Amazon Prime Day breaks record; sales grew by more than 60 percent
- Prime Day sales this year surpassed Amazon's Black Friday and Cyber Monday, the e-commerce giant says.
- It says sales grew by more than 60 percent from 2016.
- A "record number" of Prime members shopped across 13 countries, Amazon says; The most popular purchase was the Echo Dot.
Amazon's third annual Prime Day ended with a bang.
Amazon said Wednesday that the sales event was its "biggest day ever," with sales this year surpassing its 2016 Black Friday and Cyber Monday results.
Prime Day sales grew by more than 60 percent from the same 30-hour window in 2016, with a "record number" of Prime members shopping across 13 countries, Amazon said. It added that "tens of millions of Prime members" rang up purchases during the event, up more than 50 percent from last year's shorter Prime Day.
One factor that could have skewed this year's results was that last year's Prime Day was for 24 rather than 30 hours, and it involved fewer countries.
Amazon didn't immediately comment on the impact of the longer shopping period on the results.
Last year, Prime Day also was Amazon's biggest sales day ever at the time, setting the bar high this go-round. In 2016, Prime Day sales rose more than 60 percent from the prior year, and in the U.S. orders were up more than 50 percent, Amazon said.
But this year's performance shows the self-created shopping holiday continues to have room to grow, which is notable given that July tends to be sluggish time for retailers.
"I kind of think for retailing [this] is hilarious and scary, both," retail consultant Jan Kniffen of J. Rogers Kniffen told CNBC's "Worldwide Exchange" on Wednesday morning. "Nobody does any business in July. ... Amazon intends to take over the world, and they're doing a pretty darn good job of it."
Once again, Amazon used Prime Day as a way to drive both sign-ups for its annual Prime memberships and to promote its products.
It appears to have succeeded on both fronts.
Amazon said more new members joined Prime on July 11 than on any single day in the company's history. To take advantage of the discounts, shoppers had to be Amazon Prime members, which costs $99 a year, or $10.99 a month, and includes perks like free, two-day shipping and access to Prime Video and Prime Music.
"As more new members joined Prime yesterday than on any single day in Amazon history, the ability of Prime to build aggressively upon its base ... demonstrates that Amazon is succeeding in its strategy to build an ecosystem that is undeniably attractive to all customers," Matt Sargent, senior vice president of Magid's retail division, told CNBC on Wednesday.
Gaining new Prime members is a key part of Amazon's strategy, as those customers tend to be more loyal than other shoppers. The average Prime member spends $1,300 on the online shopping platform annually, compared with $700 for non-Prime members, according to data from Statista.
If this growth trajectory continues, Amazon Prime should be used in more than 50 percent of all U.S. households before the year is over, much thanks to the latest Prime Day subscription boost, Cowen & Co. analyst John Blackledge wrote in a note to clients. As Prime Day 2017 "etches itself in the record books," new Prime member growth is "arguably [the] biggest positive," of the event this year, he added.
Amazon said its Prime members' most popular purchase this year was the Echo Dot, the company's more affordable — and smaller — version of its Echo personal home assistant. On Prime Day, the Dot's price dropped by $15, bringing it to $34.99.
Amazon's stock jumped $11 higher at one point Wednesday following the highly anticipated Prime Day announcement, breaking the $1,000 mark once again.
Amazon said Prime Day this year was the biggest sales event ever for Amazon-branded devices in the U.S. and around the world, with the event bringing in record sales for the Echo, Fire tablets and the Kindle.
Excluding Amazon's own devices, a top-selling item in the U.S. was an Instant Pot pressure cooker; in the U.K., shoppers were seen picking up more Sony Playstation 4s; in Japan, Amazon sold a lot of its Happy Belly bottled water; and in Germany and Austria, the Soda Stream was popular.
Worldwide, more than 3.5 million toys were purchased on Prime Day.
Members found deals on Prime Day organized by more than 20 of the most-shopped-for themes — from pet lovers to gardeners. The most popular themes on Prime Day were home chefs, techies and for the home, the company said.
"To those customers who tried Prime for the first time and our long time members, thank you for a great Prime Day," Greg Greeley, the Amazon Prime division's vice president, said in a statement.
"Our teams around the world will keep working to add more and more to your membership, so Prime continues to make your life better every day. We are already looking forward to our Prime Day celebration next year."
The first Prime Day was held on July 15, 2015, as a way to mark the company's 20th anniversary, and it proved to be such a success in boosting sales and bringing in new Prime members that the company did it all again on July 12, 2016.
This year, Amazon declared July 11 to be Prime Day, but the savings kicked off even earlier for Prime members and were extended to last for 30 hours, up from the typical 24. Amazon.com was offering new deals as often as every five minutes, the company said, reaching 13 countries and making the day more of a global phenomenon.
"Never is there a better day to illustrate just how far ahead Amazon is compared to other retailers," Radial's Stefan Weitz, the commerce technology firm's senior vice president of technology, told CNBC. "This is highlighting a massive differentiation between Amazon and everyone else."
Amazon's pricing pressure and customer experience pressure were king to other retailers on Prime Day, Weitz said. He added that seven major brands represented by Radial, which are sold on Amazon.com, saw "significant sales" as a result of the 30-hour shopping surge.
Some of the best Prime Day discounts across the board included those on Amazon's own electronic devices, such as the Echo and the Kindle. There were also significant discounts on some of Amazon's private-label grocery and apparel products.
With an Amazon-Whole Foods deal in the works, more online shoppers were seen browsing Amazon.com for supermarket staples and everyday essentials, which notably haven't been best-sellers for the internet giant in past Prime Days.
"It's no secret that some of Prime Day's best deals have been on Amazon products — Audible, Kindle or even Prime memberships," Maya Mikhailov, co-founder of GPShopper, told CNBC.
Yet considering how this year Amazon was using Prime Day to introduce customers to the company's newest grocery offerings, and with tens of millions of Prime members, traditional grocery retailers should be "very worried," Mikhailov said.
Early signs hinted that Amazon's annual shopping event would grow in 2017. In a nationwide survey of 1,200 U.S. consumers by Market Track, 58 percent said they would shop Prime Day deals, up from the 34 percent who said they would participate last year.
"Aside from a minor glitch in the first hour, Amazon had very fast load times despite the heavy traffic of Prime Day," said Mehdi Daoudi, CEO of Catchpoint, a digital experience intelligence company. "This is especially notable because their sites were heavy with many product images, and still they loaded faster than the competition."
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