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Flash Report

Amazon Prime Day

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Coresight Research

Key Points

Coresight has been covering Amazon Prime Day since it was launched in 2015 and additional reports from can be accessed here.

To celebrate its 20th anniversary, Amazon announced that it’s designating July 15 as Prime Day, an exclusive, global shopping event for Amazon Prime members. Prime members in the US, UK, Spain, Japan, Italy, Germany, France, Canada and Austria will be able to shop new deals, offered every 10 minutes, across a dozen categories, starting at midnight on July 15. The company claims that “Prime Day is a one-day only event filled with more deals than Black Friday.”

Thousands of Deals in Time for Summer Plans

Prime members will be able to shop a variety of deals on electronics, toys, movies, clothing, patio, lawn and garden, sports, and outdoor items. Many of these items are perfect for summer family road trips and back-to-school preparation. Unlike with Prime Now (Amazon’s two-hour delivery service), which is available only via mobile app, members can shop Prime Day deals via any device.

Prime Day Is a Day of Celebration

Amazon is positioning Prime Day as a celebration. The company has invited Prime members to use Prime Photo (the latest benefit of Prime membership) to enter a contest to win $10,000 in Amazon gift cards by submitting photos that reveal their “Prime moments.” Different photos will be featured in the days leading up to Prime Day, and shared on social media via #PrimeLiving. Also, Amazon has commissioned local artists in Toronto, Milan, Seattle, Berlin and many more Prime-eligible cities to create public art on the #PrimeLiving theme. These projects will be enjoyed both locally and online.

Prime Day Versus Singles’ Day: An Alternative Holiday

Amazon’s main Chinese competitor, Alibaba, debuted its Singles’ Day promotion on November 11, 2009, as a celebration of China’s bachelors. It has evolved into a gifting occasion for everyone in China. Last year, Alibaba achieved $9 billion in sales on Singles’ Day, up from $5.8 billion in 2013. To put these numbers into context, total sales for the four-day Thanksgiving weekend in the US were $50.9 billion in 2014 and $57.4 billion in 2013, according to National Retail Federation estimates.

Will Amazon Prime Day, the newest online shopping holiday, top Alibaba’s Singles’ Day sales record? It’s possible. Depending on consumers’ reaction, Amazon may also make the occasion a yearly event.

Analysts generally have a positive view of Prime Day. “Prime Day has the potential to become the next Singles’ Day and a truly global, online shopping holiday. It’s time to make shopping exciting again,” says Deborah Weinswig, Executive Director and Head of Fung Business Intelligence Centre’s Global Retail & Technology division. Sucharita Mulpuru, an analyst from Forrester Research, thinks that Amazon may be “trying to goose up their Prime numbers” because usually “they don’t do this mass marketing type of thing.” And American consumers are ready for another “huge blockbuster” online shopping holiday, said Mulpuru.

Prime Day Is Part of Amazon’s Strategy to Grow Prime Membership and Increase Profit

Last year, Prime membership in the US was up 50% from 2013, despite an increase in membership price from $79 to $99. Amazon’s management was “very comfortable” with this strong growth. Amazon Prime was one of the factors that turned the company to $214 million in profit in the fourth quarter of 2014, after a loss in the previous quarter.

Prime Day is one way Amazon is encouraging shoppers to sign up for Prime membership—if they sign up before July 15, they’ll be able to take advantage of Prime Day deals, and they can even set up a 30-day free trial. While the online video stream channel has the best Prime membership retention rate, Prime Day may attract additional members who could help keep the company profitable.

Source: Statista and company reports

Source: Statista and company reports

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