Monday is the start of Amazon’s annual Prime Day sale, when subscribers to the company’s Prime service get major discounts
This year’s Prime sale stretches across two days, and Amazon is not the only company involved. A record 250 retailers are offering their own sales to compete with Prime Day.
As The New York Times reports, analysts are calling this confluence of summertime promotions “Black Friday in July.” In 2018, retailers in the U.S. recorded $447 billion in July sales, $4 billion more than their total that December.
But the emergence of a second major shopping season—four months before Thanksgiving—may come at a cost for the hundreds of retailers scrambling to keep up with Amazon, because customers may not return for the typical sales seasons.
John Nash, the chief marketing and strategy officer at RedPoint Global, a data management firm that works with retail companies says stores should focus on creating long-term relationships with customers, rather than chasing temporary sales spikes. Flash sales can condition customers to only shop when there is a sales event, instead of returning to a store regularly over time.
Another risk that retailers should consider as they plan mid-July sales is cannibalization, said Guy Yehiav, the chief executive of Profitect, an analytics provider for the retail industry. Shoppers who buy heavily discounted items in July may be less inclined to return to the same stores later in the summer, which costs both margins and foot traffic. Read the full story.