Amazon Priming the Pump for Prime Day

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By Andrew Murphy of Loup Ventures

  • Amazon Prime Day — one of Amazon’s greatest inventions — starts on Monday, June 16th at 12 PM PT.
  • Prime Day 2018 will last 36 hours (+6 hours y/y) and will be available in 17 countries (4 more than last year).
  • We expect Amazon to continue ~60% y/y growth in units sold, selling 140M units on Prime Day 2018.
  • The company is also training customers to use new and differentiated shopping methods to tighten its grip on Prime users.

Prime “Day” 2018. The fourth annual Prime Day will begin on Monday, June 16th at noon Pacific Time and will last for 36 hours. This is a six-hour increase from Prime Day 2017, which also saw a six-hour increase from Prime Day 2016. Not only did Amazon invent its own holiday, but the company has expanded its duration and geographic reach since inception.

Amazon’s strategic deals. The company rolled out select deals on July 3rd, with additional exclusives and discounts released each day up to the June 16th event. The marquee deals include a $100 discount off the Echo Show (was $229.99, now $129.99), 50% discount on Prime Video, four months of Amazon Music Unlimited for $0.99, and more. In addition to the early start, Amazon announced that Prime Day 2018 will include deals on more than 1 million items worldwide compared to “hundreds of thousands” in 2017 and just over 100,000 deals in 2016. The company is also expanding Prime Day to four additional countries (Australia, Singapore, Netherlands & Luxembourg), bringing the total to 17 countries.

Source: Loup Ventures

 

Expect another record Prime Day. The two previous Prime Days both broke Amazon’s single-day sales record, a trend we fully expect to continue. Prime Day 2016 and 2017 each saw 60% y/y growth. This year we expect that number to be between 55-65% given the longer duration, additional geographies, additional deals, and the ongoing Prime Day campaign at Whole Foods. Note, however, that a Prime subscription ($119/year) is now $20 more than it was on Prime Day last year, and eventually, the law of large numbers will catch up to Amazon’s Prime Day growth.

Amazon is training Prime members. Amazon’s Prime Day Guide outlines a few ways customers can access additional deals to push new Amazon offerings. The Amazon app, Alexa, and Whole Foods offer unique ways to shop Prime Day. Using the Amazon Assistant browser plugin, customers get notifications on deals, plus $5 off any Prime Day order of $25 or more. Amazon is also offering a $5 discount on select Prime Day deals when customers use Camera Search on the Amazon app. Prime members shopping at Whole Foods will also receive 10% back on up to $400 when they use an Amazon Prime Rewards Visa card.

With Prime Day, Amazon is doing what it does best — value and convenience — to tighten its grip on the 100 million Prime Members, and counting.

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