🌀 Inside Amazon Prime Day's 10Y Growth 💸

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Last week, Channelx analyzed Amazon Prime Day's massive growth over the past 10 years to understand sales drivers and current trends. Channelx has pulled together impressive data to understand better what used to drive the sales and what happens now.

📅 Prime Day History

• Prime Day started on July 15, 2015, to celebrate Amazon’s 20th birthday.
  In 2015, 34.4M items were sold on Prime Day.

• By 2024, sales are expected to exceed 400M items, especially after India’s Prime Day.

• India’s Prime Day will further increase this year’s numbers.

🌍 Global Expansion

• Prime Day expanded from 9 countries in 2015 to 24 countries in 2024.

• In 2023, 25 countries participated, but China is no longer part of Prime Day.

• Sales periods extended from 24 hours in 2015 to 48 hours in 2024.
  Despite dilution in 2018, growth has accelerated again.

• Initially, sales growth was driven by coverage and duration, each at a 20% CAGR (2015-2019).

• Currently, item sales intensity drives growth but at a slower rate.

• Average sales per second per country dropped to 45 in 2018 but have since increased.

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Martin Heubel from Consulterce recently joined forces with Stratably to better understand what keeps Amazon suppliers up at night. Below selection of insights but feel free to check full report

📉 Sales Models and Strategies

49% of Amazon 1P vendors now use a hybrid sales model.
56% of vendors stick to an exclusive model with Amazon.
25% of vendors also sell through their own 3P Seller Central account.
11% use authorized resellers, and 8% use both resellers and 3P accounts.

📈 Amazon's Growth Channel

58% of brands see Amazon as a growing sales channel.
25% report Amazon's growth in line with the category average.
35% see Amazon growing faster than average.
17% note Amazon's growth as much faster than the category average.

💰 Profit Margins on Amazon

56% of vendors say Amazon's margins are equal to or better than other retailers.
23% report slightly lower margins on Amazon.
14% state their profitability is significantly lower with Amazon.

🔧 Priorities for Margin Management

58% of vendors plan to delist unprofitable products to boost profitability.
56% aim to focus marketing on high-margin items.
34% are developing channel-optimized SIOC/FFP packaging.
33% intend to raise cost prices with Amazon.

Earnest Analytics has recently analyzed credit card data to understand the impact of TikTok Shop's 'Deals for You Days' on US ecommerce.

📊 TikTok Shop Gains Market Share

• TikTok Shop's market share in Chinese ecommerce sales in the US hit 37% for the week ending July 11, 2024, up from 0% a year ago.

• The event coincides with other major sales like Walmart Deals, Target’s Circle Week, and Amazon Prime Day.

• TikTok Shop hosted brands like Benefit Cosmetics and COOLA, and creators such as simplymandys, Stormi Steele, and Tati Westbrook showcased their favorite products.

🛍️ Increased Customer Spend

• Starting July 9, brands like L’Oréal Paris, Maybelline New York, and Too Faced offered deals on TikTok Shop.

• Average customer spend hit a historic $52, despite a dip since March.

• TikTok Shop customers typically spend 70% of what Temu and Shein customers do, often making impulse purchases.

• 'Deals for You Days' does not have a set end date, extending the opportunity for increased sales.

▶🇺🇸 Amazon Prime Day 2024 sales hit $14.2B record, a record-breaking 11% increase from last year's $12.7B. Day one sales reached $7.2B, while day two hit $7B. Shopping on phones surged by 18%, making up nearly half of the purchases.

▶🇺🇸 Amazon minimum office hours to curb 'coffee badging'. Amazon is now enforcing a rule requiring employees to stay in the office for at least 2-6 hours per visit. This move is to stop employees from briefly showing up just to meet the attendance requirement. Many employees are frustrated and finding ways around it.

▶🇺🇸 Amazon’s Prime Day causes environmental harm. Despite efforts to reduce plastic and emissions, experts highlight the negative environmental impact. From plastic waste to carbon emissions, the damage is significant.

▶🇳🇱 Bol.com Adds New Ad Space, Updates Review Policy. Bol.com introduces Sponsored Products, better partner tools, and a review policy change. The updates include enhanced ad placement, new platform features for sellers, and compliance with the Digital Services Act. All sellers will access these changes by the end of August.

