Amazon (NASDAQ:AMZN) has announced that it will be holding its second annual Prime Day on July 12 this year. The annual Black Friday-like sales event features hundreds of thousands of special discount offers exclusively for Amazon Prime members. Prime Day is Amazon’s biggest sales day of the year.
Amazon’s first Prime Day impressed many and set multiple records for the company. Last year’s Prime Day brought in an additional $400 million in revenue with 34 million items ordered, setting a new record. This year’s event is predicted to be bigger in terms of revenue, based on increased awareness, more compelling deals, and higher in-stock levels.
Last year’s Prime Day brought in hundreds of thousands of new Prime members worldwide. In order to take advantage of the Prime Day offers, you must be a Prime member. Prime, the $99-a-year shopping club, is arguably the most important factor in Amazon’s retail dominance. The Netflix-like Prime Instant Video service is included as part of the annual fee. Prime members can also access to Kindle e-books and Amazon’s music-streaming service.
Prime members tend to spend more than non-Prime members. According to Consumer Intelligence Research Partners, Prime members spend $1,100 on Amazon each year on average, nearly double the amount spent by those who aren’t Prime members. The firm estimates there were 54 million Prime members in the U.S. at the end of 2015.
Amazon’s e-commerce diversification into nearly every imaginable product and service has also helped the company thrive in the competitive retail landscape. A lot of the Prime Day offers will include Amazon’s own hardware devices, like the Kindle and Fire TV. Prime Day is attractive to many third party sellers, as last year’s event was the biggest sales day ever for these vendors. Amazon is interested in attracting as many third party sellers as possible because they drive more customers and sales to its site.
Amazon’s stock hit a new all-time high on Thursday. The company has gained nearly 10 percent this year, despite worries about a slowing global economy. JPMorgan remains bullish on Amazon’s stock in the second half of fiscal 2016.