Amazon Prime Day has its work cut out for it this year — or does it?
In the five years since Amazon launched its annual mega shopping event, Prime Day has taken on a life of its own, becoming (much like all things Amazon) a disruptive force to the retail industry.
This year, as businesses of all kinds face unprecedented challenges, boldface retail names — Walmart and Target among them — are stepping up their efforts to grab their share of consumers’ shrinking discretionary dollars.
In the same week that Amazon announced the official date for Prime Day — to be held Oct. 13 and 14 following several coronavirus-induced delays — both Target and Walmart released news of their own sales events, with dates that unsurprisingly overlap with Amazon’s. (Target’s Deal Days will take place on Oct. 13 and 14 and Walmart’s Big Save event runs Oct. 11 to 15.)
While three major retail players hosting concurring sales events immediately conjures up images of fierce competition, experts are almost unanimous in their belief that the simultaneous sales extravaganzas will do little to put a dent in Amazon’s dominance.
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“People don’t realize just how much more traffic Amazon has than Walmart, which is at a [distant second place] in terms of online penetration,” explained Ryan Gellis, founding partner of tech services provider RMG Media, adding that Amazon has about 40% of market share in e-commerce and Walmart has roughly 5%.
“So, [Deal Days and the Big Save] are not going to make a difference for Amazon, but I do think it’s about time Walmart and Target [launched events similar to Prime Day],” he said.
For one, noted Gellis, both Target and Walmart have significant runway in terms of digital growth, and launching concurrent events with the industry e-commerce leader is an apt way to gain headway. Meanwhile, there is at least one area where both Walmart and Target already have a leg up.
“If I’m Target or Walmart, the key differentiator versus Amazon is that I have my physical store infrastructure to build on,” noted Gellis. “They should [ask themselves] ‘how do I leverage my online presence to draw foot traffic into the stores and drive impulse buys?’ They should be pushing products [related to activities] people can do at home. People are purchasing more furniture and exercise equipment and things like televisions and other electronics. There are still a lot of people across the country who are sitting at home in cities where restaurants, bars and movie theaters are closed.”
For what it’s worth, all three retail titans are offering a solid mix of deals across categories such as electronics, fashion and home. At Walmart — which at least has some advantage by starting its sales event before Prime Day and ending it one day after — merchandise to be discounted at The Big Save event will include Hunter boots for women; a maxi shirtdress from Scoop; a Roku media player; a Robot Vacuum; and an Instant Pot cooker.
What’s more, customers will be able to receive free two-day shipping on orders over $35, and select products can also get delivered the next day for free, while others are available for in-store pickup — the latter is proof the big-box retailer is leveraging its stores in tandem with the event.
Target, meanwhile, promises nearly 1 million more deals than it featured last year across home, apparel, accessories and electronics, as well as “Black Friday pricing” throughout the entire month of November. And it, too, is doubling down on several omnichannel initiatives: Nearly all of its holiday deals are available via its contactless Drive Up and Order Pickup services.
Amazon’s Prime Day is offering deep discounts on its private-label tech items such as the Echo, as well products from brands like Panasonic, Roborock, Keurig, Under Armour, Adidas and Lacoste. Categories include: toys, electronics, fashion, beauty, kitchen and home.
Whether these rivalries will significantly move the needle for their participants or not, Kim DeCarlis, chief marketing officer at web app security provider PerimeterX, said consumers — many of whom have been left cash strapped due to the pandemic — will reap the rewards of some especially red-hot deals this year.
“The good news is that this benefits the consumer, because they can choose between brands and ideally get great value,” said DeCarlis.
What’s more, noted both DeCarlis and Gellis, retailers are likely looking to do more than compete with one another as they approach a holiday season like no other— they are trying to combat the supply chain disruption that’s plagued many firms since the pandemic took hold in the United States in March.
“Many major retailers are trying to move the holiday shopping period forward by offering a variety of promotions,” said DeCarlis. “Given the increase in e-commerce traffic as a result of the pandemic, these efforts likely have less to do with competition than with distributing demand to help better manage supply chain and distribution challenges.”
Similarly, Gellis said he believes retailers are trying to “spread out” their inventory across the holiday shopping season to circumvent shipping delays and other supply chain hiccups.
And, as Farla Efros, president of HRC Retail Advisory, noted, it just so happens that supply chain strategy is another one of Amazon’s strong suits.
“Amazon has carved out such a niche in the marketplace — I don’t believe it can be broken down as of now and a lot of that is due to its reliability,” she said. “Retailers that try to compete, steal [from] or chase Amazon will be hurt. During these times, it’s best to stay in your lane and focus on what you are known for and do that flawlessly. The last thing you want as a retailer is to disappoint customers. In the past they might have been more forgiving, but today — given all the uncertainty — they want certainty.”