Amazon extends Prime Day discounts to 4 days as retailers weigh tariff-related price increases

Boston Globe

12 hours ago

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Amazon executives declined to comment on the potential impact of tariffs on Prime Day deals. The event is taking place two and a half months after an online news report sparked speculation that Amazon planned to display added tariff costs next to product prices on its website.
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White House Press Secretary Karoline Leavitt denounced the purported change as a 'hostile and political act' before Amazon clarified the idea had been floated for its low-cost Haul storefront but never approved.
Amazon's past success with using Prime Day to drive sales and attract new members spurred other major retail chains to schedule competing sales in July. Best Buy, Target and Walmart are repeating the practice this year.
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Like Amazon, Walmart is adding two more days to its promotional period, which starts Tuesday and runs through July 13. The nation's largest retailer is making its summer deals available in stores as well as online for the first time.
Here's what to expect:
Will a longer Prime event lessen the urgency?
Amazon expanded Prime Day this year because shoppers 'wanted more time to shop and save,' Amazon Prime Vice President Jamil Ghani recently told The Associated Press.
Analysts are unsure the extra days will translate into more purchases given that renewed inflation worries and potential price increases from tariffs may make consumers less willing to spend. Amazon doesn't disclose Prime Day sales figures but said last year that the event achieved record global sales.
Adobe Digital Insights predicts that the sales event will drive $23.8 billion in overall online spending from July 8 to July 11, 28.4% more than the similar period last year. In 2024 and 2023, online sales increased 11% and 6.1% during the comparable four days of July.
Vivek Pandya, lead analyst at Adobe Digital Insights, noted that Amazon's move to stretch the sales event to four days is a big opportunity to 'really amplify and accelerate the spending velocity.'
Caila Schwartz, director of consumer insights and strategy at software company Salesforce, noted that July sales in general have lost some momentum in recent years. Amazon is not a Salesforce customer, so the business software company is not privy to Prime Day figures.
'What we saw last year was that (shoppers) bought and then they were done, ' Schwartz said. 'We know that the consumer is still really cautious. So it's likely we could see a similar pattern where they come out early, they're ready to buy and then they take a step back.'
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How will rising costs from tariffs affect discounts?
Amazon executives reported in May that the company and many of its third-party sellers tried to beat big import tax bills by stocking up on foreign goods before President Donald Trump's tariffs took effect. And because of that move, a fair number of third-party sellers hadn't changed their pricing at that time, Amazon said.
Adobe Digital Insights' Pandya expects discounts to remain on par with last year and for other U.S. retail companies to mark 10% to 24% off the manufacturers' suggested retail price between Tuesday and Friday.
Salesforce's Schwartz said she's noticed retailers becoming more precise with their discounts, such as offering promotion codes that apply to selected products instead of their entire websites.
Will shoppers stick to necessities or splurge?
Amazon Prime and other July sales have historically helped jump-start back-to-school spending and encouraged advance planners to buy other seasonal merchandise earlier. Analysts said they expected U.S. consumers to make purchases this week out of fear that tariffs will make items more expensive later.
Brett Rose, CEO of United National Consumer Supplies, a wholesale distributor of overstocked goods like toys and beauty products, thinks shoppers will go for items like beauty essentials.
'They're going to buy more everyday items,' he said.
What are some of the deals?
As in past years, Amazon offered early deals leading up to Prime Day. For the big event, Amazon said it would have special discounts on Alexa-enabled products like Echo, Fire TV and Fire tablets.
Walmart said its July sale would include a 32-inch Samsung smart monitor priced at $199 instead of $299.99; and $50 off a 50-Inch Vizio Smart TV with a standard retail price of $298.00. Target said it was maintaining its 2024 prices on key back-to-school items, including a $5 backpack and a selection of 20 school supplies totaling less than $20.
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How will Amazon's third-party sellers fare?
Independent businesses that sell goods through Amazon account for more than 60% of the company's retail sales. Some third-party sellers are expected to sit out Prime Day and not offer discounts to preserve their profit margins during the ongoing tariff uncertainty, analysts said.
Rose, of United National Consumer Supplies, said he spoke with third-party sellers who said they would rather take a sales hit this week than use up a lot of their pre-tariffs inventory now and risk seeing their profit margins suffer later.
However, some independent businesses that market their products on Amazon are looking to Prime Day to make a dent in the inventory they built up earlier in the year to avoid tariffs.
Home fragrance company Outdoor Fellow, which makes about 30% of its sales through Amazon's marketplace, gets most of its candle lids, labels, jars, reed diffusers and other items from China, founder Patrick Jones said. Fearing high costs from tariffs, Jones stocked up at the beginning of the year, roughly doubling his inventory.
For Prime Day, he plans to offer bigger discounts, such as 32% off the price of a candle normally priced at $34, Jones said.
'All the product that we have on Amazon right now is still from the inventory that we got before the tariffs went into effect,' he said. 'So we're still able to offer the discount that we're planning on doing.'
Jones said he was waiting to find out if the order he placed in June will incur large customs duties when the goods arrive from China in a few weeks.
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AP Business Writer Mae Anderson contributed to this report.