Prime Day….the Results, Kind of

A success or flop? If anything, Prime Day stoked the social media chatter with such trending Twitter hashtags as #PrimeDay and #PrimeDayFails.

It seems some consumers were not overly happy with the quality of deals and that some deals were only available at certain times. Some folks questioned if Amazon was just cleaning out warehouses.
However, according to Amazon’s press release, it was a big success with customers ordering 34.4 million items across Prime-eligible countries. The VP of Amazon Prime commented, “Worldwide order growth increased 266% over the same day last year and 18% more than Black Friday 2014 – all in an event exclusively available to Prime members. Going into this, we weren’t sure whether Prime Day would be a one-time thing or if it would become an annual event. After yesterday’s results, we’ll definitely be doing this again.”
Some industry analysts suggest that Amazon missed an opportunity to emphasize benefits that come with Prime membership such as speed of shipping, video and music streaming, photo storage and e-book lending – much more expanded benefits than what other retailers offer with their own subscription plans.
But, Wal-Mart, which hosted its own sale the same day and also announced success, has something that Amazon doesn’t have right now – physical stores. A jab or PR ploy, take it as you want, but Wal-Mart indicated that Wednesday (Prime Day for Amazon users) was the highest day of the year for same-day pickup at its stores and orders increased “triple digits” over the same day last year.
Indeed, it’s the 2-day free shipping that is such a nice benefit of being an Amazon Prime member but it’s a costly one for Amazon with Forrester estimating that it costs the company more than $1 billion a year. However, according to consulting firm Kurt Salmon, the one-day sale encouraged customers to buy all goods at once which then allowed Amazon to save money on shipping. The firm further noted that the sale served as a kind of Black-Friday test run to help it prepare for other high-volume days.
Amazon is dependent on such delivery networks from UPS, FedEx, USPS and other delivery providers here in the US as well as other locations throughout the world.
So, how did Amazon’s delivery partners do? By all accounts, it appears all went well with a few hiccups scattered about. A few Twitter comments were concerned about 2-day deliveries not being delivered on time and/or rescheduled for Monday.
For the USPS, it was probably more of a struggle to juggle the packages in addition to the usual mail delivery but a key benefit it has over the two main delivery companies is that it delivers 7 days a week.
An interesting analysis of how it was expected to do on Prime Day can be found in the article “Is the Postal Service Primed for Amazon Prime Day?” In which the author estimates the USPS could see 12 million packages, roughly 20 times its normal Amazon volume and more than double its normal daily volume for all Parcel Select packages.
Likely we will learn more when earnings announcements start to trickle in. Estimated dates of these announcements are:
Amazon – July 23
UPS – July 28
USPS – early August
Wal-Mart – August 18
FedEx – September 16
So, as Amazon’s VP of Amazon Prime noted, the sale will probably return next year. Things will likely be different in 2016 as an analyst with NPD Group noted, “Christmas in July is not going to be new next year. It’s going to be repeated and embraced by more and more retailers.”
Other posts related to this topic:
Did Walmart Just One Up Amazon?
July 15th is Prime Day, Are the Couriers Ready?
comments powered by Disqus