Online shoppers are gearing up for Amazon Prime Day next week, and industry groups say a “halo effect” from the two-day event is poised to boost revenues for retailers of all sizes and types, from brick and mortar to other online stores.
A report from Adobe predicted that the Amazon shopping event will help lift the entire sector, given the strength of Prime Day in 2020, when, at $10.4 billion, online spending for the two shopping days surpassed that of Black Friday (at $9 billion) and neared Cyber Monday’s levels of $10.9 billion.
“As more retailers, both big and small, benefit from the halo effect of the shopping days by offering competitive sales events around the same time, Prime Day has catapulted the U.S. digital economy to new levels that now rivals the holiday shopping season,” said the Adobe Digital Economy Index report, released Wednesday. “Now in its seventh year, Amazon has successfully managed to grow its sale event year-over-year and shift consumer mindset to embrace a buying spirit during the manufactured shopping days.”
Amazon said in early June that its annual Prime Day will begin June 21 at midnight PT and go through June 22, with over 2 million deals for sale. Shoppers will find promotions in all categories, including fashion, electronics, home and toys.
Large retailers will capitalize the most from the hype of Prime Day, predicted the Adobe Digital Economy Index, which also said that 58% of consumers plan to shop on Prime Day, based on a survey it completed. Retailers with sales over $1 billion saw a 10% higher increase in sales online during Prime Day last year compared with smaller retailers, the report said.
Offering the option to buy items online and pick them up in stores will also benefit retailers, and those that send out targeted emails will be the most competitive.
In 2020, over 350 retailers promoted their deals alongside Prime Day, an increase of 17% versus Prime Day 2019, according to RetailMeNot.
“Shoppers can expect other retailers to jump on board and offer discounts to rival and match Prime Day deals with maybe even more breadth in categories to comp prior-year sales,” RetailMeNot said in a statement.
The average consumer will spend $594 on Prime Day with 44% of those surveyed planning to buy clothing, shoes and apparel, RetailMeNot said.
In May, U.S. consumers spent $75.3 billion online, according to the Adobe Digital Economy Index, an 11% decline from the year prior but a 58% increase from 2019 levels. As a result, Adobe said it expects 2021 holiday shopping spending to increase by 19.7% year over year, assuming sales strength remains similar to May’s levels.
And about 44% of consumers surveyed by Adobe said they plan to use Prime Day as a way to get a head start on holiday shopping, more so than for back-to-school shopping.
But according to RetailMeNot, 92% of people surveyed are likely to shop for back-to-school during Prime Day. Comparatively, in 2020, the timing of Prime Day, which took place October 13-14, created a negative effect on back-to-school sales, retailers surveyed by RetailMeNot said.
“The June positioning typically is a slow period for shopping demand, as it’s in between big shopping moments like Memorial Day and the back-to-school shopping season,” said RetailMeNot. “We expect Amazon will be successful this year as a very early kickoff for consumers to tackle their back-to-school shopping.”