In the US, Black Friday and Cyber Monday are the most anticipated shopping days of the year. Retailers are known to pull out all the stops by delivering bargains that are hard to come by, while buyers are typically physically or digitally looking for the best deals.
Ecommerce Market Leader Amazon.com (NASDAQ: AMZN) debuted its Prime Day in July 2015 as a way to celebrate its 20th anniversary. The online retailer offered its members a variety of heavily discounted products and flash sales, billing the event as "Black Friday in July."
Each subsequent event was larger and more successful than the last one. Amazon has recently announced its fourth annual prime-day shopping event, which will begin at 1
Bigger than ever
Amazon promises the Prime Der Day (and half) will be "bigger than ever", expanding the event from 30 hours last year to 36 hours this year, offering "more than one million offers exclusively for Prime members around the world". Offers will be available in 17 countries this year, compared to 13 last year.
The company also says that "Prime Day offers twice as many deals as Amazon devices this year – and the largest offerings for Alexa-enabled products like Echo, Fire TV and Fire Tablets, in addition to new categories of Home Security to echo devices with screens. "It's not surprising that Echo devices are highlighted as echo owners tend to be some of Amazon's best customers.
One addition this year is the inclusion of Whole Foods, which Amazon acquired in August 2017, has a% discount of "hundreds of sales items in Whole Foods Market Stores, and deep discounts on selected popular products." For customers with the Amazon Prime Rewards Visa, the company increases the usual 5% cash back, doubling it to 10% for purchases at Whole Foods between July 14th and 17th for up to $ 400 in purchases.
Extension of Promotion
New at this year's event: "Hundreds of well-known and emerging brands around the world will be releasing exclusive new products, content and special edition products that are only available to Prime members for a limited time." Customers can watch these live events online.
In the days leading up to Prime Day, Amazon will also present exclusive offers and deals that are immediately available. These include $ 100 savings on the Echo Show, deep discounts on Amazon exclusive products, 50% off movies and TV shows on Blu-Ray, DVD and Digital, and special offers for various Amazon services such as Music, Twitch, Kindle Unlimited, eBooks and Audible.
Investors should note
Investors who want to understand the extent of this event need only review Amazon results. The company said the sale on its Prime Day 2017 will "overtake" Black Friday and Cyber Monday, making it the biggest shopping day in the company's history. Amazon then released the blow-out results in the third quarter of 2017, increasing sales year-on-year by 29% and outperforming its own forecasts. When CFO Brian Olsavsky was asked why he was better than expected during the conference call, he said, "I would not point out anything other than the Prime Day pickup … it was stronger than I probably expected."
Prime Day is not just about sales and appreciation of members, but also about winning members. Since only Prime members can participate in the specials, Amazon offers a free 30-day trial membership to encourage new members to join the Prime Day offerings. After last year's event, the company said, "More new members joined Prime on July 11 than on a single day in Amazonian history."
Amazon does not usually post a post that Prime for its business has generally assumed that Prime members spend more than non-members. Consumer Intelligence Research Partners estimates that Prime customers in the US spend $ 1,300 annually, compared to $ 700 for non-members. If this estimate is even close enough, Amazon has an interest in adding as many members as possible to the Prime program, and Prime Day is the perfect catalyst.
It's going to be a wild day (and a half)
Amazon has transformed an otherwise ordinary day into a global shopping event, creating a recipe for success for the company and its shareholders. Offering a one-day member-only offering is the carrot that persuades many new subscribers to join – and once they're on board, they become some of the company's most profitable customers.
Expect an update shortly after the event, but I think this will be another record-breaking shopping day for Amazon.
John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of the board of directors of The Motley Fool. Danny Vena owns shares of Amazon. The Motley Fool owns shares of and recommends Amazon. The Motley Fool has a disclosure policy.