Prime Day Is a Prime Day for Retailers ‑‑ And Not Just Amazon
Summer has just begun and the calendar shows plenty of time before the holidays, but marketers know better. Retailers have to think about the holidays earlier and earlier, in response to many consumers doing just that. According to a National Retail Federation survey, 40% of consumers plan to start their holiday shopping before November; 12% will do so before September. And that’s just The Holidays. The NRF’s survey didn’t consider all the other big shopping events between now and Black Friday, such as Fourth of July sales, back-to-school shopping… and Prime Day.
Amazon created its own Christmas in July in 2015, promising Prime members “more deals than Black Friday.” Each of the subsequent Prime Days have been record-breaking sales days for Amazon. During Prime Day 2018, Amazon sold more than 100 million products, totaling $4.19 billion. That’s more than its Black Friday and Cyber Monday sales combined.
Prime Day 2019 promises to be another big day — the sale has been extended to two whole days — and not just for Amazon.
What Prime Day Means for Macy’s, Target, eBay, etc.
Surveying 200 retail executives last year, RetailMeNot found that 54% planned their promotions around Prime Day. Among them were Macy’s, Best Buy, Bed Bath and Beyond, Home Depot and Target. The latter’s answer to Prime Day ended up being one of the retailer’s biggest ecommerce days of the entire year. This year, Target’s ‘Deal Days’ lives online, but it extends to BOPIS and includes same-day grocery delivery. The latter is noteworthy as groceries are Amazon’s fastest-growing category. According to a Profitero study of 1,000 consumers in the U.S. and the U.K., 24% of Americans plan to make online grocery purchases during Prime Day.
Just as Prime Day is extended, so is Deal Days. Taking it even further, Walmart has four days of deals. Walmart’s annual mid-July extravaganza dates back to 2015, created in response to Prime Day. Then-President Fernando Madeira wrote on the company’s blog, “The idea of asking customers to pay extra in order to save money just doesn’t add up for us,” a reference to Amazon’s sale being members-only.
eBay is also defensively discounting, offering customers 110% of the price difference if they can find an item for less on an approved competitors’ website. That list, of course, includes Amazon. eBay also promises extra discounts if Amazon’s website crashes during Prime Day, as it did for about an hour last year.
The Benefits of Brand Loyalty
Over the last four years, Prime Day has become an ecommerce extravaganza on par with Cyber Weekend. This year, more than 250 retailers are expected to participate. And those that do experience a 30% increase in traffic from RetailMeNot. At the same time, those without deals saw 4% less traffic last year, relative to the rest of July.
All this, despite the fact that Amazon… just kind of made it up to celebrate the company’s 20th anniversary. And while Amazon has experienced success on a grand scale, the concept of creating holidays isn’t unusual in the retail space.
Nordstrom has a huge Anniversary Sale every year, a popular enough event that People wrote an article on how to get the best deals. (Number one: Join the loyalty program for early access and extra points.) Similarly, Wayfair saw a 325% per-day increase in sales during the second annual Way Day in April.
The success of these made-up ecommerce holidays broadcasts a few things to retailers. For one, it proves once and for all that “the holidays” aren’t limited to those last few weeks of the year. It also underlines the importance of brand loyalty. We already know that loyal customers are the best customers and if yours are loyal enough, you can invent new shopping holidays.