Why Amazon put services in the spotlight for Prime Day
Amazon shoppers snagged deals on food delivery, travel and healthcare during a two-day Prime Event that ended on Wednesday, highlighting the potential for growth in services at an e-retailing giant long focused on goods.
Amazon's 200 million U.S. Prime members snapped up $12.7 billion in merchandise, a record sum representing year-over-year growth of 6.1%, according to Adobe Analytics, with many seizing on discounts to load up on back-to-school supplies.
The sale of services and experiences might not have made a huge impact on its bottom line as yet, but Amazon could be hoping that will change over time.
"Amazon has extracted all of the value that it can from being merely a pass-through of goods, and is trying to move up the value chain," said David Klink, an analyst at Huntington National Bank whose bank owns $160 million in Amazon stock.
"(It's) a decision that we're also seeing with Walmart with its own decision to offer various services like Paramount with the Walmart offering," Klink said.
Amazon did not immediately respond to a request for comment on the shift to include services.
Along with discounts on leading categories such as apparel and electronics, Prime Day shoppers received exclusive deal codes or discounts for hotel bookings with Priceline, Grubhub restaurant delivery and Amazon's membership-based telehealth service One Medical.
Klink said Amazon's Grubhub and Priceline partnerships are an "extension of their existing advertising strategy." He said Amazon's non-traditional partnerships are an attempt to "make retail cool again."
"If the Amazon site is where the people are at, then brands like Grubhub or Priceline want to meet the consumers there," Klink said.
Amazon's broader partnership with Grubhub, launched in
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