Amazon Prime Day 2021: Why is it Moving?

Updated: Sep 6

What is Amazon Prime Day All About?


Amazon Prime Day originally started in July 2015 as a 'thank you' to customers in honor of Amazon's 20th anniversary.


But timing is everything when it comes to promotional sales. And there's not necessarily any such thing as a perfect time when planning a promotional sale. They’re just as subject to circumstances as they are to tradition.


Believe it or not, branded holidays such as Memorial Day and President’s Day actually saw a dramatic decrease during 2020. While much of the decrease is the result of the pandemic, the staggering increase in digital commerce over the past 18 months can also be laid squarely at the feet of shrewd merchandising campaigns.


Campaigns don’t necessarily follow traditional sales calendars. Enter the game changer that is going to be Amazon Prime Day 2021.


The Impact of Amazon Prime Day 2020

Shopping for the lowest price on the best Prime Day deals

2020’s Prime Day may have brought in reported figures in excess of $10 Billion over just two days, but any promotion is only as good as the momentum preceding it.


Prime Day has name power alone. In fact, it’s become virtually synonymous with eCommerce promotions. Competitive offerings on other sites such as ‘Walmart Big Save Event’ and ‘ Target Deal Days’ have never quite matched the phenomenon that is Prime Day.


Amazon Prime Day, Strategy and Timing


But while customers could typically rely on Prime Day to occur in July, pandemic-related circumstances forced Amazon to move it later in 2020 to accommodate both merchants and customers.


It was a decision that paid off for the millions of Prime members hoping to shop Prime Day deals closer to Christmas. That's largely because the average Prime member is strategic in their shopping habits.


So why has Amazon chosen to host Prime Day early in 2021?


Prime Day 2021 and Amazon’s Q1 Performance
Prime Day sales and Amazon quarterly sales performance

Amazon saw sales revenue spike during the time period of the first quarter of 2021—a staggering $108.5 Billion compared to the first quarter of 2020, which saw only $75.5 Billion in sales.


While Amazon’s earnings may be largely driven by changing shopping habits as a result of the pandemic, Amazon’s announcement occurred almost six months after the FDA’s approval of the coronavirus vaccine; a development many analysts predicted could herald a pre pandemic return to brick and mortar shopping.


Amazon Prime members may have already learned to expect year round deals prior to 2020. The average Prime member might spend more time orienting their habits around Prime Day than outside of it. But that doesn't mean 2020 was anything other than a shift in the very face of retail itself.


And that didn't mean that A Prime Day deals would have been anything short of a digital shopacalypse.


Amazon Prime Day and the eCommerce Surge
A typical warehouse prior to the first week of Amazon Prime Day

Widespread adoption of digital shopping may have occurred well before the pandemic, but the surge in eCommerce during 2020 was unprecedented. Nor is it likely to relent. According to the UN Conference on Trade and Development, global eCommerce saw an increase in total retail shares of 19 percent in 2020, with both China and the US occupying slots in the two top tier markets.


Prime Day and Amazon’s Predictions for Q2 2021


Domestically, the US is predicted to reach its first trillion dollar year by 2022; and there’s every reason to suspect Amazon will be ahead of the fray. The retailer has predicted Q2 earnings to reach as high as $116 billion, exceeding Wall Street’s projection of $108.6 billion, and largely bolstered by the strength of Prime Day.


But is the momentum of Q1 the only reason why Amazon has chosen to host the event early?


Amazon Prime Day and Customer Expectations


Amazon Prime members tend to be shrewder than even many merchants expect. They know both the value of early Prime Day deals and they're not afraid to wear that value on their sleeves.


But Amazon also realizes that one of their chief strengths is keeping both customers and merchants on their toes. Whether it's price drops, big discounts ordelivery and fulfillment expansions, Amazon knows one key business principle: unpredictable times call for unpredictable strengths.


It's a strength which is just as applicable to Amazon Prime Day deals, as well.


Amazon Prime Day 2021: Have Consumer Priorities Changed?

A search for Prime Day deals with a member's Amazon Prime account

Despite the anticipation that life will return to normal in 2021, the digital economy is the new normal for many consumers. And what’s true for any economy, digital or physical, is also true for consumer priorities.


According to recent data, Memorial Day commerce saw a 20 percent loss in 2020 while the five days between Thanksgiving and Cyber Monday—long considered to be retail highlights—experienced a 9 percent loss. And the increased reliance on digital commerce in 2020 and the proliferation of non seasonal events may be one possible explanation.


Seasonality and Amazon Prime Day


But while the CDC has relaxed some social distancing measures in recent weeks, historically retailers have always hedged bets on summer being a relatively slow season. The Bureau of Transportation Statistics indicated that only 6.8 billion Americans made travel plans during the 4th of July in 2020 compared to 9.8 billion in the previous year. Yet July 2021 also coincides with the Olympic Games in Tokyo, offering viewers a glimpse of what life was like prior to the pandemic.


Amazon Prime Day and the Pandemic


While millions of consumers may hope that pre pandemic levels of physical activity will return with a vengeance in the coming months, there’s a stark reality we’re going to have to face. Many of us have become so accustomed to life under the pandemic that it can seem difficult to imagine a time when we weren’t self-isolated.


Summertime in 2021 is likely to be just as unpredictable as the entire year of 2020. Consumer priorities have functionally shifted over the past eighteen months, and merchants need to accommodate this shift. For brands and sellers alike on Amazon, that means adjusting to Prime Day and ensuring they’re eligible year-round.


What About Amazon Prime Day 2022?


There’s no reason to suspect that Amazon will orient their marketing solely around the month of July anymore. Retailers may rely on them as a reliable sales channel, but they’re becoming increasingly unpredictable in their solutions and their platforms.


Just like life after 2020. Except more constructively. Much more constructively.

 

Need help navigating the ins and outs of Prime Day? We’re here to help. Find out more at Color More Lines.

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