Introduction

What’s the Story?

Amazon’s annual flagship sale event, Prime Day, will be held on July 23–24, 2022, in India—similar timing to last year but later than the mid-July Prime Day in the US and other Western markets in 2022. 

In this report, we present four key insights heading into Prime Day 2022, including product categories likely to witness a surge in sales, Indian markets offering sales prospects, Amazon’s continued support for third-party sellers and small offline businesses and the company’s offerings for the Prime Day 2022.

Why It Matters

Amazon’s sixth annual Prime Day in India will continue to support the country’s SMBs—including artisans, manufacturers, local shops, sellers, startups and brands, weavers and women entrepreneurs—to help generate online customer demand for their products. According to Amazon, Prime Day 2021 helped these businesses bounce back from the economic disruption caused by the pandemic. 

In India in 2021, during both the lead-up to Prime Day (the three weeks before the event) and the event itself, Prime members shopped from 126,003 sellers—a 38.5% increase from Prime Day 2020, according to Amazon. Furthermore, 31,230 sellers witnessed their highest-ever single-day sales, and about 25% more sellers—compared to 209 in Prime Day 2020—grossed over ₹10 million (around $134,000) during the event. 

Furthermore, Amazon stated that in 2021, Prime members placed orders in over 6,800 of India’s zip codes (more than 96%)–up by over 900 zip codes from 2020. Given the response from Indian Prime members last year, Prime Day 2022 will offer even more deals and entertainment, according to Akshay Sahi, Amazon India’s Director for Prime and Fulfillment Services.

Amazon India Prime Day 2022 Preview: Coresight Research Analysis

1. Prominent Product Categories for Prime Day Sales

During Prime Day 2021 in India, apparel, beauty, home & kitchen, large appliances, pantry and smartphones were among the top-purchased categories, according to an Amazon press release from July 2021. According to RedSeer, an Indian management consulting company, many of these categories also ranked highly during India’s online festival season overall (October–November 2021), which also includes major sales such as Amazon’s Great Indian Shopping Festival and Walmart-owned Flipkart’s Big Billion Days (see Figure 1). 

We expect some of these categories to rank highly again during this year’s Prime Day event.

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Figure 1. India: Sales by Category During the Online Festival Season* (% of Total Sales) [caption id="attachment_151560" align="aligncenter" width="550"] *October–November
Source: RedSeer[/caption]  

With schools and workplaces reopening and adopting hybrid models in India, apparel, fashion and footwear brands offering casual wear will witness spending similar to the festive season sale in 2021. Hybrid school and work will also prompt consumers to continue spending in the home and furniture categories. 

Despite the prices of home appliances increasing in June 2022 due to inflation and supply chain disruption, we expect consumers to spend heavily in this category during Prime Day 2022, given the various appliance discounts being offered. Amazon will specifically focus on selling its own electronics brands, such as Alexa, Echo and FireTV, at discounted prices. Inflation will also lead to increased sales in the food and CPG categories as consumers stock up on daily essentials thanks to Prime Day discounts.

Additionally, we expect smartphones to witness increased sales this year due to new and exclusive launches by many prominent smartphone brands, including launches from Korean consumer electronics company Samsung (Galaxy M13 4G and 5G) and Chinese smartphone manufacturer Xiaomi (Redmi K50i). 

2. Improved Participation from Tier 2, 3 and 4 Cities

Sellers and buyers from India’s Tier 2, 3 and 4 cities will continue to increase their participation in online shopping events and festivals in 2022, including Prime Day. During Prime Day 2021, out of the 126,003 sellers that participated, 68% were from Tier 2, 3 and 4 cities such as Barnala (Punjab), Valsad (Gujarat) and Virudhunagar (Tamil Nadu), according to Amazon.

The company also reported that, among the new members that signed up for Prime Day 2021, over 70% came from Tier 2, 3 and 4 cities—up from 65% in 2020—including Ananthnag (Jammu and Kashmir), Gadag (Karnataka), Kasargod (Kerala) and Tawang (Arunachal Pradesh). The online festival season overall in India witnessed increased participation from Tier 2, 3 and 4 cities (see Figure 2), according to RedSeer: more than six in 10 shoppers were from these locations. 

Following the positive response from sellers and consumers from Tier 2 cities and beyond in 2021, we expect this trend to continue for Prime Day 2022.

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Figure 2. India: Online Shopper Base by City Tier During the Online Festival Season* (% of Shoppers) [caption id="attachment_151561" align="aligncenter" width="550"] *October–November
Source: RedSeer[/caption]  

3.  Amazon India’s Continued Support To Digitally Empower SMBs

In June 2022, Amazon signed an agreement with small and medium businesses (SMBs) to digitally enable and onboard local stores, artisans and traders across the Indian state of Uttar Pradesh, helping them grow their business and providing access to customers pan-India. Amazon also opened a Digital Kendra—the company’s brick-and-mortar resource centers that help digitalize local stores—in the state as part of this initiative. As a result, we expect that these sellers will have wider access to customers and improved sales prospects during the upcoming Prime Day event.

To further support SMBs and third-party sellers, Amazon has also launched several other programs, including: 

• Amazon Karigar, a program to help artisans, weavers and makers of handicrafts and handloom products to sell their products on Amazon.
• Amazon Saheli, a special initiative to encourage female entrepreneurs in India. 
• Amazon Launchpad, a program to assist emerging brands and startups to grow.
• Local Shops on Amazon, an initiative to register physical stores on Amazon, expanding their local customer base.

