After the Big Prime Day clothing discounts, what does the holiday have in store for us? – Supply Log

0

With Prime Day in the rearview mirror, trends emerging from the two-day trading event could influence the second half. Beyond apparel discount data, Amazon’s annual shopping explosion also got a boost on TikTok, where tens of millions of users got inspired on what to buy before. the expiry of the deadline.

While total spending during Prime Day generated $11.9 billion on 8.5% year-over-year growth, revenue was far beyond the shopping extravaganza of the 11 to July 12.

Including sales for the full week, Prime Day generated $22.4 billion in online e-commerce spending, an annual growth of 6.1%, according to data from the Adobe Digital Economy Index.

During Prime Day, the average increase in online revenue in the United States increased by 141% compared to an average day in June (the month Prime Day took place in 2021). Online spending for July rose month over month, reaching $44 billion in total and counting as of Tuesday.

As inflation affects consumers’ discretionary budgets and more retailers try to offload more merchandise, discounts have boosted sales. It’s an indicator that markdowns are being reinstated as the norm after a 2021 that saw an increase in full-price sales.

During the week of Prime Day, toys saw the steepest discounts at retailers at 15.4%, with apparel also seeing deep discounts at 12%, Adobe said. Recent research from Impact Analytics backs up the deep discounts on apparel, noting that the category alongside home improvement accounts for the biggest discounts on Prime Day 2022.

The Impact Analytics report indicated that on a three-year basis, when normalizing to pre-Covid levels, discounts on Amazon Prime Day are twice as high on average across all categories.

Look to the largest retailer in the United States to see the retail mindset with price reductions and tactics to boost sales. Walmart CEO Doug McMillon said the company made good progress in removing hardline categories in the second quarter, but noted that apparel sold in the U.S. “needs more markdowns” due to rising levels of inflation of food and fuel.

The company said it was cutting apparel and general merchandise to quickly run through inventory.

According to data from Adobe, which covers more than 1 trillion visits to US retail sites and more than 100 million SKUs across 18 product categories, electronics has seen its discount levels fluctuate. around 6%. In the electronics category, prices for computers fell 8%, while those for televisions fell 3%.

For example, popular product categories that saw a slight increase in discounts included boys’ and girls’ clothing, audio equipment, and home appliances.

Research from Impact Analytics indicated that these deep discounts suggest that average Prime Day order value actually increased 16% to 17% from last year, while gross merchandise value jumped between 8 % and 9%.

Looking at Prime Day data, there may be clues to potential discount strategies being rolled out during the holiday season, particularly Black Friday, according to Impact Analytics research.

In one highlighted case, deals in the small appliance segment during Prime Day 2019 were 7% to 10% lower than the historical average, while they were 5% to 10% higher in 2020. A similar trend has followed in Black Friday sales for each year, with offers 5-7% lower in 2019 and 5-7% higher in 2020 than the historical average.

“After nearly two years of dealing with supply chain issues, watching inventory levels melt away, warehouses are overflowing this year,” the report said. “A classic bullwhip has led to a general oversupply of inventory at most major retailers in the United States. That means the holiday season will likely be milder this year, and possibly sooner too. Due to inaccurate assortment decisions and faulty demand forecasts, retailers will have to resort to heavy markdowns this holiday season.

BNPL and TikTok play a bigger role in Prime Day

Of note in Adobe’s analysis is the increased use of buy now, pay later (BNPL) platforms throughout Prime Day. During the two-day event, usage of BNPL platforms increased 13% from Prime Day 2022 compared to Prime Day 2021, while average order values ​​(AOVs) while using platforms grew 12% year over year.

The adoption of BNPL comes as more people use Klarna, Afterpay, Affirm and other platforms in the space. Amazon, which tied up with Affirm last August, went on a frenzy this year by allowing Prime members to choose from three BNPL bundles for Prime Day purchases of $50 or more. Buyers could choose to finance their purchases over three, six, or 12 monthly installments equal to zero percent interest, a departure from traditional Affirm plans that often carry an APR between 10 and 30 percent.

Prime Day caused a stir on social media in 2022 thanks to the hype it generated on TikTok. According to data from e-commerce intelligence firm Marketplace Pulse, videos tagged with #primeday2022 have been viewed 52 million times on TikTok, a massive jump from the 30 million views of the 2021 version of the hashtag. In 2020, these videos only got 6 million views.

In a blog post, Marketplace Pulse founder Juozas Kaziukenas said shoppers are turning to TikTok because Amazon has focused too much on promoting offers, instead of personalizing them for individual shoppers. It apparently opened the door for TikTok, he said.

“‘I didn’t know what to buy on Prime Day, so I went to TikTok,’ was a sentiment shared by many shoppers at the event. ‘True Story: When I wanted to check out all the best Prime Day deals , the first place I looked? TikTok,” others shared. Most of Prime Day was on TikTok rather than Facebook, Instagram, or Twitter; its content model works best for that,” said Kaziukenas.

Prime Day was also a boon for brick-and-mortar retailers that offered buy-on-line, pick-up-in-store (BOPIS) options, according to Adobe data. For retailers carrying BOPIS, the conversion rate increased by 20% compared to an average June day.


Source link

Share.

Comments are closed.