Major Amazon Prime Day Changes for 2023
As many will have heard, Amazon Prime Day is set for July 11 to 12. Along with confirming the actual date of Prime Day, Amazon announced a couple of major changes regarding Prime Day. Here's a quick summary of them.
Amazon Encourages Buying Direct from Brands' Websites (with a Catch)
In one of the more surprising moves, Amazon is also encouraging some consumers to buy directly from brands' websites instead of on Amazon. As most Amazon sellers will know, Amazon diligently deters shoppers from buying directly from a brand's website and prevents brands from promoting off-Amazon sales as well.
There's a catch though (as you might have guessed)—it's only applicable to a small number of brands, and they need to have the Buy with Prime payment method on their website.
Earlier in the year, Amazon expanded its Buy with Prime initiative (also challenging PayPal and Shopify payments at the same time) which allows Amazon customers to use their payment methods to purchase on external, off-Amazon, websites.
During this year's Prime Day, Amazon is pushing Buy with Prime even more by advertising early Prime Day deals directly on brands' websites (including Briogeo Hair Care, Anker, Wyze, and Pickleball Central). Consumers can browse all of the deals at buywithprime.amazon.com/shoppers
Presumably, this promotion to off off-Amazon Prime Day deals was some incentive for major brands like Anker to integrate Buy with Prime into their websites. It's not clear if brands are paying for this promotion in any other way, either as a fixed fee or as a percentage of sales.
New Early Access for Invitation-Only Prime Day Deals
The biggest change will be that Amazon is allowing early access to exclusive Prime Day deals that are expected to sell out such as 75% off the Amazon Fire TV 43” Omni Series.
To get access to the early invitation you need to be a Prime member, clearly one more attempt from Amazon to increase the perceived value of being a Prime member.
This strategy of offering early access is also one that has been used by other major e-commerce companies, most notably TaoBao in China which allows early access to Singles Day deals.
No Confirmation of a Fall Prime Day Event
Missing from Amazon's Prime Day press release though was any mention of a potential Fall event.
In 2022, Amazon held its first-ever autumn Prime Day event from October 11 to 12.
However, Amazon sent out emails to some sellers saying that it was accepting submissions for a “Prime Fall Deal Event” that will be sometime in the fourth quarter (presumably October).
Is Prime Day Effective for Sellers?
If you're an Amazon seller, this all leads to an important question—Is Prime Day effective for sellers?
In terms of overall gross revenue numbers, it's nearly universally accepted that most sellers appear to get a revenue boost during the event whether or not they hold any promotions. In our yet-to-be-released 2023 Amazon consumer survey, roughly one-third (33%) of consumers said they purchased something during Prime Day 2022. Now whether consumers are merely ‘saving their dollars' and spending less before/after Prime Day is not as clear.
In terms of profitability during the event, this is also not so clear. For brands not running any promotions during the event, their profit margins remain the same but they also lose out on a potential revenue boost by the added exposure of running deals. For brands running major promotions, generally this results in greater top-line revenue but whether or not this increased top-line revenue offsets the lower margins is really dependent on the brand, their margins to begin with, and how much top-line revenue increases.
Regardless of whether you're running promotions during Prime Day or not, all sellers should expect some changes in their normal order patterns leading both during Prime Day, from July 11 and 12, and the days preceding and after it.
