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Amazon's (record) Prime Day highlights its defining strategy: the "flywheel"

Snacks / Thursday, July 18, 2019

Even Siri knows it... Sales on Amazon's Prime Day surpassed both its Black Friday and Cyber Monday. Combined. A record 175M items were snagged — up 75% from last year. Some of that's thanks to T-Swift's kick-off concert, most is from the 18 countries now taking part. Here are your worldwide best-selling items (straight from Amazon's brag sheet):

  • US: Personal water filter straw, 23andMe ancestry kits.
  • UK: Sony PlayStation (FYI, Mexico loved Nintendo Switch, while Australia's top-seller was Mario Kart 8 Deluxe).
  • China: Dove exfoliating scrub.
  • Italy: Nescafé espresso (classic).
  • Germany: Some very, very practical stainless steel pans.

Add "Halo Effect" to the shopping cart... That's the impact Amazon's mid-summer splurge-fest had on the rest of retail as everyone launched their own mini-sales.

  • The positive: Sales surged 68% at big non-Amazon retailers and 28% at small ones.
  • The negative: Discounts drove those sales — retailers desperately race to the bottom on prices on Prime Day. Great for us, not really great for the companies.

"Flywheel effect" is bigger than "halo effect"... The flywheel is what Amazon biographer Brad Stone called the company's "secret sauce" — the self-reinforcing wheel that Prime Day is now a spoke in. Here's the cycle: Prime members shop big on Prime Day (to justify the $119/yr membership) and they bought Alexa products for their homes — Echo Dot and other voice assistant products were the top sellers this week. Now those primers will do even more with Amazon, thanks to Alexa's help.

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