Amazon’s (AMZN - Free Report) Prime Day event is going to be an extravaganza this year. To be celebrated over 36 hours, longest in the company’s history, the event is set to kick off on Jul 16 at 3 p.m. ET.
The annual Amazon Prime Day is an event similar to Cyber Monday or Black Friday. Started in 2015, it offers special deals including deep discounts on Amazon’s own products like Echo Dot, Fire tablet, the Kindle device and Happy Belly bottled water, among others.
Notably, Amazon Prime Day is only open to members of the Prime subscription service, which has crossed more 100 million of paid members globally (as of April 2018).
Last year, the 30-hour event turned out to be a blockbuster, marking the biggest shopping day in the company's history. As a record number of Prime members shopped across 13 countries, Prime Day sales jumped 60% year over year and reportedly generated $1 billion revenues.
Moreover, tens of millions of Prime members purchased items during the shopping event, up 50% from Prime Day 2016.
2018 Event Expected to Surpass All Records
This year’s event is expected to beat all records, primarily due to the length of the event as well as deep discounts in all products, including Whole Foods grocery items for the first time.
Amazon stated that Prime Day 2018 will feature “more than one million deals exclusively for Prime members around the world, plus select deals at all U.S. Whole Foods Market stores.”
Amazon has already started marketing campaigns to promote the event, apart from providing with mouth-watering deals. Reportedly, as a part of marketing campaigns, 25-foot boxes are expected to pop up in New York/Los Angeles, London, Tokyo and Milan. These boxes will open to reveal a pop-up event that will be live-streamed on Amazon’s website.
Meanwhile, in a pre-cursor to the main event, Amazon is offering great deals on apparel and accessories (starting Jul 9), Home furnishings, electronics and more (though Jul 15), and Everyday essentials.
Per data cited by CNBC data from One Click Retail, the 2018 Prime Day is expected to showcase 80 in-house brands from Amazon, up from almost 40 in 2017.
Amazon brands such as Stone & Beam, Rivet, Presto!, Wickedly Prime, Solimo, Goodthreads, Daily Ritual, and AmazonBasics are expected to make significant impact in this year’s event. This is primarily due to accelerating number of Prime members, who have been found to be more loyal toward Amazon’s in-house brands. The company’s strategy of launching new products frequently is also a key driver.
This year, Amazon is set to launch 30 new products from Rivet and Stone & Beam, as well as new apparel from brands like Isle Bay Linens.
Consulting firm PwC expects home and garden, apparel and accessories, and health and beauty products to be the top product categories in 2018 Prime Day.
Prime Program to Get a Boost
Prime Day is exclusive for the members of the Prime subscription program. The lengthy 2018 event and portfolio strength is expected to provide a further boost to the program’s subscriber base.
Notably, a large number of new members joined Amazon’s Prime on Jul 11, last year (2017 Prime Day) than on any other day in the company's history.
In 2017, the company witnessed five billion of item shipments via Prime services across the world. Amazon also announced that more paid members joined Prime in 2017 than any previous year, both worldwide and in the United States.
Further, per the Morgan Stanley estimates, Prime subscribers will account for 51% of the United States population in 2018, up 45% from 2017.
We believe that Amazon’s continuous efforts in making Prime more customer friendly will continue to drive subscription base of the service, which will eventually drive top-line growth.
Moreover, the service is expected to help Amazon improve its dominant position in the retail market space amid intensifying competition from companies like Walmart (WMT - Free Report) , Target (TGT - Free Report) and Kohl’s Corp (KSS - Free Report) .
Currently, Amazon has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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