Prime Day: A good deal for shoppers but a great deal for Amazon


Prime Day: A good deal for shoppers but a great deal for Amazon

Today, Amazon is a bigger part of our lives than it has ever been before. A recent survey conducted by PWC found that a staggering 91% of UK shoppers use the site, with 38% beginning their product search there. Amazon’s growth is no secret, and in recent years we’ve seen the retailer make steady strides into grocery, with the launch of Amazon Fresh, Pantry and the recent acquisition of Whole Foods.

To facilitate its entry into the grocery market, over the last five years Amazon have built on its already strong ecommerce foundations by focusing more on technology development. Whether it be cloud based services, AI development or even distribution networks, they’ve become market leader in so many growth areas but for me, the most striking development is voice. It’s a space many have entered, but what puts the Amazon Echo ahead of Google Home, or Apple’s HomePod, is the potential to link this voice capability to commerce.

ComScore predicts that by 2020, 50% of all searches will be made via voice. And although voice isn’t as advanced as some would like, it’s already disrupting the grocery market and changing the way we shop forever.

So how does Amazon leverage this great potential? In the first instance, it needs to ensure that the Echo, which is thought to increase Amazon purchases by 10%, is adopted by as many shoppers as possible. Their third annual Prime Day event was key to this strategy.

Prime Day did two things. First; it was exclusive to Prime members and so generated a record number of sign-ups to the service, through a huge campaign that made the event unmissable. Prime is an important revenue stream for the retailer, but more importantly, Amazon know that the Prime shopper spends 3-4 times what the average Amazon customer does. By transforming their logistics and marketing strategies to boost sign-ups in ways such as the Prime Day event, Amazon are developing their existing client base and encouraging them to buy more products, more often.

Second; through making Amazon’s own product lines (particularly its Echo range) the star of Prime Day, Amazon drove record sales of its voice-enabled hardware. Amazon shifted +60% more product than last year, driven mainly by the Echo line. The Echo Dot sold out at a rate of thousands per minute and is now one of the highest selling items in Amazon’s history. So, the sales day drove sign-ups to Prime and encouraged adoption of the Echo en masse. In just 30 hours, Amazon single-handedly created a shopper base that has the potential to spend 50% more than the average Amazon shopper that made up this group just one day earlier.

Prime Day proves that there are huge benefits to be seen when a retailer takes ownership of an event. A discount day isn’t a new concept, least of all for Amazon, but by creating something new across a trading period that is otherwise quiet, Amazon have achieved total cut through, driving purchase and Prime sign-ups where there is a natural sales dip. Retailers shouldn’t be afraid to create events that work for them, their brands and their customers – even if they don’t fit into the regular calendar we’re used to seeing.

Some critics are saying though that Amazon looks like it is beginning to prioritise its own products at the expense of what the customer may really want.

Brands need to consider how they best partner with the retailer to drive their agenda in this new world, whether that be providing educational content like recipes through voice search, or maximizing presence during big trading events.

This is where Braun triumphed; products across the brand’s portfolio were central to Prime Day both onsite and in the ATL campaign that promoted it.

Amazon has always shown itself to be a disruptive force in the retail market and this doesn’t look like it will change anytime soon. It continues to win by applying an innovative technological lens to an approach that harnesses the best tactics from the traditional retail world, such as big sales day events and expansive distribution networks. Through combining established retail tactics with market-leading technology that grows influence and loyalty, Amazon continues to be a force to be reckoned with.