21
July

By avi maxwel / in , , , , , , , /

Amazons
AMZN
announced the company had its biggest Prime Day event ever, driving consumers to spend online. Prime members purchased more than 375 million items worldwide and saved more than $2.5 billion on millions of deals across Amazon’s extensive product line. “The first day of Prime Day was the largest sales day in Amazon’s history, and Prime members saved more this year than any other Prime Day event,” said Doug Herrington, CEO of Amazon Stores.

On the first day of Prime Day 2023, more deals were offered than on any other Prime Day, with home, fashion, and beauty among the top-selling deal categories. Top selling individual products including Fire TV Stick, LANEIGE
IGE
Lip Glowy Balm, Apple AirPods, and Bissell Little Green Portable Deep Cleaner.

Invitations only deals worked well

Amazon used its invite only days ahead of Prime Day to entice its Prime Members to shop early. “It is not as much of a surprise as history repeating itself. Just like we went from Black Friday sales to those sales starting on or before Thanksgiving and going for more than a week through Green Monday, we saw Prime Day become a multi-day affair this year,” said Sarah Engel, President of January Digital. She compared how the invite only deals offered prior to the start of the sale were much like the door-busters of retail’s past. Meanwhile, hundreds of promotions have continued beyond Prime Day so the event, while breaking many records, started early and is ending later.

Online purchasing across US driven by Prime Day promotion

Although Amazon did not disclose the specific revenue generated for its Prime Day event, the highly promoted event drove purchasing online throughout the US market across many retailers. Consumers spent $12.7 billion online in the US over the two day Amazon Prime Day event, setting a new record for online shopping and representing a 6.1% growth year-over-year, according to Adobe Analytics.

“You also saw larger retailers take advantage of the Prime Day halo effect to launch mid-summer savings events, many of which last longer than the official 2 days of Prime Day,” said Engel. Some examples include the Nordstrom Anniversary Sale which started its Early Access sale to coincide with Prime Day, Target Circle Week, Best Buy’s Black Friday in July and Walmart Plus Week.

The ecosystem expanded

Amazon included third party sellers on its marketplace to participate in the promotional activities in connection with Prime Day to further the spend in its own ecosystem. “Retailers have realized that the closed ecosystem nature of Amazon shopping does not open up as many opportunities for them as once thought. Most shoppers go in through the Amazon App or site, search there, shop there, buy there, and then get out,” said Engel.

Deals from partners were heavily promoted across the website with premium on-site banners in the Amazon store, used in influencer marketing and digital advertising campaigns. Amazon partners rode the coattails of the most recognized sale event in US commerce with participating merchants experiencing a tenfold increase in daily Buy with Prime orders and an eightfold increase in daily revenue from those orders compared to the previous month.

Shopping behaviors sticking with consumers

Mobile shopping remains a key driver of online purchasing. In the US market, smartphones were used for 44.8% of online sales on the first day of Prime Day across online retailers, which was higher than last year’s 41.5%. Specific Amazon mobile purchasing numbers were not available.

Curbside pickup (where retailers offered that service) was used in 20% of online orders, a consumer behavior that has persisted post-pandemic.

Marketing dollars experienced greater revenue contribution across different channels including influencer marketing up 11%, email up 6%, social and display advertising up 4%. Adobe Analytics compiles data from over one trillion visits to US retail sites, 100 million SKUs, and 18 product categories.

Will Prime Day End?

“There is a rumor of Prime Day going away after this upcoming July sale. I believe it may take a different shape, but I do not see it going away completely,” said Engel. Amazon uses Prime Day to further its reach among consumers and add to its advertising flywheel of revenue including streaming. “Considering that Amazon announced it was their largest Prime Day sale ever, and that the entire industry has taken to leveraging this as their mid-summer promotional timeline, this is simply our new normal,” said Engel. It remains to be seen whether some of the early access, invite-only deals were a boon for Amazon, and whether that shifts to a broader timeline for the sale in the future, discussed Engel. “I could see Amazon adding days, offering merchant exclusivity on early access days, or even more interesting, elevating to a new, higher Prime Membership level.” More than likely, 2023 will not be Amazon’s last Prime Day.