The 36-hour retail whirlwind that was Amazon Prime Day has passed.
And while analysts’ estimates have the event pegged for big sales gains — and a total take of potentially $3.6 billion in sales — the fourth outing of the e-commerce giant’s summer holiday had a decidedly glitchy start. Shortly after the sale began Monday afternoon, consumers around the country were awash in Amazon’s dog-themed error pages as the e-commerce site buckled under the stampede of visits.
The company didn’t immediately respond to a WWD request regarding the scope of the outages or the number of users affected. But the stakes are high, even if the doggie error pages gave the computing shortfall something of a breezy feel.
“While Amazon has done well to cultivate strong brand loyalty through its seamless shopping experience and conveniences like free shipping, this Prime Day ‘black eye’ will no doubt resonate with customers,” said Jeff Cheal, director of product strategy, personalization, campaign and analytics at digital experience firm Episerver. “Our experience and research show that customers are quick to jump ship if an online shopping experience doesn’t live up to these new standards, even with sites they’re familiar with. We’ve found that over half of consumers have abandoned a purchase because they can’t find what they’re looking for quickly enough.”
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Anything that gives shoppers pause about the increasingly dominant Amazon, no matter how slight, opens up opportunities for others, including Walmart Inc., which is in the midst of a big push to remake its digital business and reach shoppers in new ways.
But despite the glitchy start, Prime Day seemed to catch its stride.
Leading into the event, brands like Calvin Klein — which jumped onto the e-tailer’s best-selling lists for apparel — were poised to skyrocket on the platform. “Based on our checks, CK jumped on Amazon’s bestseller list for men’s clothing this week, to the highest level since we’ve been tracking,” said Instinet analyst Simeon Siegel. “CK also returned to women’s bestsellers, also a new high since we’ve been tracking, and after several months of not showing up at all.”
Ahead of Monday, the sales predictions painted a multibillion-dollar picture. Last year, a shorter Prime Day raked in $2.4 billion. This year, Coresight Research projected that sales during the 36-hour period, which also offered more categories, would grow at least 40 percent to $3.4 billion. GBH Insights analyst Daniel Ives said it could go even higher, to $3.6 billion. Amazon was not specific, but did say late Tuesday that small- and medium-sized businesses had scored sales of more than $1 billion since the day before.
Prime Day is big, but not the biggest. By way of comparison, Alibaba’s Singles’ Day raked in $8.59 billion in sales in just one hour last year, pulling in more than $25 billion for the whole sale — which, notably, stayed within a 24-hour time frame.
Amazon’s annual sale has created a sprawling shopping eco-system with retailers of all stripes jumping in and becoming more aggressive. Katie Smith, retail analysis and insights director at big-data fashion firm Edited, noted that other retailers over the past week have shown a 114 percent increase in use of the word “prime” on their web sites and in newsletters, compared with a year ago.
“Retailers bump up the use of terms like ‘prime sale’ so that their newsletters or sites come up when searched in in-boxes or search engines,” Smith said.
While many see the event as largely an opportunity for Amazon to add more members to its 100 million-strong Prime membership program, it does make for a sales day to rival Black Friday and Cyber Monday.
Amazon reported that by 1 a.m. Eastern time, sales for Prime Day-featured goods had outpaced last year’s take.
Information from Feedvisor, a data-driven analytics firm that works with merchants selling on Amazon, showed that sales for the first 12 hours of Prime Day showed an 89 percent increase from the event last year. However, that compares to a period that started at 3 p.m. Eastern time this year, when office workers are often still parked at a computer, with one that started at 9 p.m. last year.
Prime Day has certainly made its mark, but Amazon’s technical fumble could have ripple effects beyond e-commerce sales.
The web site hiccups appeared to stem from Amazon Web Services, a major cloud provider that powers much of the web. An AWS outage earlier this year caused service disruptions across numerous sites, including retail, streaming and others. According to Synergy Research, Amazon’s business accounted for roughly 40 percent of the massive cloud-server market in mid-2017.
Since its launch in 2006, AWS has become something of a cash cow for Amazon. The company’s cloud revenue leapt 43 percent last year to $17.46 billion.
The operation now helps power an increasing load of partner companies’ artificial intelligence and machine-learning initiatives.
It’s hard to imagine a more public stumble than Monday’s glitch, a meltdown likely caused by an overtaxed system hammered by enterprise load and millions of Prime Day shoppers converging at once. The timing couldn’t be worse — for multiple reasons: The glitch came just after Goldman Sachs pointed out that Microsoft’s Azure was closing its gap with AWS.
As for just how far the ripples extend beyond Prime Day, it will be up to shoppers to determine. Sales numbers are one thing; consumer sentiment is another.
“If site performance stands in the way of a consumer’s shopping experience, especially during a banner sales event, users won’t quickly forget this,” said Cheal of Episerver. “If Prime members can’t shop for the deals they were promised on Prime Day — Amazon’s highly publicized bell-ringing event — it means Amazon has fumbled in delivering on the very premise that has made it into the retail juggernaut it is today.”
For their own part, investors shrugged off any worries about the glitch and shares of Amazon rose 1.2 percent to $1,843.93 on a generally positive day for retail stocks. Among the strongest retail and fashion gainers were Guess Inc., up 4.7 percent to $23.18; Stitch Fix Inc., 4.2 percent to $34.43; Canada Goose Holdings Inc., 4.1 percent to $63.60, and Urban Outfitters Inc., 3.2 percent to $45.92.