DTC Briefing: How startups learned to embrace Prime Day

“I think we found that it wasn’t actually converting more people on the site, and we were just giving away dollars because folks were waiting for a bigger deal on Prime Day,” Nathan said. 

Prime Day, the annual two-day sale hosted by Amazon for its Prime members, has typically set the tone for July retail sales since its inception in 2015. In recent years, competitors including Walmart, Target and, most recently, TikTok also started offering their own sales in mid-July. But for years, DTC brands sat out of Prime Day. Some, like Away, refused to sell on Amazon in the first place. Others refused to offer discounts — both on Amazon and on their own websites — because of their aversion to sales in general. 

But now, DTC brands ranging from Caraway to Brooklinen to Casper routinely participate in Prime Day. It’s just one of many ways that DTC brands are simply morphing into regular old brands. The consistent theme in particular that I’ve heard from DTC executives this year is that as inflation remains at the top of customers’ minds, people are waiting to buy until big sales periods hit. Participating more wholeheartedly in Prime Day is just one example of how DTC brands are adjusting to that.

“Consumers are really primed for shopping at this moment in the year,” Suze Dowling, co-founder and chief business officer at Pattern Brands said. “I think for us, it’s like how do you capitalize on that increased consumer activity?”

Nathan said that all of Caraway’s emails, text messages and Meta advertisements will be focused on directing its customers toward Amazon on Prime Day this year. Caraway will also start promoting its Prime Day discounts about a week in advance of the big two-day sales period, urging customers to “prepare their carts.” 

Caraway will be offering discounts at its other retail partners too — its products are sold at Target, West Elm and The Container Store, among other retailers. “In general, retail partners like to be in parity with the lowest price out there,” Nathan said. 

Many executives said they don’t expect competing Prime Day sales to be as big as Amazon’s two-day extravaganza. But, they also figure it doesn’t hurt to participate in the competing sales that are being hosted by Walmart, Target, TikTok and others as it exposes them to new customers.

This year, for example, TikTok is hosting its first-ever Prime Day competitor, called Deals for You Days. As my colleague Allison Smith reported, TikTok is subsidizing some of the discounts for this event. 

“This event is about product discovery and getting more products into the hands of people,” Ronak Shah, the co-founder and CEO of a collagen brand called Obvi, told Modern Retail. Obvi is participating in TikTok’s sales event in addition to Prime Day. “If I make a couple bucks, great. As long as I don’t lose money, I’m happy.” Still, Shah said he expected only about 20% of his revenue from July sales events to come from TikTok and the rest from Amazon. 

Even though Caraway isn’t offering its pre-Prime Day sale this year, it still will be offering some discounts on its site during the two-day sales period this year. On its site, Caraway will offer 20% off select bundles. Meanwhile, its Prime Day sale will be 20% off its entire Amazon assortment. 

This DTC sale is a way for Caraway to test out how receptive customers are to various bundles while also clearing some inventory. Nathan, however, doesn’t expect them to be huge sales drivers. 

“We think conversions will be higher on Amazon, and so we want the best deals to be on the platform,” he said.

How DTC startups approach Prime Day also depends on what their goals are beyond generating sales. 

Dowling of Pattern Brands — which owns a variety of home goods lines like towel brand Onsen and kitchen gear brand Gir — declined to share the exact discounts her company was offering ahead of Prime Day. Generally speaking, she said, Pattern Brands views Prime Day as a way to acquire new customers. 

In addition to a sitewide sale, across its various brands Pattern Brands will offer on Amazon some deeper discounts on a hero SKU or a gift with purchase, depending on what it thinks will be the biggest incentive for a first-time buyer of a particular brand. Pattern Brands will also offer some lightning deals as a way to entice people to buy by creating a sense of scarcity and demand. 

Ultimately, the conundrum brands face this Prime Day is the same challenge they’ve faced all year: how to get customers to buy right now instead of in the future or just not buying at all? 

Dowling said that, overall, she feels like customers are “value-conscious” right now. 

“They really want to make sure that they’re getting products that are functional, that are going to be durable and long-lasting,” she said. 

What I’m reading 

• The Business of Home has a deep dive into the financial struggles of home furnishings brand Burke Decor. The brand’s founder, Erin Burke, has filed for bankruptcy, while the company is also being sued for $6.4 million by one of its lenders.
• Peloton has thwarted a cash crunch, for now, after the at-home fitness company refinanced hundreds of millions in loan payments that were supposed to be due in November 2025. But, that still doesn’t address underlying issues with Peloton’s strategy, CNBC reports. 
• Business of Fashion has a case study on how brands can balance DTC and wholesale. 

What we’ve covered 

• Why Fashionphile is turning two of its pop-ups into permanent brick-and-mortar stores.  
• How kids brands like Coterie and PatPat are targeting millennial and Gen Z parents. 
• Australian fashion brands like Princess Polly, Camilla and Bared Footwear are opening more stores and distribution centers in the U.S.