An Historic Week for E-Commerce?

This past week could end up as a footnote in e-commerce history. Last Wednesday Amazon had the temerity to inaugurate its own special shopping day, promising that it would rival Black Friday, and naming it after its $99-a-year Amazon Prime membership program. Prime Day got panned by the mainstream media, which seems to have abandoned bona fide business experts in favor of social media posts as the primary sources in their reporting. Social media is hardly the workhorse of commerce. The Direct Marketing Association’s “Response Rate Report” notes that only 30% of marketers use social media in campaigns, compared to 50% for direct mail and 82% for email. But most news outlets focused on comments from peed-off shoppers who failed to get to their buy buttons in time to get in on Prime Day’s Lightning Deals. Their verdict: Amazon laid an egg.

What Amazon more likely laid was a foundation for a bigger base of Prime Members and a claim to ownership of what could be the key summer sale day for years to come. Flat-footed competitors like Walmart and Sears double-promoted their planned summer sales to get noticed on Prime Day, but they lacked Amazon’s aura of exclusivity. Americans want not just cheap merchandise, but bragging rights. They want to crow to the neighborhood that they scored the $159 widescreen HDTV on Black Friday, that they attended the Super Bowl, that they were present at the presidential inauguration. Exclusivity breeds attention and polishes brand value. So, when Walmart reacted to Prime Day by offering deals for 30 days and not making anybody join an exclusive program to get them, it missed the point. Thirty days is not a special event; 30 days is a month.

Channel Advisor, a provider of optimization software for third-party sellers on Amazon, reported that its clients transacted Prime Day business equal to 97% of Black Friday 2014. In a survey of members of the online shopping community SheSpeaks, two thirds said they made Amazon purchases on Prime Day versus only one fifth who said they bought from On the social front, mentions of Walmart were flat on the big day, according to the Adobe Digital Index, but Amazon’s were up 50%.

There are some wags in the e-commerce world who venture that Amazon’s true impetus for Prime Day was to sign up as many subscribers as it could before could launch this past Tuesday. Amazon, the all-powerful master of online retail and customer service, worried about a competitor? Sounds unlikely, yet Marc Lore and his brand new online marketplace could one day elicit concern from Jeff Bezos and company.

Bezos slashed diaper prices on to sweat Lore into selling him his successful site. Lore wasted little time putting the $600 million bounty to work on a return engagement with Bezos via He amassed a VC warchest in excess of $220 million to give him time to expand product selection and build a clientele that would allow him to wrest customers from Amazon. By looking for profits from membership fees only and not taking a cut of sales from third-party sellers (as does Amazon), Lore expects those sellers to provide him the lowest prices online.

Insiders think Lore’s epic quest could prove successful. Third-party sellers are flocking to the Amazon alternative, says ChannelAdvisor CEO David Spitz, as are retail partners including Macy’s, J.Crew, and Crate&Barrel. Feedvisor CMO Shmuli Goldberg, whose living it is to help sellers find the optimal price to charge on Amazon, says that about 14% of online shoppers care only about price. “That’s enough for Jet to build a business on,” he notes.

In the digital marketing world, the prime change agents are innovation and disruption. The e-commerce world this week was rife with both. We’ll watch to see if it was enough for history to have been made.

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