Repeat shoppers drive record sales on Prime Day

July 19, 2016 04:27 PM Inc. dominates e-commerce as it is, but on Prime Day last week it accounted for 74% of all online sales in the U.S. that Tuesday, according to data from e-commerce analytics provider Slice Intelligence, which analyzed a panel of more than 4 million shoppers.

Shoppers who bought on Amazon on Prime Day spent more individually on average, but spent less per order. The average shopper spent $112—up 9% from last year—with an average order size of $54—down 2% from last year, according to Slice. Prime is Amazon’s $99-a-year service that comes with expedited shipping and other perks, such as streaming video and music and the ability to take advantage of special deals.

Amazon’s second annual Prime Day, held July 12 this year, proved to be the biggest single sales day in the company’s 21-year history, Amazon says. Slice’s data shows that frequent Amazon shoppers made it a record-setting day for the online retailer; 56% of all sales on Prime Day in the U.S. were made to shoppers who buy on Amazon at least four times per month, compared with 44% last year. Meanwhile, new shoppers actually made up a smaller percentage of overall sales this year (2%) than they did last year (3%). Amazon is No. 1 in the Internet Retailer 2016 Top 500 Guide.

Slice also found that 13.5% of all Amazon shoppers in the U.S. bought something on Prime Day, up from 11% last year. Overall, an Internet Retailer survey suggested that roughly 46 million Americans bought something on Amazon that day, and Amazon boasted a 46% conversion rate.

Amazon wasn’t alone in running special sales on Prime Day this year. An Internet Retailer analysis showed that 23 of the 50 largest online retailers were running some sort of special or limited-time promotion on Tuesday. Several, including J.C. Penney Co. Inc. (No. 33), Kohl’s Corp. (No. 19) and Macy’s Inc. (No. 6) declined to comment on their sales that day.

Not only did Amazon win the day when it came to sales on Prime Day, it also won on traffic growth.

Data from Hitwise, a division of Connexity Inc., showed that Amazon enjoyed the greatest spike in traffic on July 12 compared to the prior Tuesday at 57.3%. Here’s how other major retailers’ site traffic compared:

  • Macy’s Inc. (No. 6): 41.1%
  • Wal-Mart Stores Inc. (No. 4) 20.7%
  • J.C. Penney Co. Inc. (No. 33): 3.2%
  • eBay: 0.3%
  • Target Corp. (No. 22): -2.2%

While J.C. Penney posted the third-highest traffic spike at a fairly modest 3.2% gain, a company spokeswoman said the retailer will hold a competing promotion to Amazon’s Prime Day next year. This year, J.C. Penney held a two-day, online-only sale dubbed “Penney Palooza” on July 11-12 to coincide with Prime Day.

“We will continue to host an online sale during this growing online shopping week but at this time we do not have details to share on how long next year's sale will be or number of offers or the percentage discounts we will provide,” the spokeswoman says.

Some experts say retailers should focus their efforts more on other times of the year, rather than trying to go head to head with Amazon at its own game.

“We believe that competitors’ efforts to draft off of Amazon’s own proprietary holiday are going to be futile,” Slice writes in a blog post. “Instead of offering competing sales on and around Prime Day, retailers ought to consider creating a consortium-based approach (within the bounds of antitrust rules, of course) to create their own ‘ownable’ holiday during the summer.”

But not everyone shares that assessment.

Data from digital messaging intelligence vendor eDataSource shows that Amazon ran 181 Prime Day email campaigns between June 30, when Amazon announced when Prime Day was going to take place, and July 12, Prime Day. Amazon sent a total of 179 million emails, with an average read rate of 24%.

“If other retailers are going to attempt countering Prime Day, then they need to recognize that Amazon rolls out communications on events like these fairly early—June 30th this year, for their July 12th Prime Day,” writes John Landsman, director of strategy and analytics at eDataSource. “Prime customers received at least one email every day thereafter reinstating awareness of the event. It could therefore hardly have been other than top-of-mind of these customers.”

Click here for more of Internet Retailer’s Prime Day coverage.




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