Amazon Unstoppable Even in Face of Strikes

Amazon was hit by strikes in Europe as it geared up for its critical Prime Day sales period but it seems to have had little effect on the company’s performance

Amazon’s Prime Day sales has become a critical pillar in the company’s e-commerce operation, notching up incredible sales and becoming an event in its own right that the company also leverages to shift key products, such as its smart speakers and Alexa system. Its importance hasn’t just been recognised by the company but also the workers. They attempted to disrupt the event by staging strikes in Germany, Poland and Spain, with the former being Amazon’s second largest market. There were also technical glitches as outages in online access were reported by some users. However, this seems to have had almost no effect as Amazon has upped its market cap and dramatically powered ahead with sales.

Perhaps I understated the impact of Prime Day in that previous paragraph, as this year’s was the largest in the company’s history but also the largest shopping period the company has ever had! This is remarkable as almost every other consumer retailer in the US and Europe gears its entire sales strategy around the Christmas holiday period, and instead, Prime day (well 36 hours) was way ahead of the events it holds in those period, such as Black Friday. Here are some estimated numbers from the event:

All of this, even with strikes and technical glitches underlines Amazon’s technical proficiency and vast consumer base.

E-commerce companies need to sit up and take notice of this marketing, shipping and sales operation and take lessons. Amazon is leveraging this day to draw people into becoming Prime members, something that leads to high retention, largely driven by the offer of free shipping. The good news for other retailers, is that there appears to be significant spill over from the event as people shop around and are in the spending mood. Compared to an average Tuesday of sales, retailers with more than $1 billion in revenue saw a jump of 54% on the Tuesday of this year’s Prime day, according to Adobe Analytics data. Therefore, make sure you are also tuned into this shopping event and be prepared to stump up free shipping!

Indeed, Amazon is expected by most to become the first $1billion company by market cap and Jeff Bezos is now the richest man in the world.

You know what is even crazier? This might not even be close to the crest of the wave! In China, Single’s Day is a close equivalent, in that it is a created marketing and sales day by e-commerce giant Alibaba. In the 2017 iteration of this, spending reached $25.3 billion, dwarfing Amazon’s Prime Day and showing how much further there might be to go.

Alex Hadwick

Head of Research, eyefortransport

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