Amazon Prime Day 2018 will start on July 16, 2018. This year, the company has announced a bigger-than-ever promotional event, which will see more deals and more products on offer for a longer period of time.
- Amazon is planning to make Prime Day 2018 the biggest sales event in its history by offering more deals on more products and new ways to access the promotions.
- We expect Amazon to focus this year’s promotions on its own devices—in particular its smart assistant Echo product line—and its private labels in categories such as apparel.
- We estimate that Amazon will generate around $3.4 billion in sales worldwide during this year’s event, compared to an estimated $2.4 billion last year.
Amazon Prime Day 2018 is fast approaching and will start on July 16, 2018. The company has announced a bigger-than-ever promotional event this year, which will see more deals, more products on offer, a focus on Amazon’s own smart assistant devices and own-label products in apparel and other categories. As well, for the first time, US Prime members will be able to access Prime deals offline, in Whole Foods Market stores.
Amazon Prime Day 2018 is anticipated to become the biggest shopping day for the retailer in terms of revenues. We forecast, rather conservatively, that sales generated during the event will reach $3.4 billion. This report gives an overview of what we can expect from Prime Day 2018 and how it is likely to compare to previous years.
The Origins of Prime Day
Amazon Prime Day was launched in 2015 as a promotional event to celebrate the company’s 20th anniversary. The event was so successful that Amazon has repeated it every year ever since.
During Prime Days, deals are offered exclusively to Prime members. As such, a major objective of the promotional event is to encourage shoppers to join the Prime membership program, which currently costs $119 per year (or $12.99 per month) in the US. Prime members tend to be higher-value customers for Amazon versus nonmember shoppers, as paying a membership fee tends to lock in customers, who look to get their money’s worth from the free shipping and other services that Amazon’s Prime membership program offers.
Amazon Announces a Bigger-Than-Ever Prime Day for 2018
On July 7, Amazon announced that this year’s Prime Day will start on July 16 at 12 p.m. PT/3 p.m. ET and will run through July 17, a total of 36 hours of promotional events. This is six more hours of events than for Prime Day 2017, which was 30 hours long.
This year’s event is anticipated to be bigger than ever: Amazon announced that it will offer more than 1 million deals worldwide and 50% more spotlight deals, including deal notifications from the Amazon app—Watch a Deal—and Alexa Shopping deals that are accessed by interacting with artificial intelligence (AI) assistant Alexa. Alexa Shopping deals will be further encouraged by the chance to win, for one grand prize winner, the Alexa Home-Smart-Home Sweepstakes and even an Alexa-enabled 2019 Lexus ES and a complete Alexa smart home package.
The focus of this year’s promotions will be on Amazon’s own devices, including its smart speaker/smart home Echo line and the company’s own-brand products in apparel and other categories.
This year, Prime members in Australia (where Prime was only recently launched), Singapore, the Netherlands and Luxembourg will be able to take advantage of the deals, together with shoppers in the US, the UK, Spain, Mexico, Japan, India, Italy, Germany, France, China, Canada, Belgium and Austria.
As well, for the first time ever, Amazon is taking Prime Day to brick-and-mortar stores, as US Prime members will be able to shop for deals at grocery retailer Whole Foods Market, which Amazon acquired in 2017. Prime members and Amazon Prime Rewards Visa cardmembers with an eligible Prime membership will be able to access discounts on hundreds of items at the grocery retailer.
Amazon Prime Day 2018: AI-Powered Echo and Private Labels Still on Center Stage
As with last year, Amazon announced that will continue to focus promotions during Prime Day 2018 on its own electronics and its own brands in apparel and other categories.
The company said that Prime Day 2018 will feature “double the deals” on Amazon devices, including Echo devices, Fire TV, Fire tablets and home-security devices.
We interpret the focus on promotional activities on Echo devices as a strategy in response to the surge in competition in the smart speakers/smart home space, especially from competitors such as Google with its Google Home devices.
Echo Dot—which was the best-selling device during Prime Day 2017—should remain a very popular item this year. At the time of writing, Echo Dot retails for $49.99. We can expect the price of Echo Dot to drop to $29.99, the all-time low that was reached on November 22, 2017 (during the Black Friday 2017 promotional period) according to price comparison website Camelcamelcamel.com.