▶🇺🇸 eBay’s $59M settlement over counterfeit diet pills. In Feb 2023, an eBay buyer tested positive for meth after taking counterfeit diet pills. eBay settled for $59M with the DOJ for making pill presses accessible to criminals. The FBI and manufacturers confirm widespread issues with fake diet pills on eBay.

▶🇺🇸 eBay offers up to $1M for seller growth. eBay and Liberis launch a new product, Business Cash Advance, offering up to $1M in working capital to U.S. sellers. Applications are 100% online, and funds are available in 24 hours, with flexible payments and transparent reporting.

▶🇺🇸 TikTok's age loophole lets teens access adult shop. Teens are accessing TikTok Shop, meant for adults only, due to a loophole where teens lie about their age and later set up Family Pairing with their parents. Despite parental controls, these teens can still see and buy adult products.

▶🇧🇷 AliExpress starts fee for purchases under $50. Starting July 27, AliExpress will charge fees on orders under $50 due to new Brazilian tax rules. From August 1, all shipments to Brazil must comply with the new import tax rates, impacting the cost of purchases significantly.

▶🇨🇭 Frasers Group eyes Yoox Net-a-Porter takeover. Frasers Group, advised by Goldman Sachs, is eyeing Yoox Net-a-Porter from Richemont. Richemont seeks to sell after a failed deal with Farfetch. Frasers has been actively acquiring luxury rivals, including Matches Fashion and Coggles, indicating a strategy to dominate the market.

▶🇪🇸 Mango plans 500 new stores by 2026. Mango, celebrating its 40th anniversary, will open 500 new stores by 2026 in markets like the U.S., Spain, and India. Mango Home will launch standalone stores. The board expands to nine members, and CEO Toni Ruiz becomes a shareholder.

▶🇺🇸 Depop removes selling fees in the US. Depop removes its 10% selling fee for US sellers, starting today. Instead, buyers will pay a marketplace fee. This follows a similar change in the UK. The move aims to empower sellers and enhance the buying experience, contributing to the circular fashion system.

▶🇪🇺 Douglas Group raises forecast to 8.5%. European beauty giant Douglas Group raises its sales growth forecast to 8.5% after strong Q3 results, with CEO Sander van der Laan citing significant progress and increased profitability.

▶🇫🇷 EssilorLuxottica buys Supreme for $1.5B. EssilorLuxottica buys Supreme for $1.5B, less than its worth. Meta may acquire 5% stake for $5B. Both companies already collaborate on smart glasses.

▶🇨🇳 Shein Now Selling Xiaomi Phones at High Prices. Shein, known for its clothing, now sells Xiaomi smartphones. Prices range from $392 for a Redmi Note 12S to $1,232 for a Xiaomi 14 5G, which are higher than other stores. Consumers are advised to shop elsewhere for better deals.

▶🇺🇸 Whole Foods Partners with Too Good To Go to sell surplus food. The app, with 100M users, helps cut food waste and offers discounts. The program, now at 450 Whole Foods stores, saves millions of meals. Whole Foods aims to cut waste by 50% by 2030.

▶🇩🇪 Wolt opens new virtual supermarket in Hamburg, offering over 5,000 products. Orders can be delivered within 35 minutes. Local products from Luciella's Ice Cream and North Coast Coffee Roasters are included at launch.

▶🇩🇪 Aldi's Pickup Service Revolutionizes Shopping. Aldi Süd has launched pickup stations for their delivery service, starting July 15. This allows customers to schedule pickups at their convenience. Initially, the service is available in select cities, with a minimum purchase of 20 EUR until July 24, after which it will be 50 EUR.

▶🇺🇸 Walgreens launches new health food line. Walgreens introduced Nice! For You, a new health-focused line with over 150 items free from artificial ingredients. This move aims to boost sales as private label products gain popularity. Tracey Brown highlights their commitment to high-quality, affordable products.

▶🇵🇱 Kaufland enters Polish market to challenge Allegro. Kaufland's new online marketplace will start in Poland on August 7, 2024. It will offer millions of products in over 6,400 categories, featuring both small and large sellers. The marketplace aims to compete with Allegro and Amazon.

