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How Amazon Prime Day 2020 Helped Small & Medium Businesses Thrive

If Amazon pioneered online retail, there’s no question that the phenomenon of Amazon Prime Day has reshaped the very way consumers think of retail itself. That doesn’t mean Black Friday is necessarily dead. It just means it’s increasingly minimal in comparison.

But there’s an elephant in the room with Prime Day. Namely, that top name brands tend to flourish often at the expense of their smaller and medium sized competitors. Much of that is simply based on name appeal alone. After all, it’s hard for the average consumer to resist a great deal on a premium brand name compared to a private label brand—even if the latter actually has a greater price advantage.

If the unpredictability of 2020 affected how consumers engage with physical retail shopping, it didn’t hinder eCommerce sales It drove them. Digital retail sales in the US spiked by an increase of over 40 percent in September alone. And as those numbers are only expected to increase as the holidays approach.

No one doubted that Prime Day 2020 was going to be an unmitigated success, with some forecasts predicting sales of close to $10 billion. But few predicted the impact it actually had on small and medium businesses.

Prime Day 2020 And The Third Party Seller Surge

Third party sellers on Amazon have historically contributed substantially to the Amazon ecosystem, with reported sales of $200 billion in 2019 alone. It’s a figure that made even Jeff Bezos stand up and take notice.

But third party sellers aren’t first party sellers. Amazon Marketplace sellers may have accounted for 58 percent of gross merchandise sales in 2018, but many consumers will frequently take advantage of Prime Day to save directly from brand manufacturers—not independent sellers.

That changed with Prime Day 2020. Not only did third party sellers see a sales increase in excess of $3.5 billion, it grew even more than Amazon’s total retail sales compared to the previous year. By almost 60 percent.

Why Small And Medium Businesses Thrive During Prime Day

The success rate of any small business in eCommerce is never guaranteed. The digital highway is littered with just as many casualties as it is with innovators.

But small businesses have one particular advantage in eCommerce: flexibility. And that fluidity is informed by personalization and direct insight into the needs of their customers. The average brand name manufacturer typically won’t have the time to directly respond to their consumer base. But a smaller business knows they can thrive only by offering a unique and individualized customer experience—one which simply can’t be attained anywhere else.

And customers react. Small businesses garnered over $68 billion in online sales in a 30 day period leading up to the 2019 holidays. The problem is that online shoppers have increasing expectations from any sized business. And those expectations are largely influenced by Amazon. Whether it’s free shipping, package bundle savings or next day delivery, Amazon doesn’t just fulfill those needs consistently. It’s one of their chief user strengths.

What Were The Top Selling Product Categories During Prime Day 2020?

According to Amazon, the two week teaser for Prime Day 2020 generated over $900 million in sales for small businesses, with Utah, California, and New Jersey seeing the largest market share. For independent third party sellers, the top selling categories included:

  • Bedding

  • Wireless Accessories

  • Nutrition & Wellness

  • Arts, Crafts & Sewing

  • Health Care

Keep in mind that while these specific product categories and their popularity generally tend to be consistent, 2020 has been anything but. And you’re likely going to find that 2021 will have a drastically change in customer interest as a result. Don’t be surprised if Prime Day 2021 will see a greater increase in essential items over nonessential and impulse purchases.

How Vital Was Prime Day 2020 For Small And Medium Businesses?

For any sized business, 2020 was marked by as many peaks as it was valleys. And that’s largely because its events have forced us to address our own changing perceptions about our shopping habits.

But for smaller and mid-sized businesses, the need for a proven model to effectively showcase product lines was never more fundamental than during 2020. Which is precisely what Prime Day is. Not a celebration of Amazon, but a model of how an online platform should be. A model of how customer experience should be. Can it be chaotic? Yes. Can you also sell several months worth of inventory in 48 hours? Yes. And that’s Prime Day’s strength. Effective marketing. Effective visibility. And more importantly, effective sales.


Color More Lines can help you drive more sales during Prime Day and beyond. We provide white glove, global account management of your eCommerce platforms so mission-driven companies can focus on new product development, branding and growth strategies. Find out more at Color More Lines.

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