Since 2015, Amazon’s Prime Days have been stealing July headlines and market share. COVID-19 may have delayed Prime Days until October, but it didn’t slow down sales. Total Amazon sales grew 45% from 2019 Prime Days to 2020 Prime Days, and sales for Amazon third-party sellers grew 69%, according to 1010data Market Intelligence.
During 2017 Prime Days, 3% of U.S. consumer spending (retail, restaurants and technology) was through Amazon. 1010data’s measure of consumer spending tracks retailers, restaurants, telecom and media, and travel and leisure spending. This year, that number jumped to more than 6%.
Amazon has doubled its Prime Days market share in just three years.
Online retail spending
Total online retail sales over the 2020 Prime Day period (October 13 to October 15) were the highest seen all year. In fact, sales during October 13 to October 15 were all in the top-10 selling days online since 2019, beaten only by Cyber Week 2019. October 14, the peak of Prime Days, was as big as Black Friday 2019.
Amazon not the only winner
While e-commerce retailers like Amazon were the primary winners, the heavy online traffic drove an overall bump in e-commerce sales across many sectors. E-commerce sales for apparel, footwear, beauty, pets and general merchandise grew at nearly the same amount in three days (October 13 to October 15, 2020) as they did the entire month of September 2020.
A Prime Days report would not be complete without a more detailed look at Amazon’s competitors. The heavy online traffic and sales across sites normally drive an overall bump in e-commerce sales. 2020 saw a similar bump in sales, but a few things were different.
We already know that COVID-19 has been driving e-commerce sales growth all year, as lockdowns forced shoppers online. Amazon sales were up more than 30% in their second quarter (company reported figure), but Walmart e-commerce sales grew 97% and Target digital comparable sales rose 195% (company reported figures). With all that growth, competitors were clearly more prepared for their own Prime Days events. Walmart hosted a “Big Save Event,” Target had “Deal Days,” and Best Buy even shifted the calendar by a month for a “Black Friday” event.
Best Buy’s naming convention was the most noteworthy. By delaying Prime Days until October, Amazon pushed much closer to the important holiday shopping season. Companies were always unhappy to lose sales to Amazon in July, but they were unwilling to concede customers just a month before Black Friday.
The competition therefore took a toll on Amazon. While Amazon gained market share of total consumer spending, it lost share versus major competitors, resulting in Target and Best Buy being big winners. Walmart and Wayfair were not far behind. In fact, the changes look a lot like the rest of 2020 — as more consumer spending happens online, more competitors are finding niches against Amazon.
For store-based retailers, buy-online-pick-up-in-store (BOPIS) has become a competitive advantage that Amazon is chasing to match with Amazon Hubs.
What is interesting to note about Home Depot sales is they have continued to gain share during the pandemic through in-store traffic rather than online. Home Depot stores have been open throughout the pandemic, have large aisles and have customers who still need help from in-store associates or want products immediately.
So who’s doing the shopping?
Amazon has a loyal group of Prime customers ready to act during Prime Days. The average Prime Day shopper in 2019 spent 2.7 times more money from June through August than Amazon shoppers who didn’t spend during Prime Days. Even if you remove Prime Days from that spend, Prime Day shoppers still spend 2.5 times more money over that same time period.
Despite neither competitor having so dedicated a base as Prime members, Walmart and Target are not far behind at getting loyal customers to spend more money. The customers who shopped Target.com during Prime Days spent twice as much money from June through August 2019 as those who didn’t spend on those days, and Walmart.com customers spent 1.5 times more. The people shopping midsummer deals around Prime Days at online retailers are typically some of the most active customers of those sites. Prime Day customers spent twice as much money as other Amazon customers in September and October before Prime Days 2020.
Overall, Prime Days proved to be an effective promotion for the marketplace at large. The question to follow is, how will this “early start” impact overall Black Friday promotions and holiday sales?
Andy Mantis is head of data insights at 1010data, a leader in analytical intelligence and alternative data. He can be reached at [email protected]