Amazon kicked off its annual summer sale on Tuesday (July 8), but as Bloomberg News reported, the trade war has caused some consumers — and some brands — to stay away.
The report notes that the 10-year-old event, which stretches over four days this year, could offer a glimpse into consumer spending and buying habits at a time of mixed signals on the health of the American economy.
“Prime Day will provide an early indication on consumer appetite, especially in categories like apparel, electronics and TVs, where price drops are expected to be the deepest,” said Vivek Pandya, lead analyst at Adobe.
That company has forecast that Amazon and other American retailers will realize $23.8 billion in online sales from Prime Day.
As the report notes, consumption dipped somewhat in May, while consumer sentiment rose in June. Prime Day could help provide a better glimpse of consumer spending for the remainder of the summer.
“Prime Day will be quite a test,” Romain Fouache, CEO of Akeneo, seller of software used by eCommerce businesses, told Bloomberg.
A survey by that company showed that of the 1,000 U.S. shoppers polled, 25% planned to skip Prime Day because of tariffs, while 57% said they would pay closer attention to prices.
But this hesitancy doesn’t just stop with consumers, the Bloomberg report added. Some online sellers, who account for 60% of the products sold on Amazon’s site, say they can’t afford to offer discounts this year because they need to boost prices to alleviate the costs from tariffs.
Consumer optimism about the impact of the tariffs varies greatly depending on what they value in their purchases, according to the report PYMNTS Intelligence “Consumer Tariff Sentiment: Informed Americans Are Skeptical of the Benefits.”
When offered the choice between low-priced or American-made products, 39% of shoppers always or mostly value affordability, a feature associated with goods imported from low-cost China. On the flip side, 34% of consumers said they always or mostly prefer items made in the U.S., and 26% placed equal weight on both.
PYMNTS Intelligence research has also found that more than 8 in 10 consumers are taking measures to offset the financial impact of tariffs on their bank accounts.
“In fact, the average individual is making nearly five such behavioral changes, and 44% of consumers have already changed their shopping habits in response to tariff-induced price pressures,” PYMNTS wrote last month.
