Did we bet right for Prime Day 2019?
In anticipation of one of the largest online shopping events of the year, we released predictions for how Amazon would squeeze the most out of Prime Day 2019. Now, let’s see how we did…
Prediction #1: Amazon will boast convenient shipping capabilities
We predicted that Amazon would push fast-shipping capabilities for Prime Day 2019 in order to increase consumers’ average annual spend and stay competitive with its competition.
In a Prime Day first, Amazon pushed free next-day and one-day shipping for more than 10M products.
This reflects a clear effort that Amazon is trying to be as convenient as possible. Through raising the bar on cultivating instant gratification, consumers develop a higher standard for what they want in a retailer.
Prediction #2: Amazon Store Card Credit Builder will be the catalyst for new Prime members in the U.S.
Verdict: Not totally off
As Amazon enters market saturation of Prime memberships in the US, we predicted that the Amazon Store Card Credit Builder would fulfill the missing gap and appeal to non-Prime members who view Prime membership as too costly. This strategy would enable Amazon to appeal to the lower-income consumer and make it more competitive to direct competitor Walmart.
While we saw Amazon promoted 6% cashback on Prime Day for the card, the promotion was not eligible for users that enabled financing options. Despite the restrictions, retail cards are known to be beneficial for those with lower credit, as it’s easier to get the card; Amazon’s promotion was still an effort to gain more varied consumers in its ecosystem.
Prediction #3: Amazon will make room for Apple sales among its Amazon-branded products
We predicted Amazon would share the stage with another tech behemoth, Apple, to ensure greater revenue from Prime customers. Apple became a verified re-seller for its refurbished products on Amazon in November 2018, so Prime Day 2019 was ample time to promote Amazon’s vast and high-quality library of products through discounting Apple products.
Our bets were spot on, as Apple deals were among the main highlights for Prime Day – iPads and Apple Watches were 30% off.
Apple is a main competitor for Amazon’s devices, and this amiable move showcases where Amazon’s priorities are. While Amazon could have just focused on selling Fire and Alexa devices, selling Apple products helps boosts Amazon’s retail presence and reputation: If consumers can buy Apple products on Amazon through a Prime membership, why go anywhere else?
Prediction #4: Amazon will promote its pharmaceutical product offering
Verdict: No, but not totally off
We predicted that Amazon would incentivize Prime members to switch prescriptions to Pillpack with gift cards or discounts. Amazon acquired Pillpack in 2018 and has quietly made moves to enter the healthcare space by expanding its pharmacy licenses in new states and announcing FSA and HSA payment options.
Our prediction didn’t come to fruition. While Amazon did utilize display ads for Pillpack on its retail site, incentives to switch prescriptions were nonexistent. However, we believe our prediction was a little premature.
Consumers are eager to save money and simplify healthcare, but the majority of decisions are made in the fall for the following year. Amazon offered a glimpse of what is to come through its display advertising, but we instead expect Amazon to take advantage of the upcoming annual enrollment period to promote Pillpack when healthcare is top of mind for US consumers. Expect awareness efforts to remain strong into early 2020 when new plan stipulations begin and consumers reevaluate their pharmacy options.
What we think
Once again, Amazon has proven to be resilient in the face of criticism and is setting the curve for what people expect out of a retailer. Through its evolved shipping capabilities and exclusive Apple promotions, Amazon remained competitive against increasingly innovative competition. Their efforts elevated the Prime brand as a whole, justifying that Prime Day is a showcase of a membership- more so than just a summer sale.
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