Marketplace Briefing: An extended Prime Day has Amazon sellers rethinking discounts and inventory
This is the latest installment of the Marketplace Briefing, a weekly Modern Retail+ column about the ever-changing e-commerce marketplace landscape. More from the series →
Amazon’s Prime Day is getting longer — and more complicated. This summer, the e-commerce giant is extending its marquee shopping event to four days, up from the usual two, in what will be the longest Prime Day since it launched in 2015.
The change, first reported by Modern Retail, comes as Amazon looks to maintain dominance during a crowded sales season increasingly populated with rival “deal weeks” from Walmart, Target, Temu and more. For third-party sellers, who account for about 60% of all sales on Amazon, a four-day Prime Day is an opportunity to drive more sales, especially at a time when Trump’s far-reaching tariffs threaten to erode their margins.
“It was inevitable for Amazon to extend Prime Day,” said Tommy Burton, head of partnerships at Pacvue, a commerce acceleration platform.
But the extension also raises logistical, financial and strategic challenges. Sellers and agency heads that spoke to Modern Retail for this story said they’re navigating questions around inventory, pricing and promotional fatigue as they prepare for what’s shaping up to be a marathon shopping event.
“Brands know they have to participate because they know that this will be successful,” said Katya Constantine, founder of the ad agency Digishopgirl Media. “At the same time, a four-day promotional period is not ideal because you basically have to be on sale at a deeper discount than you would have wanted to be otherwise.”
Amazon did not respond to a request for comment by press time.
Four days, new rules
Last year’s Prime Day drove a record-breaking $14.2 billion in U.S. online sales, according to Adobe Analytics. Now, Amazon is giving sellers more time and promotional levers to boost performance. Brands will be able to offer Lightning Deals, Best Deals, Prime Member Coupons and Price Discounts, with varying minimum discounts. Deeper deals of 40% or more will receive expanded placement across Amazon’s site, increasing their visibility to shoppers.
The shift opens the door to more experimentation. Will Faire, co-founder and CEO of BellaVix, a marketing agency that works with marketplace-native and omnichannel brands, said the extra days could allow brands to test different combinations of deals and assess which promotions generate the most impact.
“We get to, A, buy more deals and, B, experiment with these deals over a longer period of time,” Faire said. “It’ll be interesting to see, during that four-day period, what the impact will be if we run a Lightning Deal, a Best Deal, or a Lightning Deal and a coupon.”
The most immediate operational concern for brands is inventory. With the sales window doubling, sellers are under pressure to get goods into Amazon fulfillment centers in time and in higher volumes, while still managing costs and avoiding excess inventory. Amazon has communicated deadlines to sellers, with inventory expected to arrive around mid-June and deals submitted by late May.
“A four-day forecast for a sale is more significant than two,” Constantine said. “Brands that have inventory on hand are better positioned than brands that need to place the orders right now to get the product from their overseas partners.”
Last year, Amazon introduced a new fee that charges sellers when their inventory runs low. Amazon sellers can also be charged an overage fee if they have too much inventory at fulfillment centers. Last year, Amazon told sellers the low-inventory fee would not apply for products that are included in Prime-exclusive deals during Prime Day 2024. The fee exception applied for the four weeks after Prime Day “when inventory levels may be more unpredictable based on Prime Day sales,” the company said at the time.
Jared Mason, VP of brand services at Pattern, an e-commerce accelerator, said the untested four-day format could make demand planning more difficult this year.
“They need to make sure they have enough inventory,” he said. “Going out of stock would be the absolute worst-case scenario. But the second worst case would be having so much inventory left over that you’re going to end up paying long-term storage fees.”
Deal fatigue
As Amazon introduces more tentpole events, including the October Prime Big Deal Days and the Big Spring Sale, brands are grappling with deal fatigue. Sellers say it’s becoming harder to justify steep discounts every few months, especially as costs rise on everything from platform fees to tariffs. In a survey of 325 sellers conducted by SmartScout, an e-commerce analytics company, 38% of sellers said they participate in Prime shopping events, but many report growing concerns about discount pressure. Meanwhile, over 50% of sellers reported being less profitable in 2024.
“We had to run discounts in January, then March, and now summer,” Mason said. “Of our 275 brand partners, maybe one or two participated in the spring sale in any significant way.”
Some brands are taking a hybrid approach to discounting, offering deeper discounts only on select days or scaling back the depth of their promotions to avoid margin pressure, Mason said.
“We still do have brands that are like, ‘I don’t need to discount at all,’” Mason said. “Just being available during Prime Day typically gets you a 20% boost in sales conversion.”
Jenny Leckie, head of data analytics and activation at PriceSpider, a commerce tech company, said that brands aren’t “giving up their whole portfolio” but instead selecting “hero products that make most sense for that audience and retailer.”
Some sellers are starting to draw firmer lines on which events they participate in. “The number one way brands are dealing with deal fatigue is just refusing to do it,” Mason said. “They’re still available, but they’re not discounting.”
Others are rethinking how much to invest across channels. Amazon’s dominance during Prime Day still makes it a priority, but it’s no longer the only player. As sellers branch out beyond Amazon, brands also face pressure to match discounts across other platforms including Walmart Marketplace, TikTok Shop and their own DTC sites.
Amazon sellers told CNBC last year that Amazon penalized them in the lead-up to Prime Day for selling items for less on Target during the big-box retailer’s competing sale event.
As Mason put it, “If I run a deal on Amazon, I have to run the same deal everywhere else.”
What I’m reading
- TikTok employees told Business Insider that the company’s Chinese leadership is tightening control over its American operations.
- Amazon has canceled orders for multiple products made in China and other Asian countries, according to Bloomberg.
- Amazon is expanding its discount store Haul to include name-brand goods that ship from U.S. warehouses, per The Information.