If you haven’t seen the ads that have been peppering Australian television and media over the past week, Amazon Prime Day is coming on June 21 and 22 which means there’s going to be a flurry of retail activity that ASX investors can keep an eye on.
Although Amazon’s entry in the Australian market is relatively new, Morningstar analysts estimate the eCommerce giant to increase its current 3% share of online retail in Australia to 13% by 2025 and 25% by 2030.
The Prime Days themselves, are sales created by Amazon where it offers extensive discounts on goods while using the event to bundle its own products as an effective means to reduce inventory and bring in fresh stock.
Amazon’s Echo Studio smart home devices for example, have already been flagged for a discount to $229 from its regular $329 retail price as part of Prime Day festivities. To take advantage of the discounts, customers must join the Amazon Prime program but membership starts from $6.95 per month.
Given the concept of Prime Day is still very new to Australians, sales data from their global operations highlight the scale that it can grow to.
For their most recent Prime Day in October 2020, 3rd party sellers generated more than USD $3.5 billion in Prime Day sales, a 60% increase on their previous year. From those sales, Prime members saved more than $1.4 billion over the 2-day event.
So what might this mean for ASX investors?
With sales expected to flow on June 21 and 22 based on the substantial marketing expense which Amazon began rolling out last week, ASX-listed companies with ties to Amazon could see surges in online traffic throughout the sales bonanza. Based on the seller rankings on Amazon Australia, there are only a handful of listed companies that feature in the top 500, with one in particular coming in at Number 1 overall.
Harris Technology (ASX: HT8)
Harris Technology is the Number 1 ranked seller on Amazon Australia, offering a product range expected to thrive this week as Australian’s take advantage of tax-time purchases as part of the wider End of Financial Year sales. Increased time spent working from home through the pandemic has increased demand for tech products offered by Harris such as computers, consumer electronics and gaming products.
Harris recently highlighted their 100% customer review rating where the retailer had sold more than 4,500 products in the past year without a single negative review.
In the most recent Amazon Prime Day, the Company recorded a single-day sales record in 2020 but has significantly increased its operations and product range since. As of 31 March 2021, Harris Technology’s year-to-date sales were up more than 300% on the previous year at $30 million.
Emerald Financial recently released an Analyst report on Harris Technology which can be accessed here.
*Owners of this website are HT8 shareholders