Join +750K new investors every month who copy stock picks from billionaire's portfoliosSign Up Free

Amazon's Prime Day-like event kick-starts holiday discount frenzy amid high inflation

Published 10/11/2022, 03:01 AM
Updated 10/11/2022, 03:42 PM
© Reuters. FILE PHOTO: The Amazon logo is seen at the company's logistics centre in Boves, France, October 6, 2021 REUTERS/Pascal Rossignol

By Aishwarya Venugopal and Ananya Mariam Rajesh

(Reuters) - Inc (NASDAQ:AMZN) fired up the holiday shopping season with its second major sales event of the year as rivals from Walmart (NYSE:WMT) to Best Buy joined in with discounts to woo customers grappling with inflation-squeezed Christmas budgets.

The two-day "Prime Early Access Sale" shopping event for Amazon members, which starts Tuesday, is much like the Prime Day summer marketing blitz and will compete with early discounts from rival retailers.

"Retailers will likely fight harder and earlier for potentially fewer dollars this year. The thinking is that the early bird catches the dollars," said Carol Spieckerman, president at consultancy Spieckerman Retail.

Walmart Inc is holding a "Rollbacks and More" sale event from Oct. 10-13 to counter Amazon's discount days, with deals on everything from Hot Wheels toys to luggage.

Kohl's Corp (NYSE:KSS) and Best Buy Co Inc (NYSE:BBY)'s 48-hour sale also runs on the same days as Amazon's event, while Target Corp (NYSE:TGT)'s "Deal Days" were from Oct. 6-8, avoiding a clash with Amazon.

"The middle- to upper-income consumer is likely to take more advantage of the current deals to get a jump on the holiday season ... at the lower end of the income spectrum, those consumers may hold off and buy closer to need," Telsey Advisory Group analyst Joseph Feldman said.

Inflation and early discounting is also expected to slow holiday spending for the year. U.S. online holiday sales are expected to rise this year at their slowest pace since at least 2015 and grow only 2.5% to $209.7 billion, according to Adobe (NASDAQ:ADBE) Analytics.

The early start to the holiday shopping season, however, does not come as a surprise.

Major retailers such as Target and Walmart have been giving big discounts for months to get rid of excess inventory that piled up as consumer's cut back on discretionary spending. Some of them even had competing deals when Amazon held its Prime Day sales in July.

© Reuters. An Amazon delivery worker sorts packages out for delivery during Amazon's two-day

At the time, Amazon raked in about $12 billion in sales, according to Adobe.

"This holiday season, retailers are resorting to blunt force promotions to coax shoppers," Spieckerman said.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.