The two-day Prime Day sale of Amazon.com Inc. this year is expected to be disappointing for bargain hunters as sellers look to minimize the discounts that into profit during times of soaring costs.
More on it
Tuesday and Wednesday’s annual events will be another clearance sale to clear the inventory and make room for new items before the holiday shopping season. Amazon is trying to sustain interest by showcasing millions of deals, including many on its signature products such as the Fire Television for $ 99.99 and Echo Dot smart speaker powered by Alexa for $17.99.
In 2015 Amazon launched Prime Day to attract fresh subscribers for $139 annually for getting discounts on products shipped. The event helped Amazon to lock shoppers before the holiday season and strengthen customer relations by offering deals on Amazon gadgets.
As per Bloomberg News, Consumer Intelligence Research Partners has revealed that Prime Amazon’s membership stagnated at around 172 million, remaining unchanged for six months, indicating that the $20 increase in February turned people off.
This is the second year that merchants selling around 60% of their products on Amazon to be stingy with discounts. Tim Seward, who runs ROI Revolution, an e-commerce consulting firm in Raleigh, North Carolina, says that Prime Day is an opportunity for aging inventories to be cleared out. He said 60% of his 160 clients offer moderate deal discounts. Though most brands offer lower discounts than 2021 because of inflation, it is an excellent way to clean the warehouse.
Shoppers are still expected to show up on Prime Day. According to eMarketer Inc., spending on Amazon in the 2-day event is expected to be $12.52 billion globally and $7.76 billion in the US, up 17% from 2021. Analyst Andrew Lipsman says consumers who are grappling with inflation and higher gas prices will look out for deals on household products they need.
Amazon is also struggling with rising competition from Target Corp. and Walmart Inc., which are hosting competition sales. Shoppers are habituated to moving from one site to another, seeking the best deals with the prominence of Amazon fading away.
The Chief Marketing Officer of CommerceIQ, Chris Bauserman, said that brands that generated three times the sales on Prime Day are expected to go down to double this year in an event which is still not to be missed though it is decelerating. The Palo Alto-based firm supplies e-commerce software to over 2,200 brands, including Whirlpool and Colgate.
Chad Rubin, Founder and CEO of Profasee, said that many Amazon merchants aren’t participating on Prime day, trying to protect their profits, saying that offering deep discounts and paying for Prime day advertisements is too expensive. Profasee is Miami based company that sells pricing software to online merchants.
