In 2015, Amazon introduced Amazon Prime Day as a marketing initiative designed to boost summer sales and promote awareness of its Prime membership program. Now an annual event, Amazon Prime Day happens every July, which is historically a slow month for sales and offers some of the online retailer’s biggest discounts of the year. Find out how Amazon has handled increased Prime Day demand and take a look at the retailer’s Prime Air fleet.
Situation: Amazon Anticipates the Biggest Prime Day Yet
Prime Day has quickly become Amazon’s most lucrative day of the year, with sales numbers even larger than those from Black Friday or Cyber Monday. In 2017, the e-commerce giant ensured that the 2017 Prime Day event would be even bigger than the last in terms of both sales and new Prime memberships. Since Prime members spend almost twice as much as regular Amazon shoppers, attracting more sign-ups is a smart way for the e-commerce brand to continue to build its online retail empire.
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Amazon also extended its standard shopping window by six hours, turning Prime Day into a 30-hour event. With deep discounts on countless items and shoppers from over a dozen countries participating, Amazon set the stage for the biggest Prime Day yet. To ensure that every purchase arrived on time, however, the retailer needed to make key supply chain adjustments.
Approach: Amazon Introduces Its Prime Air Fleet
For years, Amazon has taken concrete steps to gain more control over the complex logistics that keep the online retailer running around the clock. In spring 2016, Amazon partnered with air cargo provider Atlas Air, from whom the e-commerce giant leased over three dozen jets.
To tackle the massive influx of orders on Prime Day, Amazon announced the debut of its Prime Air fleet, about 40 jets outfitted in partnership with Atlas Air.
Impact and Advantage
Amazon’s plans to engineer the most lucrative Prime Day yet proved successful, and its Prime Air fleet appears to have met the challenge head-on. Forbes reports that the 2017 Prime Day event generated 60 percent more sales than the same period during the previous year, even taking into account the slightly longer time period of this year’s event. Overall, Amazon produced an estimated $2 billion in sales and recorded more Prime membership sign-ups than any other day in the company’s history.
The e-commerce company’s Prime Air fleet helped ensure that packages arrived right on time, even with the shorter delivery window that Prime members receive. In fact, the Prime Air delivery service can accommodate a much later purchase time cutoff, which saves Amazon time and money while making shopping more convenient for customers. Since the fleet flies directly from one point to another, rather than relying on transit hubs, Prime Air can reduce cross-country shipping time by up to 15 hours.
Debuting Prime Air for the purpose of Prime Day enabled Amazon to test its latest technology, potentially paving the way for more in-house logistics. As Amazon continues to expand its footprint, its supply chain management methods are likely to set the pace for the industry and offer a glimpse of what’s to come.[/show_to]
