With historically huge influxes of sales with Black Friday and Cyber Monday, let’s break down what happened in eCommerce this month!
Amazon Prime Day Review
A review of Amazon Prime Day 2022 and its effects on e-commerce.
Amazon Prime Day 2022 finished with a bang. This year, it took place on July 12th and 13th. Amazon has once again demonstrated its dominance of the e-commerce market leaderboard in the past 48 hours. Prime Day is Amazon's biggest sale of the year, and it applies exclusively to Prime members, with over 200 million subscribers. Consumers should note that the price of Prime membership increased from $13 to $15 a month (or $119 to $139 per year). This was to offset increases in labor wages and transportation costs.
Even before the dawn of the sales event, special early deals emerged, and other big box retailers also jumped on the sales wagon, directly competing with Amazon. This year, Amazon committed to supporting smaller retailers under the "Win Big by Supporting Small" initiative. Prime members can identify products from small business brands with a "Small Business Badge," including women-owned, Black-owned, and military family-owned small businesses. Shoppers who bought eligible small business products in the weeks before Prime Day had a chance to win prizes like tickets to the Super Bowl. Amazon reported that customers spent $3 billion on small businesses during the "Support Small Businesses to Win Big" sweepstakes.
Last year, online retail sales in the US exceeded $11 billion during Prime Day, according to data collected by Adobe Analytics. There was concern that Americans would spend significantly less this year during Prime Day than in 2021 due to the threats of steep inflation. According to data from Numerator, 83% of Prime day shoppers reported that inflation and rising prices influenced their Amazon purchases. This includes 33% of shoppers waiting to make a purchase until Prime Day sales and 27% passing on an item with a great deal that was not a necessity. But despite the concerns, Amazon shoppers still bought more than 300 million items this year, making it the biggest Prime Day event in history. Consumers are always looking for the next big trend to spend money on, and Amazon Live, the live-streaming service, had over 100 million views during Prime Day, with thousands of users hosting live streams. This year, total online retail sales in the US surpassed $11.9 billion during Prime Day, according to Adobe Analytics, which is reported to be 8.5% higher than last year's. As a result of the Prime Day event, the last two days of 2022 have been the biggest days for US online spending.
In the last few months, Prime membership has plateaued following the increase in the subscription price. This year, the majority of Prime Day shoppers have been Prime members for more than a year at 83%, and 75% have shopped at Prime events in the past. By introducing early deals and incentives like partnering with Grubhub, the food delivery app, Amazon hoped to bring in new members to help foster growth as e-commerce has slowed down compared to last year's overall growth.
Historically, Prime Day has served as a significant time to purchase electronics and tech, but consumer behavior is shifting to necessities over indulgences as prices increase. Trends among Prime sales this year included household items, electronics and technology, wellness, pet products, and more. Among the top five items sold, three were Amazon-branded electronics or gift card reloads, and two were household or grocery items. Household essentials have overtaken health, beauty, and electronics for the most purchased category, most likely because consumers are stocking up due to inflation. Groceries have also become more popular to buy online, with 17% of shoppers purchasing groceries from Amazon within the first day of Prime.
Products are costing more than they did a year ago. But there were still plenty of deals on technology, home, and lifestyle products. Customers were getting the best deal for their buck for the things necessary to their lives. Prime Day is the perfect opportunity before Black Friday and Cyber Monday to get discounts on more expensive items before the holidays roll around. These Prime Day results indicate changing customer behavior and have been impacted by inflation. Retailers should pay attention to how to gain new customers while also making updates to offset necessary costs.