Amazon’s flagship Prime Day event begins in India today.
The annual two-day sales event offers steep discounts on a wide array of products, with sales timed to drive consistent traffic to the platform. The manufacturers’ sales holiday is yet another tactic used by the organization to bring members into signing up for their Prime subscription service and keeping them within their ‘walled garden’ ecosystem; Amazon also partnered with Uber to launch special ride upgrades for Prime customers recently in the same vein of strategic business ventures to assure consumer retention.
Prime Day may nevertheless not be as voracious of a spending holiday as it normally is, given the severe on consumer spending in India due to global inflationary pressures. As of June 2022, consumer spending in India, for both discretionary and non-discretionary spending was down 18 percent. Retailers are concerned that this reluctance and inability to spend may also affect purchases for and during the upcoming festive season.
Expect that Prime Day—with its significant discounts—will cause a temporary spike in discretionary consumer spending, especially in urban areas. However, with continuing inflationary pressures, expect that spending trends will not return to pre-pandemic levels in the medium run.
Shravan is an Analyst at Foreign Brief and a graduate student at the Paris School of International Affairs, Sciences Po, where he is developing specialties in Asian Studies and Intelligence. His specific interests are in military affairs, international security, space law and nuclear disarmament.