Adobe: Prime Day Expected to Drive $14B in Online Sales for US Retailers

This article was originally published on TotalRetail.

Amazon Prime Day, which has become an industry-wide moment as consumers embrace deals across retailers, will drive $14 billion online — a 10.5 percent increase year-over-year — for U.S. retailers, according to data recently published by Adobe Analytics. The event,  taking place July 16-17, will also bring steeper discounts, a rise in back-to-school shopping, and continued growth in buy now, pay later (BNPL) services.

Adobe expects the first day of the Prime Day event to drive $7.1 billion online, up 11.3 percent YoY. Day two is expected to generate $6.9 billion in online sales, up 9.2 percent YoY. Furthermore, day one is also expected to be the biggest mobile shopping day of the year so far, driving $3.4 billion in online spend, and representing a 48.4 percent share compared to desktop shopping, according to Adobe Analytics.

According to the report, strong spend will be driven by steeper discounts this year, expected to range between 9 percent and 22 percent (off listed price). Adobe expects electronics to have the biggest discounts at 22 percent (last year, discounts for electronics peaked at 14 percent). What's more, Adobe expects strong back-to-school spending online this year during the Prime Day event, as well as a substantial uptick in BNPL usage during the Prime Day event, driving between $1.09 billion and $1.11 billion in online spend across both days, and representing 18.1 percent and 19.6 percent growth YoY, respectively.

Total Retail's Take: July sales events have become a seasonal revenue driver for the retail industry since Amazon launched its first Prime Day back in 2015. In addition to Amazon, Walmart, Target, Kohl’s, and newcomers TikTok Shop and Temu have all launched summer promotions ahead of Prime Day in an effort to siphon off some of the e-commerce giant’s savings-hungry shoppers. Meanwhile, Macy’s will be rolling out what it calls its “best summer deals” during an eight-day discount event launching tomorrow.

Why are retailers offering so many summer discounts? According to the Associated Press, July sales help retailers attract customers who are looking to get a head start on back-to-school shopping, which is the industry’s second-most important shopping season behind the winter holiday period. The markdowns also pull in discretionary spending from shoppers who have had their eyes on gadgets, household products and seasonal items. Finally, discounts can help retailers combat a summer lull in spending as consumers shift their spending to summer vacations.