Prime Day 2021 saw successful offers and deals for Prime members from over 1.2 million artisans through Karigar, 680,000 women entrepreneurs through Saheli and hundreds of emerging brands through Launchpad, Amazon claims. Now, Prime Day 2022 will feature more than 120 SMBs under the Karigar, Saheli, Launchpad and Local Shops programs, bringing more than 2,000 product launches and offers to the event across various categories, according to an Amazon press release dated July 6, 2022. During the lead-up to Prime Day (July 7–22 this year, per the company), members who shop from SMBs can earn 10% cashback—up to ₹100 ($1.30)—to redeem on Prime Day purchases.

4. Amazon’s Prime Day Offerings and Promotions in India

Below, we detail some of the offerings that will feature in Prime Day 2022, as advertised by Amazon. 

Product Launches and Offerings

• Prime Day 2022 will offer more than 30,000 new product launches from over 400 top Indian and international brands, including Adidas, Boat (wearable devices brand), Fastrack (lifestyle brand), Mamaearth (beauty and personal care brand), Puma and Xiaomi (smartphone brand). 
• The product launches will span multiple categories such as beauty and accessories, books, consumer electronics, daily essentials, fashion, furniture, gaming, home & kitchen, large appliances and toys.

Deals, Discounts and Offers

• Headline deals this year include: 
  • Up to 40% discounts on books, mobile phones and accessories, toys and video games
  • Up to 50% discounts on appliances and TVs
  • Up to 55% discounts on Alexa, Fire TV, and Kindle
  • Up to 60% discounts on daily essentials
  • Up to 70% discounts on home & kitchen
  • Up to 75% discounts on computer accessories, headphones and laptops

[caption id="attachment_151562" align="aligncenter" width="550"] Headline deals for Prime Day 2022
Source: Amazon India[/caption]  

• During Prime Day 2022, Amazon India will present the “Save Big” offer, which gives an instant 10% discount for consumers using an ICICI Bank debit or credit card, an SBI credit card for payments or equated monthly installments (EMI)—a fixed payment system—as payment.
• Prime members who use Amazon Pay (a payment-processing service that allows Amazon users to use the payment methods already linked with their Amazon account on external sites) for utility bill payments and peer-to-peer transactions during the lead-up to Prime Day can earn rewards up to ₹2,500 ($31.40). 
• Prime members using an Amazon Pay ICICI Bank credit card for payment can enjoy 5% cashback on all Prime Day purchases, with no limit.
• Amazon is once again providing the Prime Youth Offer, where customers in the 18–24 age group can earn a 50% discount on Prime membership.
• Prime Day 2022 in India will feature “WOW Deals” (extreme discounts) in certain categories, such as earphones and accessories, between 4:00 p.m. and 6:00 p.m on July 23.

Entertainment and More

• Prime Video is debuting many highly-anticipated web series and films across multiple regional languages, including Hindi, Kannada, Malayalam, Tamil and Telugu, during the lead-up to Prime Day, with more movie premieres happening closer to—and on—Prime Day.
• Prime Video partners such as Discovery+, Eros Now, Lionsgate Play and Manorama Max will offer up to 50% discount on add-on subscriptions during Prime Day 2022.

[caption id="attachment_151563" align="aligncenter" width="350"] Regional language movie and web series releases on Prime Video
Source: Amazon India[/caption]  

• Amazon Music will provide an immersive music experience for Prime Day 2022, including the debut of new playlists in regional languages. The Hindi and Telugu playlists will be titled “Desi Vibes” and “Fully Tolly,” respectively. Prime Music will also feature exclusive releases from renowned artists such as AR Rahman, Jubin Nautiyal and Ritviz on Prime Day.
• Prime Reading will offer 18 bestselling ebooks across the children’s, fiction, history, investing and philosophy book categories for free.

What We Think

We expect Prime Day 2022 to boost the current quarter revenues for Amazon India. Amazon’s placement of Prime Day during the traditional timeline in July will likely lead to better sales, as Amazon’s competitors do not have any recurring events lined up for the same period. The timing will also allow Amazon to earn a new member base that will serve as prospects for its upcoming sale events, such as the Great Indian Shopping Festival. 

With ongoing supply disruptions and soaring inflation across most categories—as well as India’s growing digital payment ecosystem—consumers are likely to take advantage of Prime Day deals, discounts and offers for their discretionary purchases. Meanwhile, sellers will benefit from opportunities to augment their digital presence and expand their sales prospects for upcoming online shopping events. 

Implications for Brands/Retailers

• Brands and retailers in India should make use of the digital onboarding programs offered by Amazon to create an online storefront, expanding their business and customer base. They can also leverage online shopping events like Prime Day 2022 to provide attractive products and offers to these customers, thereby retaining them. We expect Amazon to launch its annual Great Indian Festival in September/October, and Prime Day offers sellers on Amazon.in an opportunity to prepare for that event. 

Implications for Technology Vendors

• Shopping events often lead to shipment delays due to a massive spike in sales. Technology companies in the last-mile delivery space and those that offer tech-powered supply chain solutions should partner with e-commerce players to upgrade existing systems to meet the spike in order fulfillment ahead of the event.