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Amazon Prime Day 2021: A look beyond the topline numbers

Amazon Prime Day 2021: A look beyond the topline numbers

Amazon Prime Day 2021 may be over, but there’s plenty to learn from this year’s annual sale, which has become a fixture on the retail holiday calendar and prompts other retailers to run competing sales to capitalize on the influx of web traffic.

Digital Commerce 360 estimates consumers spent $11.19 billion globally with Amazon.com Inc., No. 1 in the 2021 Digital Commerce 360 Top 1000, during the retail giant’s 48-hour summer event. That’s up 7.6% from $10.39 billion over the same sales period last year—a deceleration from the growth registered by prior Prime Days.

But there are more takeaways than just sales totals through Amazon. Here’s a recap of Prime Day data from ecommerce technology companies that track online spending and buying behavior.

Retailers record modest online sales growth during Amazon Prime Day 2021

During the two-day Amazon Prime Day sales event, U.S. online spending through all ecommerce sites surpassed $11.0 billion, up 6.1% from $10.4 billion for the sale in 2020, according to the Adobe Digital Economy Index. The analysis from research firm Adobe Analytics, the insights arm of technology company Adobe Inc., is based on more than 1 trillion visits to more than 4,500 retail sites and measures transactions from 80 of the top 100 online retailers ranked in the Top 1000. The data captures more than 100 million SKUs in 18 product categories.

Adobe says U.S. digital revenue on June 21—the first day of the Prime Day period this year—topped $5.6 billion, increasing 8.7% over Oct. 13, 2020, when the event kicked off last year after being postponed due to the pandemic. But growth slowed on day two—June 22—when online sales rose just 3.6% from the 2020 counterpart to over $5.4 billion, dragging down the performance of retailers for the overall Prime Day event.

June 21 and June 22 both mark the biggest days in ecommerce so far this year and each day raked in more digital revenue than the $5.1 billion spent online on Thanksgiving Day 2020 as well as the Saturday and Sunday of the Cyber 5 weekend last year, Adobe says.

Data from software provider Salesforce.com Inc. also suggests a more muted Prime Day. Both global and U.S. online sales for non-Amazon retailers, which capitalized on the influx of web traffic and consumer attention those days by holding competing sales, were flat—dropping 1% compared with the mid-October 2020 event. The vendor aggregates data from its clients, including more than 1 billion global shoppers on its Commerce Cloud platform, and extrapolates its clients’ findings to the broader retail industry.

Large, omnichannel retailers win during Prime Day

Large retailers, or merchants with $1 billion or more in annual online revenue, benefitted from sales seekers during the 48-hour, Amazon-manufactured retail holiday and grew ecommerce revenue by 29% over an average June day, according to Adobe data. But as consumers comparison shopped with smaller retailers, or those with less than $10 million in annual online revenue, this group of merchants increased their online sales by 21% over the control summer day, Adobe says.

“The halo effect of Prime Day played a significant role, giving both large and small online retailers significant revenue lifts,” says Taylor Schreiner, director of Adobe Digital insights.

Additionally, in keeping with the pandemic-driven demand for omnichannel services, merchants with a brick-and-mortar presence had an edge during Prime Day. Retailers that offer a buy online, pick up in store, or BOPIS, program boosted their conversion rates by 10% compared with an average June day versus a 3% bump in conversion rate for retailers without the same feature, Adobe says.

Discount rates drop while AOVs increase

Inflation, inventory issues and logistics challenges have impacted the ecommerce industry throughout 2020 and 2021, and these complications influenced Prime Day.

“Manufacturing delays and raw materials scarcity have made it difficult for retailers to stock their shelves. Couple that with unprecedented demand and labor shortages, and we are living in the middle of an Economics 101 course,” says Caila Schwartz, senior manager of consumer strategy and insights at Salesforce. “For consumers, this has meant higher prices and lower discounting to stave off demand and release margin pressure.”

Retailers discounted products at a lower rate this year, as the average discount rate for non-Amazon retailers decreased 13% compared with 2020’s Prime Day event, when the average price reduction range was 15%-18%, Salesforce says. The average order value simultaneously increased by 7% year over year while the number of orders decreased by 8% from the same sales period in 2020. Meanwhile, the number of items per order remained flat, “suggesting that despite softer discounting, retailers are raising prices to compensate for the current market environment,” Schwartz adds.

Dollars spent on Amazon orders decreases slightly

According to data from a Numerator panel, which derives its insights from purchasing patterns on the Amazon platform, Prime Day shoppers’ spending on the site has been decreasing a bit over the past two years. The average order was $52.33 in 2021, down from $54.34 in 2020 and $58.77 in 2019.

During the sale, Numerator says households placed an average of 2.8 orders on Amazon this year, which is on par with 2.9 in 2019. But nearly a quarter of households placed four or more separate Prime Day orders, with 16% completing five or more and an additional 8% completing four. The average number of items per order has held steady at 1.7 for the past three Prime Days. More than half of Prime Day transactions were less than $30 while a quarter more than over $50.

Numerator data is based on 30,806 Prime Day orders placed through Amazon and spanning 12,956 unique households as well as a survey of 3,132 verified buyers.

Amazon gains market share among top competitors

Growth in sales through the Amazon platform during Prime Day allowed the company to take market share from other big players, according to data from digital commerce intelligence provider Edison Trends. The company analyzed the performance of Amazon as well as Walmart Inc. (No. 2), Best Buy Co. Inc. (No. 5), Target Corp. (No. 6) and Kohl’s Corp. (No. 18)—four competitors that ran counter sales to challenge the retail giant. Among this group of five leading online retailers, Amazon grew its share of revenue generated by this group of five leading online retailers during Prime Day to 87.5% this year from 84.8% in 2020.

The four competitors studied all lost Prime Day market share to Amazon, Edison Trends says. Best Buy had the biggest drop with a 2-percentage-point decline to 3.8% from 5.8% last year. Target garnered a 2.8% share, losing just 0.1 percentage points, and Walmart dropped 0.2 percentage points to 5.4%.

Edison Trends’ data is based on e-receipts from more than 400,000 online transactions accessed through the email of U.S. consumers.

Other insights from Amazon Prime Day 2021:

 

Percentage changes may not align exactly with dollar figures due to rounding.

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