Amazon’s Prime Day Ain’t What it Used to Be
The Thrill is Gone
Since 2015, Amazon (AMZN) has leaned on its “Prime Day” to boost sales, often during the typically slower summer season. This year’s event is scheduled for July 12 and 13. The tech giant endeavored to “make it the biggest day ever” and featured special graphics on its home page and even sponsored concerts as well as celebrity appearances to generate buzz around the event.
Last year, the prime day party seemed to lose its allure as the company maintained its standard home page and ditched the special events. Some industry analysts contend that as the novelty wore off, so did the interest from consumers and Amazon alike.
Part of the reason for slowing growth may be Prime Day’s emphasis on Amazon’s own products. Discounts on all other items are largely on par with what is offered year-round. Declining order sizes and revenue may indicate consumers don’t see the day as much of a benefit.
Still, market observers contend that the event’s success can provide a temperature check for consumer spending, since sales during the event roughly double those at other times of the year.
In the past, some retailers like Target (TGT) and Walmart (WMT) attempted to thwart loss of market share during the event by price-matching the deals offered by Amazon. This typically snagged them a 72% pop in revenue during the period. This year the boost is projected to be just a fraction of that amount, estimated at just under 18%.
While some consumers may lament the potentially diminishing number of juicy online deals, there is another trend that could fill the gap. Many retailers are looking to unload excess inventory caused by supply-chain snarls. This may prove to be fertile hunting grounds for the budget-minded shopper.
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