Instant Pots and Roombas are usually popular items during Amazon’s Prime Day event. But this year, consumers were more interested in dishwasher capsules, diapers and snacks.
Looking at some of the most popular items during Amazon’s two-day discount event, which ended late on Wednesday, provides a window into how record-high inflation is changing spending habits.
The consumer price index, a broad measure of prices of goods and services, rose 9.1% in June, a peak of 41 years. In the midst of rising prices, consumers have tightened their pockets, cutting back on discretionary spending.
Analysts had warned that inflation could dampen consumers̵[ads1]7; willingness to pay for a new TV or Echo smart speaker during Prime Day.
JP Morgan wrote in a note to customers on Monday that they estimate “slower growth in incremental Prime Day revenues given the challenging macro backdrop.” Analysts at the firm estimate a total Prime Day revenue of $ 5.6 billion, up just 5% from the previous year, compared to 50% year-over-year growth in 2020 and 9% year-over-year growth in 2021 .
So far, the Prime Day results have been better than feared. The company said on Thursday that it sold 300 million items during Prime Day, up from 250 million the year before, making it the “largest ever” in Amazon’s history.
Total online retail sales in the United States during Amazon’s Prime Day event exceeded $ 11.9 billion. This is 8.5% higher than total e-commerce transactions generated during last year’s event, according to data from Adobe Analytics. Other retailers such as Best Buy and Target tried to take advantage of the Prime Day frenzy by launching their own competing events.
Although inflation did not appear to hurt sales, it may have affected which products consumers bought. Shoppers chose consumer goods over indulgences, and searched for household products such as Amazon Basic’s garbage bags and Cascade dishwasher capsules, said Melissa Burdick, president of Pacvue, which helps companies advertise on Amazon and other e-commerce platforms.
“Sales are still very strong, but the shift mix in category is related to inflation, especially around food,” said Burdick. “If they could have figured out how to give away gas, it would be the best Prime Day ever.”
Rising prices in the grocery store are still a major concern for many people across the country. About 90% of Americans are concerned about food prices, according to a recent Harris survey in collaboration with Alpha Foods.
Frito-Lay snack packs were among the bestsellers during Prime Day, according to Numerator, which tracked Prime Day consumption. But Prime Day customers did not just stick to the most important thing. Amazon-branded devices continued to top the list of popular items during the event, the counter found. Amazon tends to give big discounts on its Echo smart speakers and Fire TV sticks on Prime Day.
Consumers also rejected large ticket items for smaller purchases. About 58% of Prime Day items were sold for under $ 20, while only 5% sold for over $ 100, according to the counter. About 34% of buyers surveyed said they waited for Prime Day to buy something at a discounted price, and 28% passed on a good deal because they did not see it as a necessity, Teller found.
Prime Day and the other discount events that ran alongside it serve as a good “litmus test” for consumer confidence amid fears of a looming recession, said Daniel Newman, chief analyst at Futurum Research.
“It sounds to me like most people still feel that their balance at home is good, that they are still willing to go out on a whim and buy something on a day like Prime Day,” Newman said.
Many consumers probably reasoned that it made more sense to buy “15 packs of Kind Bars and three new Echos” when offered at a discount, instead of waiting, he added.
“Should I spend $ 300 today, or spend $ 500 tomorrow?” in Newman. “I think a lot of people rationalize that way. If we’re going to buy this over the next few months anyway, I might as well do it now.”
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