Has Prime Day Lost Its Luster?
Delivery lockers in NYC, foodtech valuations flat, grocery deliveries up
It’s the most wonderful time of the year! 🎵 Unless you’re the mail carrier, in which case you’re certainly taking a few extra Aleve, as you prep for the delivery deluge associated with Prime Day. But is today really that big of a deal for Amazon, or is it actually more important for all the other brands that have launched their own “holidays”? We investigate…
Who Cares About Prime Day?
Parcel Lockers Hit the Big Apple
Chart Time | Foodtech & Delivery Valuations Hold Steady
Delivery Catches up with Pickup
ECOMMERCE | Has Prime Day Lost Its Luster?
As shoppers frantically head to Amazon’s website, it’s worth asking if this “holiday” has lost some of the shine it had when Amazon first concocted it in 2015. That’s not to say it’s not a huge day for sales: last year The Everything Store sold 300 million items on Prime Day, which has actually lasted 48 hours since 2017. Because the holiday is so huge, consumers no longer get the same deals — what used to be the whole world celebrating identical $99 TVs has become everyone seeing a slightly different discount on personalized search results.
The Big Picture: Investors don’t seem to care much about Prime Day, as they recognize that most of Amazon’s profits come from AWS, not merchandise. In the past four years, Amazon’s share price has fallen the week of the event; so far this week is shaping up that was as well. If anything, Amazon’s competitors have made it their own big deals, witness Walmart Plus Week, Target Circle Week, Best Buy’s Black Friday in July, etc. So, are you running a sale today?
POLICY | Delivery Lockers Invade NYC
Who knew the humble parcel locker was going to be such a revolution? What started as the “Packstation” in Europe around the turn of this century really took off when Amazon began unveiling its own branded lockers in 2011. Now seemingly every retailer and delivery service has a brightly branded box of its own. Even cities are getting into the game, this week NYC announced a partnership with GoLocker to establish 15 parcel lockers on city sidewalks, in a project called LockerNYC.
The Big Picture: The project aims to cut down on both delivery congestion (by centralizing drop-offs) and package theft (supposedly up to 90,000 NYC deliveries are stolen or lost per day.) Given that most Manhattanites don’t have a yard to toss a box or hot bag in, it’s a particularly challenging geography for delivery services. While high-end buildings usually solve the problem by employing a doorman, this initiative looks to serve everyday consumers, in a brand neutral fashion.
CHART TIME | Foodtech Valuations Steady
After coming down from unsustainable highs in mid 2022, the foodtech, online grocery, meal-kit and delivery marketplace ecosystem is holding steady. New data from PitchBook analyzes publicly listed companies across those industries, and sees revenues, profits, and valuations generally holding up with the broader market.
GROCERY | Delivery Catches Up with Pickup in Q2
GroceryDoppio just released its analysis of online grocery sales in the first half of 2023, and grocery and pickup are running neck and neck, in terms of how consumers get their online-ordered groceries. In Q2, delivery inched up to 49.1% of orders, rising from 48.5% in Q1.
The Big Picture: But, it’s not all rosy… overall sales declined quarterly, from $29.9 billion to $29.5. While the format is still cooling a bit from its pandemic highs, there’s a lot of work brands can do to rejuvenate the format. A whopping 71% of shoppers have still never tried a prepared meal from their grocer. We’ll see how these numbers compare to the next Brick Meets Click report, which is due in a few days.
A Few Good Links
Subway gives out one million free sandwiches, in lure to get shoppers to try new deli sliced meats. Buy Buy Baby auction cancelled, in latest blow to what’s left of Bed Bath & Beyond. Corrected link: Alto names DoorDash veep as new head of growth. New Ahold Delhaize CFO approved. Marco’s Pizza names new CMO. Festival Foods uses Upshot AI to track freshness. “Restaurant delivery is a uniquely crappy business.” Checkout.com launches video-based identify verification, customers include Uber Eats.
Got a tip, feedback, or just want to say hi? Reply back to this email.