Amazon is anticipated to smash sales records as cash-strapped Brits turn to the e-commerce titan for its blockbuster Prime Day.
Last year, sales during the discount bonanza hit a new record, raking in $11.2bn.
Now, the e-commerce giant will be hoping more discount-hungry shoppers than ever will be seeking out the best deals from Tuesday, as households’ budgets tighten.
With recent BDO data revealing that homeware sales dropped eight per cent in June as shoppers were wary about purchasing big ticket items, Prime Day will see the Seattle-based behemoth entice hesitant shoppers with huge discounts on electronics and home goods.
Big ticket or “near-future necessities” could be alluring purchases on Prime Day as shoppers become “more planned and considered” with their spending. White goods and back-to-school items have been pegged as the categories to watch.
Amazon may also see a decline in ‘nice-to-have’ impulse buys, according to Quantum Metric retail marketing director and former Amazon product manager Elissa Quinby.
“We’re seeing people prioritise spending on necessities and cutting back on everything else,” Quinby said.
Amazon has also got a second Prime Day in the works, later in the year, when energy bills will surge further amid the colder months.
Analysts predicted the next Prime Day would be around October and focus on gifting in the run up to Christmas.
“This move would indicate that Amazon is already anticipating consumers continuing to feel the pinch ahead of the festive season and is trying to get a greater share of consumers’ wallets ahead of the Black Friday/Cyber Monday sales,” Quinby added.
In the autumn, Amazon will also need to compete with the blockbuster Chinese shopping occasion, Singles Day. E-commerce rival Alibaba said shoppers spent more than $74bn on its shopping platforms over the week and a bit of discounts, putting Amazon’s 2021 Prime Day figures into sharp perspective.
Elevated living costs pose a “much greater risk” for brands than Amazon, Hugh Fletcher, head of consultancy and innovation at Wunderman Thompson Commerce, told CityA.M.
With six in ten consumers telling Wunderman they were more inclined to switch brands amid historic inflation, shoppers will flock to platforms with “access to a huge range of products” and “nowhere is better for range than Amazon,” Fletcher said.
Amazon is set to rake in some £1.4bn from UK sales alone, which would take small firms some 314 years to accomplish, according to analysis from Real Business Rescue.
However, spending over the rest of the year on Amazon could be impacted by the economic crunch.
Some 24 per cent of overall online spending was via Amazon this year, down from 27 per cent the year before, according to Wunderman research.
“While it remains the benchmark of experience and service, its grip may be starting to loosen as consumers shop from a wider range of sources, and social commerce rises in prominence,” Fletcher added.