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Bank of America Merrill Lynch estimates that retail sales grew 0.6% in July, compared with a prior Wall Street consensus of 0.4%, according to CNBC.
These analysts believe — based on data derived from BofA’s credit card sales in the period — that the uptick was largely driven by Prime Day, Amazon’s two-day sales holiday held on July 15-16 this year, which was projected to have raked in $7.2 billion globally in sales on Amazon alone.
Though retail sales have been growing slightly more than expected in the past few months after a downturn earlier in 2019, growth based almost entirely on Prime Day is another indicator of the brand’s dominance in the UBusiness Insider IntelligenceS market.
Prime Day’s impact is growing on an annual basis. The sale has grown substantially year-over-year: In 2018, Prime Day drove $4.2 billion in Amazon sales — 71% less than this year’s total — though the event was 12 hours shorter, per Internet Retailer.
That growth has propped up retail sales across the board: BofA and Merrill Lynch said that this year’s impact was "large" after more "modest" gains in 2018 and "negligible" spend in 2017 and 2016, per CNBC.
Though Prime Day’s impact on US retail sales likely came largely from Amazon, promotions from other retailers drove spending too. We conducted an on-site survey of Business Insider readers asking about their shopping habits on Prime Day. While the sample isn’t general population data, we think it provides a clue into consumer behavior around the shopping event.
- Most respondents shopped with Amazon for Prime Day — indicating that the promotion is working best on Amazon’s proprietary site. Fifty-eight percent of respondents shopped with Amazon, with over one-third (37%) spending more than $100 on the site during the Prime Day promotion. This was likely driven in part by free shipping — offered as a feature of Prime Day — and could help continue to grow sales in the future. Finding ways to channel sales will be important for Amazon because, although a wide audience is gaining access to the sale as Prime saturates the US market, subscriber growth is slowing and it’s getting harder for the e-tailer to sign up new members, which could temper growth in the future.
- But deals from other retailers are gaining traction and should continue to do so in the years to come. Other US e-tail giants, including Target and Walmart, offered their own deals during the event in an attempt to counter Amazon and bring in sales of their own. Amazon also incentivized shopping on smaller retailers in the days leading up to Prime Day through a promotion that offered customers an Amazon gift card for using its buy button, Pay With Amazon, on other sites. Twenty-three percent of respondents to our survey made a purchase from other retailers during Prime Day — not a huge share, but still substantive, considering that other retailers only began throwing their hats into the ring in 2018 — and those sales could have also contributed to the retail sales lift in the period. Now that these other retailers have a solid Prime Day under their belts, upping their efforts and investing more in promotions and deals during the period in the future could grow their share of sales and continue to boost US retail spending.
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