Amazon readies for Prime Day blitz with 45,000 launches, faster deliveries in 25 cities

E-commerce sector is looking to bounce back from a slowdown due to inflation pangs, funding crunch for private e-commerce players who relied on discounts, and returns and refund policies favourable to customers

Amazon is gearing up for its biggest Prime Day blitz in India yet, with over 45,000 product launches and fast deliveries to 25 cities lined up for the two-day deals extravaganza on July 15th and 16th, at a time when the e-commerce industry is looking to bounce back from a slowdown in sales growth.

“Prime Day will bring the lowest prices of the year across all the categories. We have 45,000 plus new launches coming in this year which I think is the largest ever. There is participation from the biggest brands whether it be Samsung, One Plus, Maybelline or Tatas, which shows the excitement of the seller ecosystem,” said Akshay Sahi, Director, Prime and Delivery Experience, Amazon India.

Members of Amazon’s loyalty programme ordering from the top 25 cities will be able to avail same day or the very next day delivery of their orders, while Prime members shopping from most tier II cities will have their Prime Day delivery within 24 to 48 hours.

“On Prime Day last year, I think, we had 150 percent more signups versus regular, which is pretty consistent with the way Prime Day moves. Even when I look at this year, I don't see a slowdown either in our regular performance. Obviously, there are categories which go up and down – with the rains this month, we don't know what's going to happen to air conditioner sales, for example,” he added.

However, according to consulting firm Redseer, e-tailing gross merchandise volume (GMV) grew by about 44 percent from $25 billion in FY20 to $36 billion in FY21. And then the GMV further increased by around 36 percent year-on-year (YoY) to $49 billion in FY22. However, the pace of YoY growth slowed sharply to 22 percent in FY23 when the GMV increased to $60 billion.

The sector's slowdown is attributed to inflation pangs hitting consumer demand, funding crunch for private e-commerce players who relied on discounts, and returns and refund policies favourable to customers.

In an earnings call last quarter, Sahil Barua, chief executive of logistics firm Delhivery, which counts almost all major e-commerce players as its customers, had predicted that the e-commerce sector’s growth will remain muted at 15-20 percent this year.

Smartphone deals lined up

While Amazon has lined up a bevy of launches and discounts in the segment from top brands like Samsung, Xiaomi, OnePlus, Lava and Nokia, industry insiders say that online purchase of handsets has come down by 20 percent in the June quarter, according to an analyst from a consulting firm that tracks smartphone sales.

The smartphone segment, which has historically dominated the e-commerce space in India, is said to be slowly waning in its share of the online wallet.

“When you see it from another perspective, offline smartphone sales have performed better as the segment suffered a lower rate of slowdown at 16 percent. But, I expect the Prime Day deals to act as a push this month,” he said.

“The main issue has been that while many are waiting to upgrade to 5G for their next smartphone buy, brands have not been able to launch enough models in this segment at the Rs 10,000-Rs 15,000 price range. That’s why consumers are holding back,” he added.

Although mobile phones dominated the category divide in FY19, in FY23 fashion was the single largest category with a share of 27 percent whereas beauty and person care (BPC), grocery and home categories are the fastest growing categories, thanks to an increasing share of women shoppers has resulted in an explosion of fashion sales, according to consulting firm Redseer.

In the fashion and beauty segments, Amazon said that it has lined up offers with discounts up to 80 percent for the Prime Days event.

There are discounts to the tune of 70 percent on beauty products and easy returns on brands like Maybelline, Renee, Plum, Nivea; 50-80 percent off from brands like Adidas, Puma, Skechers, etc in footwear; 50 percent discounts on luxury beauty brands like L’Oreal Professional, Forest Essentials, Kama Ayurveda; and 50-80 off on jewellery from brands like Fashion Frills, YouBella, Shining Diva.

Interestingly, Nykaa, which is one of the biggest players in the online beauty and personal care (BPC) segment, said last week that despite overall discretionary spend slowdown, consumption in these categories continue to remain strong. It expects its BPC sales to grow in the early twenties year-on-year in the June quarter, supported by strong urban demand in the category.

Sahi of Amazon India said that it’s not just the big legacy brand or well-funded startups who are driving sales on the platform.

“Programs like Saheli, Karigar, Launchpad have grown in size because people are seeing business. People are seeing that I can discover customers across the country who want my stuff. We have so many new launches coming because sellers trust the ecosystem to actually get the performance. We have over 2,000 launches coming from small and medium sellers this time,” he added.