After getting rainchecked in July due to concerns about the COVID-19 pandemic, Amazon Prime Day is finally here! The two-day event, which starts on Tuesday October 13th, is looking like it may be the biggest sales event in Amazon’s history,
Here’s what we know about this year’s Prime Day and what we’re predicting will be the shopping event’s biggest hits and biggest flops.
Amazon’s fifth annual Prime Day will run from October 13th to October 14th (Tuesday and Wednesday) and will be held in 19 countries with a focus on supporting small businesses in many markets. Early deals have already gone live ahead of the event. For example, members in the USA and UK received an offer of £10 or $10 credit to spend on Prime Day as an early treat.
This year’s Prime Day event has big footsteps to follow. Last year, over 100 million paid Prime members participated in Prime Day, and over 175 million products were sold in 48 hours, making Prime Day a larger shopping event for Amazon than Black Friday and Cyber Monday combined. Tony Morales, Director of Advertising at Pattern, said Amazon is prepping itself for an event of similar scale this year.
“Amazon’s warehouses are packed to the gills,” Morales said. “Amazon is putting inventory restrictions on a number of sellers. They are positioning themselves to only hold the best, most desirable inventory, and happen to have the most of that.”
Morales anticipates this year’s Prime Day will be the biggest event Amazon’s ever had.
“The fact that Amazon is able to target their inventory to make sure that they’re only keeping in stock the things that they know are going to sell the best means that they’re going to have record sales, record profitability,” Morales said.
There are two main factors that make this year’s Prime Day different but also may help it hit record numbers. The first is that it’s happening at a time of accelerated demand in the ecommerce space, demand that you’ll recall caught Amazon off guard back in April and May and led to massive delays in shipping and product shortages.
“Amazon was expecting growth, but was not expecting growth at the pace that we have it because of all of the retail shutdowns,” Morales said.
More consumers than ever are purchasing products online and from the comforts of home due to the pandemic. They’re also spending more money and expanding the item set that they would regularly buy online, purchasing groceries and merchandise in the same basket, for example. This bodes really well for Prime Day sales and for prepared brands taking advantage of the amount of people who will be shopping online to push their own sales during the two-day event.
The second factor that gives Amazon a unique advantage over its competitors in all markets this year is the fact that the event has been pushed so close to Black Friday and Cyber Monday sales events. They’re six weeks apart.
According to Morales, Prime Day has had consistent but varying degrees of success for Amazon—in 2015, it was the biggest event Amazon had ever had, but in 2016, it was outpaced by Black Friday. Morales predicts that because these two events are so close this year, many consumers may begin their holiday shopping during Prime Day rather than waiting until next month.
“Because they’re close, we may see a more even matchup or maybe Black Friday doesn’t do as well as Prime Day, but we’ll know when we get there,” Morales said. “Given that these things are so close together, my guess is we’re going to have amplified traffic from mid-October through Christmas.”
Amazon is offering added incentive for consumers to do their holiday shopping during Prime Day with its extended returns window. Typically, Amazon’s holiday returns period runs from November 1st until after Christmas to give customers time to return products bought as gifts. This year, that returns period began on October 1st, making the idea of snagging a great deal on an early Christmas present extra appealing to shoppers.
Torsten Schaefer, Pattern’s new Country Manager for Germany, says that while competing retailers and marketplaces may try to match Prime offers, they will have a limited opportunity unless they are prepared to go out of stock on products just before peak. That puts Amazon in a unique position to pull big numbers.
The products expected to do especially well this Prime Day are big ticket items that customers are saving up for and waiting for a deal on. Apple watches, for example, are anticipated to be one of the biggest winners on Prime Day. TVs, iPads, Alexas, and Kindles will also do really well.
The consumer electronics, home and kitchen, and computer categories are expected to make the biggest wins on the platform, and when it comes to brands, Amazon’s private label brands, (like AmazonBasics), Apple, Samsung, and Under Armour are also anticipated to do really well.
Morales said he thinks PPE is another category that, due to the unique circumstances of COVID-19, will do really well this Prime Day, as consumers are still stocking up on masks and protective products during lockdown.
“I wouldn’t be surprised if people were putting wipes and hand sanitizers as stocking stuffers this year,” Morales said.
The categories expected to do the worst this Prime Day are movies and TV, with shows and movies doing especially poorly. Apps & games and automotive products are also showing low numbers.
Consumers have less discretionary and luxury income to work with due to the effects of the pandemic, and it’s expected that luxury goods will continue to hit lower numbers during Prime Day. Consumer search behavior has experienced major changes since COVID; read more on that here.
Examples of other subcategories that aren’t expected to do well this Prime Day are:
Prime Day 2020 is expected to do really well on a global scale. Schaefer, like Morales, believes Prime Day will be a success this year because customers have been waiting with anticipation for its announcement.
"Extra spending is possible as there have not been many deal events, and sales in offline channels are limited due to COVID-19. People have been told that Prime Day would not be cancelled, and there is also a three percentage point reduction in VAT until the end of the year in Germany," he said.
Pattern's General Manager for Australia, Merline McGregor, likewise believes that, although it’s been announced on such short notice, Amazon Prime Day 2020 is a welcome event for Australia's retail calendar: "With the state of Victoria still in lockdown, retailers and brands are seeking alternative channels to market."
Prime Day is happening right before Australia’s second Click Frenzy sales event of the year (the first was held in May), and it’s expected to sate pent up consumer demand for a sales holiday in that market as well.
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