Amazon prime day: The unbeatable combination of e-commerce and content

Armed with innumerable exclusive deals, two-hourfast delivery options and seven back-to-back premieres, Amazon’s Prime Day Sale has got the whole world listening to the beats of its discount season.

Competitor Flipkart, which has recently got Walmart as a major investor, has too lined up its big shopping days festival starting July 16 and ending on July 19.

The Prime Power

The offers and deals would mostly be mirroring each other on both platforms. But Amazon has done this with a twist. Considering the nature of the Prime Day sale, it is not open to all the public but only to Prime members, a premium subscribers’ club. Prime Day Sale was started by Amazon in 2015 though it was launched in India only in 2017 when the company boasted of a 60% increase in sales globally on this day. What still remains unknown through is the number of new members added to the premium club, whether this 60% increase is over a typical sale day or is it over a regular day on Amazon. In fact, a set of questions sent to Amazon India remained unanswered at the time of filing this report.

Just to toss some numbers about previous e-commerce sale seasons in India, Flipkart in its Big Billion Sale of September 20-24, 2017, did sales that doubled over 2016’s BBD. It registered close to 70% sales out of the total Indian online e-commerce market. Buying out Myntra (and Jabong) gave the homegrown e-commerce player command over 80% of the online fashion market.

Coming to Amazon’s The Great Indian sale of 2017, which went on from September 21-24, the e-commerce giant revealed that on the first two days, every third order was booked by a Prime member.

A full powered ad campaign fuelling sales

Back to the 36-hour sale marathon – Prime Day 2018 – Amazon has not left any option untouched. The company has painted all the media platforms in the colour of Prime Day, as market estimates suggest that the company has spent close to Rs 25-30 crore in marketing till the start of the discounting festival on July 16. One can see innumerable hoardings across the major cities of Mumbai, Delhi and Bangalore among others.

Amazon has invested in all the impact digital properties to get massive reach and customer acquisition. They have done few marvellous tie-ups. One of them was on BookMyShow, where the company bought the masthead that said, ‘Watch Raazi on Prime Video.’ The movie is still running at a few multiplexes across the nation. They have done a mix of mass media (TV, outdoor, print and radio) and some key impact sites on major digital platforms. This coupled with a massive digital customer acquisition campaign, suggested a seasoned professional in the online content segment, leading an OTT brand in India.

Video service acting as glue for users

Even the seven premieres offering on Prime Video is being counted as a key marketing strategy for the sale announcement. The global strategy of the company is that e-commerce is their primary business, Prime Video and Prime Music being the customer acquisition tools.

All the experts agreed that, “All the content offerings of the company have to lead up to higher e-commerce sales. The more online videos you watch, the more mobile phones get sold on the platform.”

However, as the company is moving ahead, it is creating stronger symbiotic relationship between its content and commerce verticals. A consumer might not pay so much only for the ‘fast delivery’ or ‘extra discounts’ offer, while another consumer might not pay for content for the whole year, just to watch select content that he/ she is interested it.

“It is both an acquisition and retention strategy. The two offerings fill in the void of each other,” said an expert.

Subrat Kar, Co-Founder and CEO, Vidooly, suggested, “The Indian consumer is still not ready to pay for content. Though the mindset is building up, we are still not there yet. With the specialised e-commerce services, Amazon fills the gap and justifies the subscription costs.”

According to the RedSeet analysis, the total e-retail market clocked close to US$ 1.5 billion in festive season sale in 2017, against a US$ 1.05 billion in 2016. India is expected to reach US$ 64 billion by 2021, which makes this the best e-commerce market to be in. No wonder Amazon entered this market with huge ambitions and preparations. As a result, along with its content-led-marketing strategy and everything else, Amazon today had about 0.61 million subscribers by the end of 2017, against Netflix’s 0.52 million, according to IHSMarkit, a London-based firm.

Refusing to comment on the subscription numbers, Kar added, “While Amazon has been able to drive strong subscription base, the ultimate aim for the company is to drive sales on the e-commerce platform. Even for the Prime Day, the 7 Premieres offering was a clear marketing strategy. They have proved that this strategy works in other markets like the US and other markets.”

In a letter to the investors, Amazon’s Jeff Bezos had mentioned that India is one of the most important and fastest growing markets for the company. He mentioned, “Prime added more members in India in its first year than any previous geography in Amazon’s history. Prime selection in India now includes more than 40 million local products from third party sellers, and Prime Video is investing in India original video content in a big way, including two recent premiers and over a dozen new shows in production.”

Forrester has suggested that Amazon is inching closer to its arch-rival in India, Flipkart, as Amazon has taken 31.1% market share in terms of GMV against a 31.9% of Flipkart.

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