Amazon.com Inc.’s fall sale for Prime subscribers kicked off Tuesday, with the e-commerce giant looking to get a jump on what’s expected to be a humdrum holiday shopping season.
US online sales in November and December will rise 4.8% to $222 billion, according to Adobe Inc., beating last year’s 3.5% growth, but well below the pre-pandemic level of 13% reached in 2019.
Consumers are grappling with stubbornly persistent inflation even as their debt obligations balloon and savings shrink. The resumption of student loan payments, which were suspended during the pandemic, also are expected to weigh on spending.
Penny-pinching will be the prevailing theme during Amazon’s two-day sale, said Adobe analyst Vivek Pandya. He predicts intense comparison shopping as other retailers, including Walmart Inc., seek to draft off the event. The competition, along with unsold inventory, will necessitate deep discounts, Pandya said.
“When you have more retailers coming in [and] people are comparing prices across multiple options, it puts shoppers in the driver’s seat to try to manage costs in this inflationary environment,” he said.
Adobe also predicts that buy-now-pay-later services will hit a record this holiday as increasingly cash-strapped US shoppers struggle with higher prices and rising borrowing costs.
Amazon launched its Prime Day summer sale in 2015 to attract new subscribers, who pay $139 a year for shipping discounts, video streaming and other benefits. The event helps Amazon lock in shoppers before the holidays and deepen its relationship with existing customers by offering them exclusive deals on Amazon gadgets and other products.
The Seattle-based company added a second event last year, called Prime Early Access Sale, that saw shoppers largely shun pricey products and load up on discounted pantry items instead. This year’s fall sale has been renamed Prime Big Deal Days.
During the two-day period, total US online sales will reach $8.1 billion, up 6.1% from a year earlier, according to Adobe.
Consumers seem prepared to start their holiday spending early as long as they deem the discounts sufficiently compelling. Some 64% of shoppers said they’d begin shopping in October this year, up from 53% a year ago, according to a survey conducted by RetailMeNot, which monitors online deals.
About 58% of those surveyed said they’ll shop Amazon’s Big Deal Days and planned to spend $154, which is about $100 less than what those surveyed planned to spend during the Prime Day sale in July.
“People are definitely out there looking,” RetailMeNot editor Kristin McGrath said. “How well these sales do, and how much people actually buy, remains to be determined.”
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