Amazon.com Inc.’s Prime Day, its annual sales event typically held in the summer, will span over two days this fall on Oct. 13-14, the retail giant announced Monday. Like last year, Prime Day deals will run for 48 hours. Prime Day will be held in 19 countries this year, including first-time participants Turkey and Brazil.
Prime Day, which features deals on many products on Amazon.com, began in 2015 as a celebration of Amazon’s 20th year in business. It turned into a summer sales holiday designed to generate additional business for Amazon—and the retailer’s marketplace sellers—before the holiday shopping season. This year, Amazon postponed the sales event from its usual July time slot because of the coronavirus pandemic.
Prime Day is also a vehicle for Amazon to sign more shoppers up for its Prime membership, a $119 per-year loyalty program that offers such perks as free one- or two-day shipping, digital photo storage and video streaming. The Prime Day deals are only available to Prime members.
There are more than 150 million Prime subscribers, Amazon said in January. That’s up from 100 million Prime members in April 2018. On July 15, the first of last year’s two Prime Days, Amazon signed up more new Prime members than any previous day and nearly matched that record on July 16, the retailer says.
Prime Day 2019, Amazon’s fifth such event, generated a Digital Commerce 360-estimated $7.16 billion globally over the 48-hour period between July 15-16, 2019. That was an increase of 71% from the $4.19 billion during the 36-hour sales event in 2018.
How does Prime Day compare with other online shopping holidays?
Based on Digital Commerce 360’s estimates, the 2019 Prime Day sales event still lags behind larger shopping events such as the Cyber 5 (the five-day shopping period Thanksgiving Day through Cyber Monday) or Chinese ecommerce giant Alibaba’s Singles’ Day event held on Nov. 11 each year.
The question this year is if Prime Day will affect Cyber 5 and holiday shopping. In previous years, it’s unlikely that Prime Day events cut into the shopping consumers do in November and December. Digital Commerce 360 analysis shows the bulk of Prime Day shopping in previous years was consumers purchasing goods for themselves rather than holiday gifts.
This year may be a different story. For one, Prime Day is less than two months before Black Friday and Cyber Monday, and holiday shopping may be more top-of-mind mid-October than in July. In fact, 21% of consumers say they will begin holiday shopping in September and October, according to a Digital Commerce 360 and Bizrate Insights survey of 1,000 U.S. online shoppers in September 2020. That compares with the 29% who plan to start holiday shopping in early November, which was the top response.
In a similar Digital Commerce 360 and Bizrate Insights survey of 1,055 online shoppers conducted in October 2019, just 4% of shoppers began holiday gift-buying on Prime Day 2019.
Second, the COVID-19 pandemic has pushed more consumers online, particularly shoppers who aren’t comfortable shopping in physical stores yet. As the top retailer in North America with a loyal consumer base, Amazon is likely to capture at least some of the new online holiday shoppers.
Our survey supports this theory. 48% of shoppers intend to purchase at least half of their holiday gifts on Amazon this year, according to the survey. And 42% will shop earlier knowing delivery times may be longer. 46% plan to buy most of their holiday purchases online.
Amazon’s focus on marketplace sellers
For this year’s Prime Day event, Amazon seems to be focusing more on its marketplace sellers—which it refers to as small businesses—than in previous years. For example, it intends to have “curated small business collections” during Prime Day, where consumers can browse marketplace sellers’ products by category, business location and owner profiles on Amazon.com/SupportSmall.
Additionally, Prime members will get $10 to shop on any products on Prime Day(s) when they spend at least $10 on items sold by marketplace sellers starting today through Oct. 12. This promotion is funded by Amazon, the company says.
Amazon said sales of products from its marketplace sellers crossed $2 billion in last year’s event. Comparatively, in 2018 Amazon said its marketplace sales “far exceeded” $1 billion.
Digital Commerce 360 estimates marketplace sellers’ sales only account for about a third of Prime Day sales. This breakdown is different from Amazon’s annual gross merchandise sales, for which marketplace sellers accounted for 60% in 2019. The share of marketplace sales is different on Prime Day because Amazon has historically used this sales event to promote its own products.
For instance, top-selling products worldwide were Amazon’s Echo Dot and Fire TV Sticks. And this year, Prime Day deals on Amazon devices already started Monday. There are also deals on Amazon’s other services, such as Amazon Music Unlimited, Kindle Unlimited, Amazon Fashion and Amazon Fresh.
Sales of marketplace products were $2.29 billion for Prime Day 2019, Digital Commerce 360 estimates.
Amazon is No. 3 in the Digital Commerce 360 ranking of the Top 100 largest online marketplaces around the world.