NEW YORK — It’s summer and bargains seem easy to find at a time when many consumer prices are high.
The July sales events have become a seasonal sales driver for retailers since Amazon launched its first Prime Day in 2015. consumers can be Lured by advertised, unmissable savings on some products, personal finance experts say buyers should be careful not to fall into the trap possibly misleading marketing or impulse purchases.
Amazon has raised expectations for its 10th Prime Day Eventwhich is held on Tuesdays and Wednesdays and is only open to customers who pay $14.99 per month or $139 per year to receive free shipping and other benefits Prime members.
Rival retailers In the past, retailers have tried to capture some of the Prime Day excitement by offering their own discounts during the two-day event. This year, Walmart, Target, Kohl’s, and newcomers TikTok Shop and Temu launched summer promotions before Amazon, hoping to capture some of the e-commerce giant shoppers hungry for savings. Meanwhile, Macy’s will roll out its “best summer deals” during an eight-day discount event starting Tuesday.
The July sales help retailers attract shoppers looking to get a head start on back-to-school shopping, the industry’s second-most important shopping season after the winter holiday season. The discounts also attract some discretionary spending from shoppers eyeing gadgets, home products and seasonal itemssuch as a bikini or a new summer dress.
Discounts can help retailers combat the “summer slump in retail spending” as consumers shift their spending to other stores. summer vacations and services such as dining out at restaurants, said John Mercer, head of global research at Coresight Research.
“It does create some excitement in that mid-year period,” when retailers might otherwise struggle to generate more sales, Mercer said. Companies have also relied on discounts to boost consumer spending during the recent period of inflation and high interest rates, he said.
Amazon doesn’t disclose how much revenue it makes from Prime Day, but it has given some indications of its success. The company said last year’s event resulted in the “biggest sales day” in the company’s history, with customers purchasing more than 375 million items.
According to an estimate by market research firm Emarketer, Amazon’s global Prime Day sales will rise to $12.5 billion in 2023. The company predicts sales will grow by about 7% this year.
That depends on who you ask.
Retailers advertise their promotions to draw in customers. But the New York Times-owned website Wirecutter published an article this month saying that most of Amazon’s early deals so far this year “stink.”
According to Kirthi Kalyanam, a business professor at Santa Clara University and author of a book about Amazon, Prime Day deals have historically been good. That’s because the company has been able to get discounts from big-name brands like Apple and incentivize third-party sellers to drop their prices by promising to prominently display them on Amazon’s website, Kalyanam said.
But Prime Day discounts may be less important these days, as customers become accustomed to the ultra-cheap products sold by Amazon’s competitors. Shein and Temuboth of which were founded in China.
“A lot of the deals may not be as competitive compared to Temu and Shien,” Kalyanam said.
At the same time, he noted that competing retailers will likely look at Amazon’s prices and try to match them overnight. Last week, he said he saw Best Buy markdown two products after Amazon unveiled some of its early deals.
Consumer data firm Numerator reported that a majority of the roughly 5,000 Prime Day shoppers it surveyed after last year’s event saw product discounts of up to 40%. Survey respondents said they saw a quarter of items discounted by 60% or more.
Some shopping experts have said that previous Prime discounts weren’t as big as they seemed.
If you keep an eye on your budgetAccording to personal finance experts, you should be careful before buying anything.
“Avoid the false sense of urgency of manufactured holidays,” advises Mark Elliot, chief customer officer at financial services provider LendingClub. “The idea that ‘the more you spend, the more you save’ — that’s just inherently not true.”
Dan Egan, vice president at financial advisory and investing firm Betterment, says shoppers should make a list of what they need before sales start to make intentional purchases. He also encourages consumers to avoid shopping late at night or out of boredom.
“Once you have a list, you’re less likely to get distracted by things you don’t need,” Egan said. “If that list has almost nothing in it, I would say delete the (retailer’s) apps from your phone for the next week or two. Otherwise, you’re going to get a lot of notifications.”
Anyone who already has credit card debt should be aware that the interest paid on that debt could wipe out any savings you made during the summer sales, he added.
“A deal isn’t a deal if you have to pay interest on it,” Egan said.
While it may make sense for shoppers to try out free or limited-time memberships to qualify for the best deals during the summer sales, such programs typically charge the credit card the customer has on file after a short time, said Erin Witte, director of consumer protection for the Consumer Federation of America.
“Set a calendar reminder to cancel if you don’t want to continue that subscription,” Witte said. “Think about that right at the beginning. And remember, these companies are designing this product to be easy to sign up for, but harder to cancel.”
Consumer Reports also offers a few tips: Download Amazon’s app, sign up for invite-only deals available to a select group of shoppers, and put yourself on the waitlist for limited-time deals that have already sold out.
Filling up an online Amazon cart is tempting for Prime members, since they pay for access to Prime Day deals. But it’s always a smart idea to compare prices across multiple sites before making a purchase.
Unlike Prime Day deals, Walmart’s discount event this month was open to everyone. However, the company sweetened the deal for its Walmart+ members by offering them early access.
Target offered discounts only to customers who signed up for its Target Circle loyalty program and used the week-long event to promote a new membership program aimed at boosting sales and traffic.
TikTok Shop, the e-commerce arm of the popular video sharing appopened its summer sales event to everyone. The event started on July 9 and will last until Wednesday.
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