Prime Day 2024: Why does every store from Walmart to Target have its own version?

Did you enjoy Target Circle Week last week? Or Walmart’s July deals? TikTok Shop just had its Deals For You Days from July 9 to 11, while This Week, which runs through July 18, slashes prices by up to 90 percent. Now, this week, Amazon Prime Day is here. This all happens right after retailers’ Fourth of July holiday sales, turning the entire month into a blur of deals. Time to shop, because there’s never a time not to shop.

None of this is a coincidence. Like when big-box retailers suddenly announced they were finally lowering their grocery prices to combat inflation, business strategy 101 is responding to what your competitors are doing. July has become the season of big sales, because no store wants to be the one selling an air purifier at full price when Amazon has it 25 percent off.

Amazon’s famous Prime Day sale is in many ways a testament to the e-commerce giant’s power: It invented a new holiday — now twice a year — that consumers have begun celebrating every summer and fall. It’s still the season’s main sales event, with Megan Thee Stallion rapping about how much she loves Prime in a commercial, but competitors are trying harder to steal its spotlight — and it’s working. A new report from research firm eMarketer predicts that Amazon’s share of all online purchases made between July 16 and 17, when Prime Day takes place, will decline for the third year in a row. That’s a testament to other retailers’ success in getting customers into their stores. Prime Day is still a 48-hour sale period — but not just for Amazon.

The inaugural Prime Day was a one-day sale on July 15, 2015, held to celebrate Amazon’s 20th anniversary and billed as bigger than Black Friday. It was a clever marketing move—rather than competing only during established holiday sales seasons, Amazon carved out its own moment in the middle of summer. (Walmart immediately announced its own July sale that same summer.)

Prime Day also served as a huge billboard for Prime, which had 40 million members by 2015, according to research firm Consumer Intelligence Research Partners (CIRP). There are now about 180 million Prime members in the U.S., CIRP estimates, which is a little more than half the country’s total population. This nation of loyal Prime subscribers has helped transform Amazon, for many years a textbook case of an unprofitable tech company, into a behemoth. In the first quarter of 2024, the company reported net profit of $10.4 billion.

The original Prime Day deals were apparently a bit of a letdown compared to the hype — they hyped up a lot of Fire TV Sticks, still the staples of Prime Day — but Amazon still sold about $900 million worth of merchandise that day. Since then, consumers have given Amazon billions more on Prime Days, reaching a record $12.7 billion in a 48-hour period last July.

“I think Amazon is pretty much sticking to its tried-and-true Prime Day playbook this year,” says Sky Canaves, principal analyst at eMarketer. That means offering great deals, which in turn drive more Prime sign-ups. Some of the biggest discounts this year are invite-only deals from big brands that only Prime members can access: a Peloton bike is 30 percent off, a pair of Sony headphones is 55 percent off, and a Citizen chronograph watch is a whopping 60 percent off.

You can also expect to see a lot of beauty products on sale. “Amazon has been bringing in more premium brands this year, especially in categories like beauty,” says Neil Saunders, managing director of retail at consultancy GlobalData. Clinique, for example, recently launched on Amazon, joining the ranks of popular beauty brands like Dermalogica and Laneige that are already on the platform.

With Prime Day, Amazon has introduced a new calendar event to the lives of American consumers. The problem is that when everyone is having sales in mid-July, those sales lose some of their luster.

Prime Day “used to be bigger,” says Michael Levin, a co-founder of Consumer Intelligence Research Partners. “People have gotten a little more used to it,” he says, both because Amazon added a second Prime Day event in October, starting in 2022, and because all of its competitors have started to follow the Prime Day rules. “I think the general excitement has died down,” adds CIRP co-founder Josh Lowitz.

The fact that Prime Day sales growth has slowed significantly may reflect that acclimation. Prime Day revenue last year was 6.7 percent higher than it is in 2022 — still growing, albeit slowly. But in 2018, the sales event brought in a whopping 78 percent more revenue than the year before, according to a report from Capital One Shopping. Google Trends data also shows that “Prime Day” searches peaked around July 2018.

Amazon itself is partly responsible for dampening Prime Day fervor. Not only do they have multiple Prime Days a year, but they also had a big sale event in the spring that was open to all customers, not just Prime members, and they also ran smaller, more category-specific sales. “Those extra sales can have a little dampening effect on Prime Day,” Canaves says.

Amazon probably doesn’t mind, since more frequent sales mean it can take advantage of smaller, more frequent purchases on its site, whether it’s beauty products or dietary supplements, which come with a handy auto-replenish option. It’s not even Prime Day at the time of writing, but Amazon already has a ton of “early” Prime Day deals, which further blurs the lines of when the sale really starts and ends. Even outside of the big sales, products on Amazon are often marked down, with prices fluctuating millions of times a day. A Le Creuset Dutch Oven in cherry is currently on sale for $297 instead of $460, and it’s not marked as a Prime Day deal. Websites like Camelcamelcamel or Keepa make it easy to set up a price drop alert that you can set and forget about instead of waiting for a sale event to start. According to Keep, these Levi’s jeans get an average of six price cuts per month, the Coway air purifier gets about eight cuts per month, and Premier Protein Shakes — a top seller during Prime Day in October 2023 — gets a whopping 32 cuts per month. If you miss a good price, don’t worry. Just wait a few minutes.

Online retailers have come out in force to offer their response to Prime Day — and Amazon is clearly keeping an eye on the newcomers hot on its heels. The Information recently reported that the US e-commerce giant is launching a cheaper clothing and home goods section with slow shipping directly from China, in a similar fashion to Temu.

Amazon has long been synonymous with convenience: You can buy stuff with a single click and have it delivered, sometimes the same day. It makes sense for customers to offer a new, slow shipping option if they want it, but it’s also a partial capitulation by Amazon that perhaps consumers NO they basically need lightning-fast delivery of everything. Price is king, and Chinese e-commerce companies like Temu that are making inroads in the U.S. have an advantage here. Whether you shop on Amazon or Temu, whatever you buy probably came from a Chinese seller.

Another area where Amazon’s competitors have an advantage is making shopping fun. “We like to say that Amazon is a better place to buy things than to buy things,” says CIRP’s Lowitz. “If you know what you want, Amazon is a fantastic place to buy. It’s easy and reliable.” It’s not a great store when it comes to discovering new products that catch your eye. To buy something on Amazon, you first check out shopping blogs, Reddit commentary, Wirecutter and TikTok influencers to find the best finds. That’s where Temu and the newer TikTok Shop come in. Chinese e-commerce retailers tend to be “driven by discovery, not search,” Canaves says. Amazon has tried to incorporate some of TikTok’s social shopping aspects into its platform, including a scrollable feed of shoppable products called Inspire and live shopping, but those features haven’t made much of an impression.

Amazon is by far the largest e-commerce operation in the U.S., but that doesn’t mean it shouldn’t be concerned about other, much smaller retailers. “Collectively, the new entrants — Temu, TikTok Shop and Shein — If “having an impact on sales,” says Canaves.

Amazon has become an unstoppable force over the past few decades. But maintaining its dominance as the Everything Store may be the biggest challenge the company now faces, according to Lowitz. Amazon sells everything, but is it better at ultra-cheap fast fashion than Shein? Better at furniture than Wayfair? Better at pet supplies than Chewy? Better at groceries than Walmart?

One competitor may not be a huge dent in Amazon’s dominance, but it all adds up. The evolution of Prime Day is a case in point—Amazon may have started it, but now it’s every retailer’s Prime Month.