Will Amazon Prime Day take Prime membership to the next level?

Amazon Prime Day, the e-commerce platform’s (AMZN) annual day of price cuts, starts today and will last until tomorrow, Wednesday, July 17.

eMarketer’s Chief Retail and E-Commerce Analyst Sky Canaves joined Wealth! to share his insights on what Amazon investors and regular customers can expect from this year’s Prime Day and the biggest deals across multiple product categories.

Canaves says Amazon will stick to what it has done before: “Offering these great deals and benefits for Prime members to emphasize the value of Prime membership and drive more sign-ups. And that continues to work. We forecast Amazon will add more than 5 million Prime members this year, for a total of more than 181 million. That’s more than two-thirds of the U.S. population.”

For more expert opinions and the latest market news, click here to watch the full episode of Wealth!

This post was written by Nicholas Jacobino

Video Transcription

Well, today is Amazon Prime day and Prime members can count on discounts on millions of deals.

Amazon says customers saved more than $2.5 billion on transactions last year.

So what are the expectations this year in terms of more events?

We have Sky Knauss who is an e-marketer and lead analyst for retail and e-commerce?

It’s nice to have you here with us.

APPROX.

So first of all, what are the expectations for this year?

As you heard in our previous conversation, some retailers started promoting and trying to get ahead of Amazon.

Some of them are also trying to leverage the same type of SEO and online traffic that Amazon has brought in, as well as a lot of other retailers that have kind of added to our strategy themselves.

Well, this year when it comes to Prime Day, Amazon went with what has worked before and what continues to work.

And really, it’s all about offering great deals and benefits to Prime members to reinforce the value of Prime membership and get more people to sign up. It’s still working.

We forecast Amazon will add over 5 million Prime users this year, bringing the total to over 100 million and 81 million.

This represents more than two-thirds of the US population.

So the fact that membership continues to grow while remaining at the same level is truly impressive.

As for Prime Day, Amazon still dictates the schedule and takes the majority of the sales.

That’s why we, the consumers, are expected to spend almost $14 billion online over those two days, and almost 60% of that amount, or more than $8 billion, will be spent on Amazon.

And this 60% is significantly higher than Amazon’s average annual e-commerce turnover in the US, which is around 40%.

So which categories tend to outperform those that are likely to be the largest transactions or the categories that generate the most traffic?

This year we have seen a lot of interest in the essentials categories, especially recently, starting with last year’s Prime Day and this year’s spring sale.

Products such as food and beverage and health and personal care are very popular on Amazon, and in the beauty segment, Amazon has highlighted a number of new brands such as Clinique and Kel. In the beauty segment, online sales on Amazon continue to outpace overall e-commerce growth in the category.

It’s a very strong and resilient category where brands are eager to be on Amazon because a lot of consumers are looking for beauty products there. If beauty brands aren’t selling them, then third-party sellers will. We’ll also see some growth in small consumer electronics, things like headphones and accessories, chargers, and also school supplies.