Prime Day knocks it out of the park — and not just with record sales
Deena M. Amato-McCoy
Amazon’s third annual Prime Day was its biggest shopping event yet — and the biggest day in its history for signing up new Prime members.
The 30-hour shopping extravaganza for Prime members generated approximately $1 billion in revenue, according to initial estimates from analysts at Cowen & Co. and JPMorgan Chase & Co. (Some estimates put the total even higher.) Amazon itself did not provide hard sales numbers, but said that sales grew by more than 60% compared to last year’s event, with a "record number" of Prime members shopping across 13 countries.
Amazon said the event was its "biggest day ever," with sales that surpassed the retailer's results on Black Friday and Cyber Monday in 2016. It appears that Prime Day 2017 stayed true to its inaugural mission: to reward and retain Prime members — and lure new ones. Tens of millions of Prime members made a purchase during the shopping marathon — more than 50% higher than the prior year, Amazon said. It also said more new members joined Prime on July 11 than on any single day in Amazon history.
Among the deals snagged by shoppers included Callaway Golf products, headphones, Nintendo Switch consoles and premium brand 4K smart TVs. Amazon’s Fire TV was the best-selling TV deal in Amazon history, selling through record units in less than four hours, according to Amazon.
However, the most coveted category throughout the sale was Amazon’s Echo family of smart speakers. In fact, the event marked record sales in the U.S. and globally for the Amazon devices, including its Echo, Fire tablets and Kindle.
Prime members’ most popular purchase was the Echo Dot, which was on sale for 30% off. Besides being the top-selling Amazon device, the Dot was the best-selling product from any manufacturer in any category across Amazon.
“Amazon announced it sold seven times more Echo devices globally on July 11 than the entire 2016 Prime Day sale,” said Tom Caporaso, CEO, Clarus Commerce.
“These sales are an interesting indicator of how important Echo — and artificial intelligence-based devices in general — are for Amazon,” he added. “Echo customers already spend 10% more than non-Echo shoppers. Prime Day was a great way to introduce people to the Amazon ecosystem and get the device integrated into more households and the lives of customers.”
And Echo users were out in droves, using the speaker to place orders throughout the shopping event. “What Amazon does well is remove the pain points of shopping,” he added. “Voice commerce removes friction and makes it easier to place orders —which drives up sales for Amazon.”
The adoption of these smart devices proves that consumers are warming up to more solutions in the Internet of the Things (IoT) ecosystem — and the benefits they offer. From controlling functionality in a smart home to streamlining e-commerce orders,
“Echo Dot is paving the way for connected devices to become new e-commerce channels,” said Ofer Klein, CEO, Kwik. “IoT devices enable brands to build direct relationship with consumers to increase sales, loyalty and customer engagement.”
Eager to take advantage of the uptick in online traffic and shopper excitement, more retailers did get in on the action this year by launching competing summer sales. Traditional retailers like J.C. Penney, Kohl’s and Office Depot to online competitors Newegg and 1-800-Flowers.com were among the many brands that grabbed their own summer sale wallet share.
Where traditional retailers can get a leg up on the agile e-retailer going forward however, is to combine their online presence with their physical locations. The result is a differentiated omnichannel experience that drives customer convenience and instant gratification.
“Prime Day’s success is another wakeup call for retailers everywhere. So many other retailers still miss the point that order fulfillment is critical to customer loyalty,” said Nick McLean, CEO, OrderDynamics. “Not all retailers can offer the world’s biggest product selection, but many can combine their online and physical presences.”