Smart speaker Echo Spot will see its first Prime Day since its release on December 2017. The device, which features an embedded screen and camera for additional functions such as video calls, currently sells for $129.99 and could see significant price reduction during the promotional event. Another popular item this year should be Echo Show—an Echo device featuring a 7-inch touch screen—which normally retails for $299.99, but that Prime members can buy at $100 off starting from July 3 and until the end of the Prime Day promotional period on July 17.
Amazon private-label deals should feature extensively in promotions during this year’s Prime Day shopping event, as occurred last year. The company has announced exclusive offers on Amazon brands for Prime Day 2018, including 25% discounts on furniture and décor from Rivet and Stone & Beam, up to 20% off Amazon Basics items and 30% off everyday essentials from Presto!, Mama Bear and Solimo.
As it attempts to gain market share in new categories such as apparel, home and furniture and grocery, Amazon is building its own suite of brands, as we show in our report Slicing and Dicing Amazon’s Private-Label Offering.
During this year’s Prime Day shopping event, Prime members will also be able to access exclusive promotions on hundreds of new products such as Delta Trinsic Touch2O, the first Alexa-enabled kitchen faucet and Coleman RoadTrip LXE portable propane grill, to name a few.
Amazon Prime Day 2018: Another Record-Breaking Day Expected
With so many deals available, more ways to access promotions, as well as a longer promotional period, Amazon Prime Day 2018 is expected to break sales records. There is substantial interest in the shopping event among consumers. In the US, 76% of online shoppers are very likely or somewhat likely to visit Amazon.com during Prime Day 2018, according to a March 2018 online survey based on 1,015 respondents aged 18 or older, run by specialist news and data provider Digital Commerce 360.
Amazon does not disclose figures for revenues generated during Prime Day shopping events. We estimate that sales will reach $3.4 billion globally, a 40% increase compared to Prime Day sales estimates for last year, based on historical sales estimates for the three years to 2017 from specialist sources Digital Commerce 360 and Internet Retailer. Amazon’s plans for a bigger event, with more promotions and initiatives over a longer period, should support growth in Prime Day sales this year.
Amazon Prime Day 2017 Broke Previous Records but Was Surpassed by Cyber Monday 2017
Last year’s Prime Day, which fell on July 12, 2017, was Amazon’s biggest day in terms of revenues, according to the company. It said that sales surpassed those of Black Friday and Cyber Monday 2016, with total orders increasing 60% versus Prime Day 2016. However, later in 2017, Amazon announced that Cyber Monday 2017 was the single-biggest shopping day globally in the company’s history, surpassing Prime Day 2017.
Similar to this year’s event, promotions during Prime Day 2017 were focused on hardline products, such as electronics—Echo Dot was the best-selling Amazon device as well as the best-selling device by any manufacturer—and on its own apparel brands, with Amazon Essentials, Buttoned Down (men’s shirts), Lark & Ro (womenswear) and Mae (lingerie) dominating the deals in fashion.
As mentioned previously, aside from encouraging purchases through deals, Prime Day aims to boost the number of Prime memberships. There are no official figures on the number of customers that subscribed to Prime during last year’s shopping event, but we can assume that Prime Day 2017 was very successful to this end. In reporting for fiscal 2017, Amazon disclosed for the first time that the number of paid Prime subscribers exceeded 100 million globally.
Amazon Prime Day 2018 will start on July 16, 2018. This year, the company has announced a bigger-than-ever promotional event, with more deals and more ways for Prime members to take advantage of the discounts.
This year’s focus will be on Amazon’s own smart assistant Echo products and on new lines including home-security devices. We see the attempt to encourage purchases of smart home devices such as Echo products as a response to the surge in competition in the smart home space.
Likewise, we see the focus on promotion of Amazon own-brand items for Prime Day 2018 as a strategy aimed at gaining further market share in new categories such as apparel, home and furniture and grocery, in which the company is building its portfolio of own brands.
We anticipate that Amazon Prime Day 2018 sales will beat previous records achieved by past Prime Day shopping events. We estimate that sales during Prime Day 2018 should reach $3.4 billion globally. However, we can expect the actual figure to be even higher, as our forecast is based entirely on the statistical analysis of previous years’ estimates, and as such, does not consider the fact that this year’s Prime Day differs from previous years’, as it features more promotions for a longer period.