▶🇺🇸 Instacart partners with Northwell Health. Instacart Health teams up with Northwell Health to launch a program enhancing food access for expectant mothers in New York's underserved communities. This initiative is part of a broader effort to address health disparities.

▶🇺🇸 Walmart partners in-store with Mr. Gatti's Pizza. Mr. Gatti’s Pizza is partnering with Walmart to open 92 units inside Walmart stores in Texas, Louisiana, Oklahoma, and Kentucky. The first 12 units will open in Q4 2024. This partnership nearly doubles Mr. Gatti's footprint to 230 units.

▶🇮🇳 Zomato and Swiggy raise platform fees 20%. Zomato and Swiggy have raised their platform fees by 20%, from ₹5 to ₹6, starting July 14. This fee hike applies to Delhi and Bengaluru, with plans to expand to other cities. The increase will help the companies generate an extra ₹1.25-1.5 crore daily.

▶🇺🇸 Etsy strengthens commitment to creativity. Etsy's CEO announces new Creativity Standards, emphasizing seller involvement. The platform introduces new item details, highlights creative processes, and launches a new marketing campaign. Key events include Etsy Up and Etsy Design Awards.

▶🇺🇸 Indiegogo launches IndieShop with 40+ products. Indiegogo launched IndieShop, an ecommerce platform with over 40 crowdfunded products. A partnership is planned to bring successful projects to physical stores. Indiegogo also offers new services, including customer insights and pay-over-time for backers, with reduced fees until the end of 2024.

▶🇰🇷 TikTok sees K-culture spend doubling to $143B. Global spending on Korean cultural products is expected to nearly double to $143B by 2030, driven by TikTok's influence. Currently valued at $76B, Hallyu's growth is fueled by viral K-content across platforms, especially in the U.S. and Southeast Asia.

▶🇺🇸 Wayfair announces four-day summer sale event. Wayfair is hosting a four-day Black Friday in July sale from July 26-29 with discounts up to 80%. The sale will be online, in the app, and in stores, featuring flash deals and doorbusters for back-to-school and home items.

▶🇺🇸 IKEA U.S. launches Spanish e-commerce platform. IKEA U.S. introduces a Spanish language e-commerce platform, providing support and accessibility for Spanish-speaking customers.

▶🇮🇳 Bigbasket launches BB Matrix to boost e-commerce. Bigbasket, owned by Tata, launches BB Matrix, a SaaS platform to help mid-to-large companies in various industries modernize supply chains. They plan to target automotive and electronics manufacturing, aiming for both Indian and global markets.

▶🇫🇷 Leroy Merlin’s marketplace hits $278K milestone. France-based Leroy Merlin’s online marketplace reached profitability in January 2024, just three years after its launch. With over 500 third-party sellers, the marketplace offers millions of additional products, driving significant growth in sales and customer engagement.

▶🇺🇸 Flip Acquires Curated, Expands Social Commerce Reach. Flip acquired Curated for $330M in stock, aiming to enhance social commerce in the U.S. Flip has 5M users and features 5K brands. Curated specializes in high-investment purchases with expert advice. Flip focuses on authentic, user-driven reviews.

▶🇵🇱 Synerise gets $8.5M boost from VTEX. Synerise, an AI-driven Behavioral CRM, received $8.5M from VTEX and business angels in a Series B+ round. This funding will help Synerise expand into new markets and strengthen its AI leadership. The company is now valued at $120M.

▶🇩🇪 Grover secures €50M for rental commerce growth from Cool Japan Fund. This capital will help Grover, a leader in rental commerce, to promote a circular economy and expand its global reach.

▶🇺🇸 Fanatics launches new collectibles marketplace. Fanatics launches Fanatics Collect to replace PWCC. The new marketplace offers trading cards and memorabilia through fixed-price listings and auctions. CEO Nick Bell emphasizes quick, easy, and fun transactions for collectors.

That’s all. See you next week in the 🌀Maze!

Your guide through the maze

Artur Stańczuk Chief Strategy Officer at Packhelp, the leading European packaging marketplace. Previously worked ~8 yrs at Bain & Co. In the past, Digital Transformation Director at the leading Polish convenience chain Żabka and Entrepreneur that co-launched 3 startups