The massive success of Amazon’s Prime Day often shrouds the impact it has on outside retailers and brands. Luckily, many are finding creative ways to participate in the shopping holiday.
“It’s created an exclusive, ‘invite-only’ retail environment that we’ve never seen before,” said Stefan Weitz, the chief executive officer of Radial, an omnichannel tech and operations company dedicated to helping brands from Adidas to Bath & Body Works compete with Amazon. That exclusivity isn’t simply the result of requiring shoppers to join Prime in order to take part — many vendors are left out, too.
The Amazon wholesale brands taking part in Prime Day — which, this year, included Calvin Klein and Levi’s — must adhere to a long list of qualifications that can prove challenging. These include two-day delivery, having enough available product to last the timeframe (this year, it lasts 30 hours) and bargain-basement deals. “That’s not cheap for these companies,” said Weitz, who noted they must also give a cut of any sales to Amazon. In addition, many companies lack the level of operations savvy that’s required.
Indirect participation may actually be the best bet for brands, he said.
Michael Levine, vice president of marketing at Photon, a digital experience provider for Fortune 500 companies, agrees. Speaking from the offices of one of Amazon’s top competitors in the toy space, he talked about its strategy on Prime Day: “This company has hijacked the promotional power of Amazon, directed it toward their customers and offered deals on this day, too.” It was the second-largest selling day for the company last year, as a result.
Weitz’s clients, which include Kenneth Cole and DSW, saw similar results on Tuesday of this year’s Prime Day. Those that offered Prime Day–related deals saw an average sales increase of 328 percent, compared to the prior five Tuesdays, and a 318 percent increase compared to the average Tuesday in June.
“This has become a holiday for consumers, and they put it smack dab in the middle of the summer, when retail hurts the most,” said Levine. “They’ve enabled other retailers to leverage what they’re doing within their own stores, which the smart ones are doing.”
Indeed, Macy’s ran a “Black Friday in July” promotion on the same day, granting free shipping on all orders and up to 60 percent off sale items; Express dubbed it “Express Day,” offering 40 percent off all purchases; DSW offered 30 percent off all its shoes; and the list goes on.
“Clearly, based on the numbers, this is something retailers need to take part in somehow. It’s a big opportunity to attract customers,” said Weitz.
But that may not apply to smaller brands, which cater to a more niche audience, argued Levine. “It’s definitely more of a driver for larger businesses,” he said. “The impact [of Prime Day] on small businesses probably won’t be as strong as that felt by a category leader.”
Still, he cautions companies of all sizes not to blindly jump on the Amazon train or try to live up to Prime Day demands: “Always chasing after everything that Amazon does is a really bad idea — leveraging opportunities that they offer should be considered, but taking a moment to reflect upon your own brand is more important.”