for long-term growth, not short-term efficiency. During major sales events, the brand invests in visibility, offering broad promotions and increasing ad coverage to drive as much traffic as possible. The goal isn’t to maintain a low TACoS in the moment, but to capture new customers at scale, boost organic rankings, and create a larger base for future reorders. When done right, it turns an initial sales spike into sustained momentum and repeat purchases.

Of course, scaling comes with tradeoffs: higher CPCs, steeper competition, and temporary inefficiencies. But when your unit economics are strong and your funnel is built to convert and retain, the upside far outweighs the short-term cost.

For example: This was the case for a supplement brand we managed during the Big Spring Deals Sale. Their performance had dipped leading up to the event due to inventory gaps and uneven visibility. Rather than retreat, they saw the event as a reset button. We launched Spring Deals across their top SKUs and reinforced them with high-trust ad formats like Sponsored Brand Headline and Store Spotlight to boost credibility and visibility. Sponsored Product campaigns helped cross-sell and defend branded terms, while low-bid auto campaigns expanded our reach at minimal cost.

As performance data rolled in, we reallocated budget in real time: scaling what worked, cutting what didn’t. In just three days, sales jumped to a 40% increase. TACoS rose slightly, but the client embraced the tradeoff. With strong LTV and repeat rates, acquiring more customers at scale was the long game.

Not sure whether to scale or focus on profit during big sales events? This cheat sheet breaks it down:

Comparison chart titled “Profitability First vs. Scale Aggressively,” featuring two columns that help brands decide their strategy during Amazon sales events. The left column (Profitability First) includes indicators like tight margins, low repeat rate, and focus on ROAS. The right column (Scale Aggressively) highlights traits such as high LTV, strong DSP performance, and willingness to trade short-term profit for long-term growth. The graphic has a neon-accented space theme with an astronaut on the right side.

Profitability First: This is for brands that need to be extra careful with their ad spend. If your margins are already tight, your product doesn’t get repeat purchases often, or you’re new to Amazon DSP and want to avoid unnecessary spending, you’re in the profitability camp. Maybe your inventory is limited or you’re not currently running deep discounts. In this case, your goal is to make the most out of what you already have: protect your TACoS, focus on proven best-sellers, and keep short-term profit a top priority. You’re aiming for controlled, efficient growth that doesn’t put your margins at risk.
Scale Aggressively: This is for brands with more breathing room and long-term growth goals. If you’ve got healthy margins, high lifetime value products, and solid DSP performance, you’re in a good place to scale. You’ve got inventory ready, a reliable supply chain, and you’re okay with higher TACoS if it means gaining market share. You’re likely exploring new product launches or pushing a broader catalog, and are willing to pair your ad strategy with promotions. Short-term efficiency takes a back seat, because your brand can handle the upfront cost for bigger returns later.

The Bottom Line: Strategy Follows Your Business Model

Not every brand can afford to spend like a category leader. And not every brand should stay stuck in efficiency mode. The right strategy depends on your margins, your product lifecycle, and how your customers behave after the first purchase. If your margins are thin, focus on efficiency and stretch every ad dollar. If you’ve got room to invest and a strong LTV story, scale with confidence and set the stage for future growth.

Not sure which lane fits your brand? That’s exactly what our free brand audit is for. We’ll dig into your performance, show you what’s driving results, and help you build the right strategy for your next big sales event.

Book your free audit here.

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