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Amazon to delay prime day to August, but VoD services could fill the gap

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Amazon Prime Day has become the latest victim of Coronavirus uncertainty, with the marketplace planning to defer this year’s event to at least August – and is likely to take a multi-million dollar hit in the process, according to meeting notes seen by Reuters.

While Amazon never usually reveals the date of Prime Day this far in advance, it is thought that the impact of Coronavirus on sales and delivery, warehousing and prioritising some goods over others will continue to be impacting the retailer by July.

The retail giant is likely to take a hit of as much as $100million on devices it planned to sell in the run up and during Prime Day that it will now have to offload at a discount, the internal documents suggest.

“We probably have to promote sooner, which will be difficult if we’re capacity constrained,” General Counsel David Zapolsky wrote in notes from a daily meeting of Amazon executives. The notes said this would result in a $300 million impact “worst case,” with a $100 million hit being more likely. 

It was unclear how solid the estimates were or what the impact to Amazon ultimately would be. 

The company does not disclose revenue from the event, but has said merchants contributed to $2 billion in sales during Prime Day in 2019, which spanned 48 hours and 18 countries.

Promotions for members of Amazon’s loyalty club, Prime, have also proven an effective way for the company to draw more people during the event to subscribe, at $119 per year in the United States.

On the up-side, Amazon’s video-on-demand service is looking likely to generate an additional $100million this year for the company as more consumers are turning to it for entertainment during lockdown.

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