Everyone knows that Amazon is extremely focused on their customers. Prime Day offers them some incredible deals, but what is the real motivation behind this special one-day shopping event?
Let’s dig a little deeper.
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Amazon’s Sales Were Record Shattering.
On Prime Day 2015, 34.4 million items were purchased. That was more than any other day in the company’s history including Black Friday and members made 398 orders per second.
Do you like karaoke?
In the time it would take you to sing along to “Don’t Stop Believin’”, Amazon took in 100,000 orders. It didn’t stop there.
On Prime Day 2016, 74% of all U.S. e-commerce happened on Amazon and it was once again their biggest sales day of all time.
Here were the top 5 purchased items on Prime Day 2016.
- 215,000 Instant Pot 7-in-1 Multi-Functional Pressure Cookers
- 200,000 headphones
- 24,000 Double Hammocks by Vivere
- 23,000 iRobot Roomba 614 Vacuum Cleaning Robots
- 14,000 Lenovo laptops
While Sales Numbers Were Mind Blowing, It’s Never Been About Short-Term Profits.
Amazon has only just begun being profitable.
That’s because the real goal has been about building the Amazon Prime program and dominating the competition over the long haul.
The shocking thing is that is only 13.5% of Amazon shoppers shopped on Prime Day 2016, yet Amazon still added an estimated $500-600 million of incremental sales to their top line which was a record.
As we can see from the relatively small number of members who shopped on Prime Day 2016, Prime members are extremely valuable and your best customers will make you extremely competitive over the long haul.
It’s All About Acquisition.
Once customers enter the Prime ecosystem, things get interesting.
Prime members spend on average $2500 per year which is five times more than non-members. People who sign up for a free 30-day trial are converted into paying members 73% of the time and after one year, 91% of members renew for a second year. Once Amazon gets them in, they tend to stick around and engage a lot more.
To learn more about the value of Prime customers, check out our Prime Effect infographic here.
Prime Day Entices Customers to Join Prime.
In 2015, Amazon added 750,000 members on Prime Day. To help paint that picture, that’s more than the population of Alaska. More people signed up for a Prime membership that day than any other day before it.
Customers want to join so they don’t miss out on Prime Day, which is only available to Prime members. In 2016, Amazon launched over 800 different Lightning Deals which went well into the evening and more total deals than offered by Amazon on Black Friday.
What Does Prime Day Mean for You?
Based on the record shattering success of Prime Day over the last two years, it’s safe to say that it’s not going away.
Amazon has completely changed consumers’ brand expectations. Customer experience is now more valuable than ever and a premium loyalty program like Prime gives your customers immediate and lasting value so they stay engaged.
The best experience = the best customer.
To learn more about the things that were discussed in this infographic, drop us a line here.