Amazon’s massive Prime Day sale is almost here. The event will be on July 12 and July 13 this year. No one should underestimate how important Prime Day is for the country’s largest e-commerce company. Traffic to Amazon.com and total revenue are said to be larger on Prime Day than any other day of the year, which includes the holiday season.
Prime Day is particularly key to Amazon’s fortunes in 2022. Disappointing earnings numbers from its most recently reported quarter have pushed its shares down by 35% in 2022. Up until this year, Amazon was one of the best performing U.S. stocks for a decade.
Amazon’s primary challenge for the balance of the year is the headwinds of a forming recession. People will shop less and spend less on discretionary items. Amazon is not immune from a wave of economic trouble that will wash over almost the entire economy.
A study done recently shows how critical Prime is to Amazon’s top line. An average Prime member spends $1,400 a year with Amazon. Other customers spend an average of $600. Amazon also earns a large amount of money from subscription fees. These rose to $139 per year in February.
Amazon Prime has a long list of benefits. The best known of these is probably Prime Video. It has tens of thousands of TV shows and movies, most of which are free with a Prime membership. The service competes with Netflix, Disney+ and over a dozen smaller streaming services, most of which are owned by large media companies.
The other well-known feature of Amazon Prime is free two-day shipping for most items Amazon shoppers buy. In some parts of the country, this extends to free same-day delivery.
Amazon Prime also has features for gaming, music, food shopping through Whole Foods, and discounts on thousands of items across dozens of categories. Another major feature is free photo storage.
The best feature of Prime is among its oldest. Free two-day shipping can save Prime members hundreds of dollars a year. Some retailers offer free shipping, but the time from order to delivery can be as many as five days. For heavy Amazon shoppers, even Prime Video is not as valuable.
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