Amazon Prime Day Tops $3.5 Billion

David Moin
·7 mins read

The sixth annual Amazon Prime Day surpassed $3.5 billion in sales from third-party sellers, marking an increase of more than 60 percent from last year’s event, the web behemoth disclosed Thursday.

The two-day event, held in 19 countries, was rescheduled from July to Oct. 13 to 14 due to the pandemic.

Amazon does not share the total sales figure for Prime Day, just the combined volume of third-party sellers, which are primarily small or midsized brands and retailers.

The timing shift was a major factor in the sales surge, enabling retailers and brands on Amazon to have more products ready for sale after experiencing COVID-19-related delays in shipments earlier this year.

Additionally, shifting to a later date closer to Halloween and Christmas meant there was more gift-purchasing in addition to self-purchasing. The shift to shopping online versus in stores has accelerated due to the pandemic and people being fearful of contracting the coronavirus in indoor spaces. The ongoing switch toward shopping online using desktops and mobile devices continues unabated.

For many retailers and brands participating with Amazon for Prime Day, it meant an earlier-than-ever start to holiday selling. So did the 10.10 Shopping Festival that involved about 100 brands, designers and retailers and a charity component, and ran from Oct. 9 to 12. It was launched by Coresight Research, Shopkick and Fashwire. There was also competition from Target’s Deal Days on Oct. 13 and 14 and Walmart’s Big Save event Oct. 11 to 15, while Kohl’s, J.C. Penney and Bed, Bath & Beyond triggered huge savings, new products and conveniences like contactless curbside pickups, and speedy deliveries, either in tandem with Prime Day or a few days ahead, all to encourage consumers to get some holiday shopping done early, and distract them from shopping the savings on Amazon. Aside from touting discounts, retailers made sure to remind consumers about the safety precautions being undertaken to reduce the risk of getting infected by the coronavirus.

This year, supply-chain pressures caused by COVID-19 will make it more challenging and more expensive for retailers to deliver holiday purchases. By pulling forward holiday spending, retailers can better manage promotional spending, inventory and delivery while providing a better experience for consumers,” said Deborah Weinswig, ceo and founder of Coresight Research, in a report.

“Consumers are also planning to start their holiday shopping earlier and our surveys suggest that they are wary of product shortages and shipping delays,” Weinswig added. “In our recent consumer tracker, three in 10 U.S. consumers said that they expect to start shopping earlier for the holidays, compared to last year. Many shoppers appear to be well aware of the pressures on shipping capacity, with 47.8 percent of early shoppers concerned about online orders being delivered in time.

Coresight Research prior to Prime Day indicated that seven in 10 respondents expected to purchase from or browse Amazon’s Prime Day promotions, and 26.7 percent would make a purchase on Prime Day. Four in 10 expected to purchase or browse promotions in the 10.10 Shopping Festival.

Michael Brown, partner at the Kearney management consulting firm, said, “It’s critical to start the season early, given what we know — store occupancy restrictions, shipping capacity shortage — and what we don’t know: will our workforce remain healthy? Will our suppliers be able to ship what we need? With a second wave of the pandemic possibly resulting in more store closures, retailers need to strike while they have the opportunity.”

Brown added that retailers starting holiday campaigns early will capture consumer spending while those consumers have the funds and the ability to shop freely. “They will also get a read on what consumers are shopping for compared to years past. Early reads will allow them to chase goods for December sales and act quickly to sell the slower-selling categories where they have built inventory. If they don’t act now, retailers stand to lose early data on consumer shopping patterns and sentiment, their fair share of limited dollars, and access to the most desirable holiday hires.”

Amazon’s Jeff Wilke, chief executive officer of Worldwide Consumer, in releasing the Prime Day results on Thursday, said this year’s promotion marked the “two biggest days ever for third-party sellers overall, nearly all of whom are small and medium-sized businesses.…Sellers saw record-breaking sales.”

Amazon said it designed this week’s Prime Day to support small businesses even more than in the past, including funding a promotion that helped drive more than $900 million in sales for small businesses in the two weeks leading up to Prime Day.

According to Amazon, its Prime members around the world saved more than $1.4 billion during the event, which provides discounts across many categories.

Top-selling categories during the event were bedding, wireless accessories, electronics, nutrition and wellness, crafts and sewing.

Best-selling products included the Echo Dot, Fire TV Stick 4K with Alexa voice remote, Roomba iRobot vacuum, LifeStraw personal water filter and Lego Star Wars Stormtrooper Helmets.

“We look forward to providing more opportunities for our selling partners to grow and customers to save throughout the holiday season,” said Wilke, though he didn’t cite any specific promotions coming up.

In the latest holiday 2020 sales forecast, Customer Growth Partners optimistically predicted a 5.58 percent increase to $749 billion in the November-to-December period from $707 billion in the same period due to rebounding retail sales, “resilient“ shoppers, a 5.4 percent growth in disposable income, low consumer debt, lower gas prices and employment growth. Digital and direct-to-consumer sales will amount to $189 billion, representing more than 64 percent of the aggregate increase in holiday sales.

CGP’s forecast was in stark contrast to an earlier and more uncertain forecast from Deloitte, that holiday sales will play out in two possible scenarios, a 0-to-1 percent increase or a more significant 2.5-to-3.5 percent increase.

However, Craig Johnson, president of CGP, did temper the auspicious outlook, citing “concerns for the millions still unemployed and uncertain prospects for additional COVID-19-related aid.”

“Twenty-twenty has been a roller-coaster for small businesses like mine, but Prime Day helped us sell a whole month’s worth of inventory in two days,” said Kennedy Lowery, from Live by Being, a skin-care and wellness company based in Houston, in a statement provided by Amazon.

Caron Proschan, from Simply Gum, a natural chewing gum and mint company in New York, N.Y., said on Day One of Prime Day, “We saw a 700 percent lift in units sold, leading to a record sales day for us.”

Another factor was Amazon’s spend $10, get $10 promotion in the two weeks leading up to Prime Day, which was offered by Whole Foods Market, Amazon Fresh, Amazon Go, Amazon Go Grocery, Amazon Books, Amazon Pop Up and Amazon 4-star stores.

Amazon gave a breakdown of bestsellers by country. In the U.S., bestsellers included the Roomba iRobot vacuum, the MyQ wireless and Wi-Fi-enabled smart garage door opener, the LifeStraw personal water filter, the Goli apple cider vinegar vitamins and the Kids Against Maturity card game.

In the U.K., some bestsellers were the Shark upright vacuum cleaner, Celebrations chocolate bulk box, Halloween party gag fillers and an Oral-B smart 6 6000N cross-action electric toothbrush.

In the United Arab Emirates, bestsellers were Listerine Cool Mint mouthwash, Sony extra bass smartphone headsets and the Nescafe Dolce mini-me coffee machine.

In Japan, bestsellers were SwitchBot, Detergent Wide Hiter, and Water Bottles I Ro Ha Su. On Amazon in Italy, the FIFA 21 PlayStation 4, Borbone Respresso coffee capsules and FFP2 by Jiandi protective face masks were big sellers.

Amazon said last month that it is creating an additional 100,000 regular full-time and part-time jobs in its fulfillment and logistics network throughout the U.S. and Canada. Amazon also strived to ship items faster. According to the company, more Prime members opted to have items shipped to an Amazon Hub pickup location versus last year.

According to Amazon, around the world there are more than 150 million members of Prime, which offers benefits like access to movies, music, books, magazines, games, as well as discounts on products, and same-day delivery on many items.

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