The two-day sales event held annually by Amazon will again offer massive discounts across a vast array of products and in doing so recruit more shoppers into the Prime membership franchise.
There is no doubt that there are some great deals to be had. In 2020, Prime members saved more than $1.4 billion on a vast array of products. Last years Prime Day was a record-breaking event for SME’s too, with worldwide sales surpassing $3.5 billion—an astonishing increase of nearly 60 per cent YOY.
This year’s event has been timed earlier than usual in a bid to boost traditionally slow Q2 sales. This could be especially useful for Amazon, as the retail landscape starts to level out again and shoppers return to stores – thus removing like for like comparisons to last year.
But as e-commerce shopping festivals continue to gain traction in the region and inspire a change in tactics from all retailers, what can we expect to see from this year’s Prime Day?
- Amazon will not have it all to itself. As we’re seeing in other markets, retailers are quick to engage in a battle for consumer attention. Amazon will want to attract new members to its Prime offering, whilst appeasing existing members. Noon.com are competing strongly with their own ‘Big Yellow Sale’ over the same period (a sale that will last for 3 days). Furthermore, it will be interesting to see the nature of ‘deals’ on offer as Noon performed better than was expected in the ‘discount’ war of the last Black Friday.
- The breadth of offers on products will be far-reaching. We’ll see a diversification from the traditional deals on Electronics, to more deals on a much wider range of inventory. Last year we saw strong traction in top-selling categories including bedding, nutrition and wellness, arts and crafts, and health. This year expect to see deals across apparel, home and lifestyle and even more FMCG.
- Convenience will inevitably be a big factor in all Prime Deals. Prime delivery, same-day shipping and free international shipping will be offered to meet shoppers’ new post covid expectations around time, convenience and monetary savings.
- Amazon advertising will play a massive role in what we actually see on the site. With a new and heavy focus on sponsors – brands, products and display will see the highest bidder have their portfolio front and centre, meaning that what we’ll be shown is not necessarily be what we’ve been searching for.
All in all, whilst Prime Day will offer great opportunities for shoppers, the momentum around marketplace shopping festivals will continue to pose real strategic challenges for brand owners here in the region. After all, the aggressive need to chase eyeballs and sales by ‘fishing where the fish are’ can come at a cost to short term margins and long term brand equity.