Amazon is ready to disrupt the retail landscape for the third consecutive year, as it
launches its July 11 Prime Day promotion. The company will offer thousands of discounted items and special promotions to reward its Prime customers and increase their numbers, while rivals scramble to maintain their decreasing share of the e-commerce pie.
"Our teams have been working for months to source exciting and interesting deals," said Greg Greeley, vice president, Amazon Prime. "Our fulfillment centers are loaded with products, our operations associates are ready, and our transportation partners around the world are excitedly waiting for the first Prime Day order."
Starting at 6 p.m. PT on Monday, Amazon will offer special curated deals on some of its biggest-selling items. The Amazon Echo smart speaker, powered by its Alexa assistant, will be available for 50 percent off, at US$89.99. The Echo Dot will go for $34.99 -- $15 off its regular price and the lowest-priced product among all the major smart speaker competitors.
Amazon will offer exclusive discounts, starting at 1 p.m. PT, to Amazon Echo, Echo Dot, Amazon Tap, compatible Fire TV and Fire tablet owners. Voice shoppers can find out about exclusive, early access deals here.
Amazon will give Prime members access to special Alexa deals through July 17, so they can verbally ask their device for Prime Day deals and get information by voice.
Prime Directive
For the past two years, Amazon has used its Prime Day promotion to disrupt the e-commerce landscape by offering massive discounts on some of its top-selling items and draw new customers to its Amazon Prime membership program.
During Prime Day 2016, which was the company's biggest-ever single sales day, company orders surpassed the 2015 promotion by 60 percent worldwide and 50 percent in the U.S., spokesperson Julie Law told the E-Commerce Times.
This year 40 percent of lightning deals will come from small businesses and entrepreneurs, including 25 percent savings on salt and pepper grinder sets from Willow & Everett, Amazon said.
Amazon, which recently agreed to buy Whole Foods for $13.7 billion, will offer up to 50 percent discounts on grocery items, including Wickedly Prime and Happy Belly products.
Televisions will be featured -- such as the Element 55-inch, 4K smart LED TV - Amazon Fire TV edition, priced at $399.99.
Amazon wants to achieve three main goals during the Prime Day promotion, suggested Paula Rosenblum, managing partner at RSR Research.
First, it wants to make some noise on a day when customers might rather be lounging on a beach than shopping, which is an age old retail gimmick, she told the E-Commerce Times.
Second, Amazon wants to drive membership to its Prime program, Rosenblum said.
Third, the company aims to drive revenue, she said, adding that it likely doesn't makes a profit on Prime Day itself.
At the end of the day, it is membership in Prime that builds loyalty and drives profits for Amazon, according to Rosenblum, "sort of like at warehouse clubs. They make most of their money on the membership fees."
Prime memberships stood at 85 million at the end of June, a 35 percent increase from a year earlier, according to data from Consumer Intelligence Research Partners.
About 63 percent of Amazon customers are Prime members, and they spend about $1,300 a year on purchases, compared to the roughly $700 a year that non-Prime customers spend, the data show.
Prime members shop about 25 times a year at Amazon, compared to non-Prime customers' average of 14 times a year, noted CIRP.
Amazon has continued to grow Prime membership by targeted less-affluent shoppers. Starting last spring, Amazon offered customers the ability to pay for Prime membership for $10.99 per month, rather than the $99 annual fee. Earlier this year, it began offering $5.99 monthly memberships to people on government assistance who have a valid Electronic Benefits Transfer card, a move that appears designed to go after Walmart's customer base.
Catch Us if You Can
Rival big box stores have been doing whatever they can to compete with Amazon in recent years, particularly Walmart, which may be Amazon's biggest threat following last year's acquisition of Jet.com.
Walmart launched two-day free shipping without a membership fee earlier this year and has begun offering discounts to customers who order online and pickup at a store, spokesperson Danit Marquart noted.
Walmart and other retailers have not attempted to make a big splash comparable to Prime Day, but they have put together some deals.
Best Buy will offer $150 off the 9.7 inch iPad Pro until Tuesday, and sell Google Home for $99 all week. Other deals include $200 discounts on Dyson vacuums, and $70 off the Apple Watch Series 2.
