Amazon Prime Day Early Insights From Numerator Show Shift To Gifting

Numerator, a data and tech company serving the market research space, has released early insights into Amazon Prime Day 2020 advertising strategies and consumer purchase intentions. This is a precursor to day-of insights that Numerator will release throughout Prime Day including verified spend, trip, item and basket metrics; shopper demographics; pricing intelligence; and verified Prime Day buyer survey data. The Numerator OmniPanel is the leading source of detailed eCommerce data, including Amazon, as part of a seamless view of consumer buying regardless of whether they shop on or off line. It is built on a technology platform enabling rapid access to data. 

Prime Day 2020
Amazon Prime Day, an event typically reserved for early July, is set to take place this year on October 13 and 14.  With the shift in timing, Prime Day is poised to capture a significant share of a holiday shopping season that will rely heavily on eCommerce due to COVID. According to recent Numerator surveys: 

• 54% of consumers indicate they will primarily shop online for the holidays — more than double that of 2019 (22%).
• 54% of verified Amazon Prime Members expect to purchase holiday gifts during this year’s Prime Day sale. This will likely dramatically shape the remainder of the holiday season, potentially shifting sales from Black Friday and Cyber Monday, and may also impact the types of products sold on Prime Day, shifting towards top gift categories.

Amazon is already advertising differently for this year’s Prime Day. In the two weeks prior to Prime Day for each year, Amazon ad spend is currently up compared to 2019 with different categories and products featured this year. Ads for Prime Day 2019 focused on Prime Video, AmazonBasics, Amazon Echo products, and Amazon Prime itself. This year, Amazon is putting more of their dollars behind gift cards (30% of pre-Prime Day ad spend, vs 1% in 2019), brand image (20% vs 0.4% in 2019), and Amazon Business (14% vs 0.3% in 2019) as work-from-home extends into the new year. 

Amazon 2020 Prime Day Ad Spend (two weeks prior) by Message

Prime Day 2019 Context
In past years, Prime Day has served as a catalyst for growth across Amazon’s core competitors who host their own sales events. Target and Walmart have already announced 2020 Deal Days and Big Save events respectively. While Amazon sales were up 4x on Prime Day 2019 versus the same two days (Monday/Tuesday) in the week prior, Target and Walmart each experienced a slight increase in in-store sales and a 10-20% boost to online sales. Kohl’s, Sally Beauty, and Bed Bath & Beyond offered competing deals, and saw even larger increases (+48%, +73%, +68%) as shown in the following table that compares 2019 Prime Day sales to the prior week comparable days: 

Prime Day is a catalyst for enrolling in Amazon Prime membership which creates year-round value for Amazon. According to Numerator’s 2019 post Prime Day survey:

• 3.9% of 2019 Prime Day shoppers signed up for Amazon Prime day-of.
• An additional 4.3% of 2019 Prime Day shoppers signed up within one month of Prime Day (meaning 8.2% signed up within one month of Prime Day).
• Over 1/3 (36%) of 2019 Prime Day shoppers were first-time shoppers of Prime Day.

Technology product sales typically surge on Prime Day, largely fueled by discounts on Amazon’s own private label products (Ring security, Fire TV, Fire tablets). These categories likely enjoy steep discounts as they all provide Amazon with the ability to gather additional data on its customers. In 2019, the index of household penetration versus prior year for key technology product categories shows:

• Safety & Security (Smart) – 482
• Assistants, Hubs & Speakers (Smart) – 311
• Headphones – 241
• Streaming Media Players – 236
• Tablets – 235