On Prime Day, Amazon keeps the focus on its marketplace
AUTHOR Daphne Howland @daphnehowland

But the e-commerce giant, more than either its third-party sellers or its rivals, probably got the most out of what may be the kickoff of the holiday season.

In its report on the delayed Prime Day sales event this year, Amazon kept the focus on its third-party marketplace.

Those sellers globally, in the 19 countries where Prime Day took place, took in more than $3.5 billion, making the event "the two biggest days ever for third-party sellers, nearly all of which are small and medium-sized businesses," the e-commerce giant noted in a blog post Thursday.

The company didn't reveal its total haul, but Digital Commerce 360 estimates it was $10.4 billion globally over the two-day period, up from $7.16 billion for the event in July 2019. In the U.S., eMarketer estimates Amazon's Prime Day sales rose 42.8% from last year to $6.17 billion. The year-over-year increase in the U.S. was significantly lower than in 2019, when it reached 65.2%. But that merely indicates how entrenched Prime Day has become, according to eMarketer analyst Andrew Lipsman.

"Growth rates naturally come down over time," he said by email. "It's harder to grow at very high rates once a certain level of scale is reached. It doesn't have anything to do with the timing of the event moving to October."

The pandemic forced Amazon to delay its big sale from its usual July date, but in a year when all retailers want to get a jump on the holiday season, the timing was fortuitous.

"Prime Day typically feels like 'Christmas in July,'" Keith Anderson, senior vice president of strategy and insights at Profitero, said on a Zoom call. "There's no question that this year, just given the timing, we saw demand pulled forward."

The rivals

But it's not clear how much that pull will affect the shopping season overall.

Bigger rivals like Target and Best Buy that held their own sales during the two days of Prime Day "yielded impressive results," especially on day one of the event in the U.S. and U.K., according to an email from digital marketing agency PMG. But that report also noted that "It is yet to be seen whether a notable halo will emerge to help kick off an early shopping season in the U.S."

Amazon captured the lion's share of spending in the period, according to an email from e-commerce research company Edison Trends, which found that Amazon took 91%, Walmart 4%, Best Buy 3% and Target 2%.

"Amazon captured 90%+ of activity on the event early on, dwarfing any contribution from Target and Walmart," Rick Watson, founder and CEO of RMW Commerce Consulting, said by email, citing Edison's findings. "This points to how smart Amazon is to 'own' their own events. They will always get much more benefit than other retailers."

For its part, Target said that sales grew by more than 2.5 times compared to last year, and its same-day fulfillment services were up nearly 300% during the event.

Amazon was able to keep the date in October under its hat for quite a while, making it difficult for competitors to plan, according to Profitero's Anderson.

And it's not just share or logistics in Amazon's corner. The e-commerce giant leverages the event to get more of its devices — Echo speakers, Kindle e-readers, Fire TVs and Ring doorbells — into households, engulfing those households into its ecosystem. And because only Prime members are privy to Prime Day's deals, it collects more memberships, again trapping more consumers into its sphere, Anderson said. (Amazon in its release didn't reveal how many people signed up for Prime.) Best Buy attempted to address that by limiting some price guarantees to its loyalty members, but that pales compared to Prime, according to Anderson.