One day every July, Amazon buckles down and celebrates Prime Day. This year, the 36-hour sale (six hours longer than any year prior) features more than 1 million deals, and its global reach has been extended to four new countries. Now Prime members in Australia, Singapore, Netherlands and Luxembourg can join those in the U.S., UK, Spain, Mexico, Japan, India, Italy, Germany, France, China, Canada, Belgium and Austria in fetching deals on everything from apparel to electronics.
Introduced in 2015 to celebrate Amazon’s 20th anniversary, Prime Day is a way for the Seattle-based e-commerce platform to boost business during the slow summer months and potentially steal some of the steam away from the impending Black Friday in November. Most importantly, though, the annual shopping event “is an aggressive marketing tool for Amazon’s Prime subscription service,” writes Wired’s Katia Moskvitch. “There are now more than 100 million Prime members, [and] some 16 percent of them signed up for the sole purpose of getting access to Prime Day promotions.”
The shopping extravaganza is squarely within the bounds of a budding trend amongst brands and retailers that have added specialized “holidays” to the calendar to ensure that big retail sales are not limited only to major national holidays. Last year, J. Crew, which has been struggling for years to regain its footing in the crowded apparel market, announced that National Stripes Day will take place on March 31. A few days before – on March 26 – falls Nike’s Air Max Day. Lilly Pulitzer has since followed suit, making June 21 “National Wear Your Lilly Day.”
There is also the Nordstrom “Anniversary Sale,” the Bloomingdale’s “Friends & Family Sale,” and the various seasonal and semi-annual sales that occur throughout the year.
All of these days are small change, however, compared to Alibaba’s Singles Day. The Chinese holiday – which was co-opted by e-commerce giant Alibaba in 2009, as a means of boosting revenue in the traditionally quiet sales period before the Lunar New Year season – is now the world’s biggest shopping spree, with millions of shoppers eager to snap up cut-price deals. Last year, the 24-hour extravaganza resulted in a whopping $1.5 billion in sales within 3 minutes and $25 billion in total.
These annual shopping events are similarly part of a much larger trend in retail, the pervasive practice of discounting, which has not only affected brands’ prices and their bottom lines, but it has fundamentally impacted the consumer psyche. And it extends far beyond Amazon and Alibaba to even some of the buzziest brands being offered by fashion retailers, whether it be Vetements or Off-White. As Moskvitch says, “Combined with continuous discounting throughout the year, [these special events] mean customers have been trained not to pay full price.”
Last year, First Insight, a Pennsylvania-based retail business analytics firm, reported that retailers’ and brands’ practice of constant discounting has created a “sale fatigue” for consumers who rarely expect to pay full price for apparel and accessories anymore. In particular, the report, entitled, “Markdown Mania,” states that 45 percent of American women need to see a markdown of 41 percent or more to even enter a store.
In case that is not enough, the study revealed that instead of paying full price, consumers are generally willing to pay only 76 percent of the full price of womenswear products, noting that “consumers are not seeing enough value in products to pay full price.”
As long-time Forbes contributor Steve Olenski noted last year, the impact of constant discounting is so significant that “consumers have seemingly been forever changed in their mindset about needing to continue to see percentage reductions to merchandise. In fact, they may never want to pay full price again.”