During the month of July, it was nearly impossible not to hear talk of Amazon Prime Day, either through the press or the numerous emails the company sent to its customers. Now that Amazon Prime Day has come and gone, marketers and consumers are left assessing their views on the manufactured retail holiday. It is easy to focus on the negative; consumers berated the brand on social media; and much of the post-Prime Day press suggested that the event was a dismal failure. The truth, as it often is, is much more nuanced. In examining Prime Day marketing tactics and its aftermath, there are a few key takeaways for marketers.
LET’S EXAMINE THE FACTS
Amazon announced Prime Day on July 6th, just nine days ahead of the sale, to celebrate the company’s 20th anniversary. Prime Day was a one-day shopping event on July 15, 2015, with Amazon promising “more deals than Black Friday.” The real goal of Prime Day, of course, was to acquire new Prime customers. Industry experts estimate Amazon has somewhere between 30 and 40 million Prime customers. Those customers make twice as many purchases as nonmembers and spend 40% more per transaction, according to a recent ComScore report. In addition to growing Prime memberships, the event may also have been an offensive move to acquire as many new customers as possible at a time when the eCommerce space is more competitive than ever. Among others, Amazon is facing competition from the newly launched site, Jet.com, which officially opened for business on Tuesday, July 21st.
Amazon sent out 1 billion emails following the Prime Day announcement, with an average read rate of 23%
LET’S EXAMINE THE MARKETING PLAN
We all know Amazon to be a ubiquitous mailer, having sent out 1 billion emails in the 9 days following announcement of the sale, with an average read rate of 23%. Of those emails, 8%, or 78 million promoted the Prime Day sale by using subject lines that referenced the sale. Many of those emails were intended to build excitement about the event. Subject lines included, “Prime Day is coming soon!” which prompted 41% of the recipients to read the email, far better than the 23% average read rate the company typically achieves. Other email subject lines garnered impressive read rates of 51% and 52%.
A major goal of Prime Day was to encourage members to be more engaged with their accounts. Free shipping might be the most well-known benefit of Prime, but members also get instant streaming video, unlimited , ad free access to music, unlimited storage of photos, early access to deals, and free books on Kindles. In an effort to encourage customers to benefit from the full value of the Prime Membership, a big part of Prime Day was about getting customers to utilize its streaming music service; more than half the emails sent to promote Prime Day encouraged customers to play any Prime Music song for the chance to win $25,000 in Amazon Gift Cards. One such subject line read, “Customers are singing about Prime Day!” It was the most emailed email sent by the company, with an estimated mail volume of 30 million, but had a relatively low read rate of 14%. Other emails also encouraged customers to upload photos for the chance to win $10,000 in gift cards. While Amazon’s music and video services aren’t on the same scale as competitors Netflix and Apple, the real strategy might be in the devices that Amazon sells to work in conjunction with its services: The Fire Stick and the newly introduced Echo speaker, which retail for $39.99 and $179.99, respectively.
LET’S EXAMINE THE RESULTS
According to the media, Prime Day was much maligned in social media, with many shoppers frustrated that the most coveted items either weren’t on sale or sold out too quickly. Indeed, many best-selling items were not included in the sale, making consumers skeptical of the company’s claim that Prime Day deals rivaled Black Friday deals. Industry expert, Market Track, reported that just under 10% of their best-sellers in high-demand categories like tablets, televisions, toys & games, video games, laptops, digital cameras, and movies/TV shows were included in the event. The social media numbers tracked by Mintel tell a slightly different story. On July 15th there were 535K mentions of Amazon, a 78% increase from the day before**. Of those mentions, 66% were positive and 29% were negative. Some consumers were talking specifically about Prime Day, and Mintel tracked 148K mentions. Of those, 55% were positive and 38% were negative. Despite some complaints, customers focused more on shopping; Amazon said that by 1 p.m. the speed with which customers were ordering had surpassed 2014 Black Friday.
TAKEAWAYS FOR MARKETERS
By several measures, Prime Day was a success, although some things could have been improved. Consumers listened and were interested in Prime Day. Read rates for Amazon emails mentioning Prime Day or July 15th in the subject line were 10 points above average Amazon emails over the past week and are well above the retail benchmark of 15%. If nothing else, Prime Day communication increased brand awareness and attention, making Amazon top of mind for online shoppers. Another win for Amazon comes from being first-to-market. Being the first to offer this type of one-off holiday gives Amazon an edge, as consumers tend to tune out quickly.
While Prime Day was only a day long event, it opened the door for retailers across the nation to manufacture their own cyber holidays. Other retailers, including Walmart, are already jumping on the bandwagon to compete with Prime Day, creating their own summer sale days. However, it is important for retailers to remember that consumers will quickly desensitize to manufactured holidays, particularly if the discounts and deals aren’t better than those offered during normal sale times. Given the lackluster response to Prime Day, consumers will likely be skeptical of future retailer manufactured holidays, making it crucial for retailers to deliver on promises. Otherwise consumers will tune out. Delivering on promises is key.
*All email performance data tracked using Mintel ePerformance/eDataSource.
**All social media data tracked using Infegy.