Amazon managed to come out on top yet again during the 2018 Prime Day deals event.
Stock prices soared and Jeff Bezos became the wealthiest person in modern history despite glitches.
Amazon Stock Prices Skyrocket
As was the case for Prime Day Amazon 2017, this year’s event sent stock prices through the roof. Stock prices were already on the rise even before Prime Day Amazon 2018 officially started. Just before the sales went live, the company broke a new high record and things only rose from there.
Despite a somewhat rocky start with glitches plaguing the site on the most important sales day of the year, investors never lost faith in the company. They weren’t let down as the sales were the best the company had ever seen, yet again, in an annual Prime Day trend, and the effect on Amazon stock was accordingly record-breaking.
Jeff Bezos Wealth Tops $150 Billion
As a result of Amazon Prime Day’s successes, Jeff Bezos is now the richest person in modern history. The company’s founder watched his net worth spike beyond the $150 billion mark on Monday, according to the Bloomberg Billionaires Index. This sent his wealth to a figure about $55 billion higher than Bill Gates, the co-founder of Microsoft Corp. and the now second-richest person on the planet.
Fifty-four year-old Bezos also cracked through the $100 billion mark that had been exceeded only briefly by Gates back in 1999. Today, that same amount would be worth about $149 billion meaning that Bezos’s net worth would still exceed that of Gates at the dot-com boom’s peak. No one has been as wealthy as Bezos currently is since at least 1982, when Forbes first published a ranking of the world’s top wealth.
Interestingly, Bezos’s wealth hit that striking high even before Prime Day sales officially launched for their 36 hours of shopping madness. That said, his wealth didn’t remain above the $150 billion mark for long, having slipped slightly by the close of the sale. This was not, however, due to Amazon’s performance as much as the fact that tech investors were shaken when Netflix posted unexpectedly disappointing results.
The Prime Day Celebration
Amazon celebrated Prime Day over a span of 36 hours. The company has held the annual summer sale that has existed since 2015. This sale exclusively benefits its paying Prime members. In that way, it benefits the company through two main tracks. The first is that members come in droves to take advantage of the site’s discount prices. The second is that non-members will frequently register for membership in order to be able to participate.
Of course, Amazon also sold many of its own products, such as its tablets, Echo speakers and even Fire TV sticks. Prime members were able to purchase these products at deep discounts, meaning a profit for Amazon but also the opportunity to keep a larger number of people using its products and its software such as its personal assistant, Alexa.
When Prime first launched in 2005, the purpose was to give members free two-day shipping. Members could also enjoy one-day shipping at a discounted price. Membership was much less expensive at the time. Since then, the price has increased significantly, but members now enjoy many more benefits. This includes same-day delivery in some areas, unlimited video streaming, a free music library, photo storage and, of course, Prime Day discounts.
The first decade of Prime membership’s existence brought in 40 million members. However, since Prime Day was introduced three years ago, the company has increased its member numbers by an additional 55 million people.
Amazon does not publicly reveal its Prime Day sales data. However, estimates from analysts predict that sales were likely around $2.4 billion this year, which is about $1 billion higher than 2017’s figures.
All is Not Well at Amazon
At the same time that the company was celebrating record-breaking sales, workers in Europe were walking off their Amazon jobs. In Spain, nearly 1,800 workers went on strike even as Prime members placed their orders on the busiest day of the company’s year. In Germany and Poland, more workers joined in the protests.
The workers were those working in the company’s warehouses. The protests were over pay, but also working conditions and health benefits. According to service sector union, Verdi, the Amazon warehouse workers faced high levels of mental and physical stress as well as a number of other health issues. The union claimed that the miles of rows throughout the warehouses and the monotonous tasks were among the top reasons for the worker problems. Verdi claims that Amazon has declined to negotiate regarding these factors.
Lena Widmann, a Verdi spokesperson, released an email statement in which she said the e-tail giant “refuses to pay the usual commerce wages for Germany, [which also includes] holiday and extra bonuses as well as more days off.” She added that Amazon workers are seeking an improved working environment in which they can continue to work healthfully until they retire.
An Amazon spokesperson also released an email statement saying that “We are committed to ensuring a fair cooperation with all our employees, including positive working conditions and a caring and inclusive environment.” The statement added that “We encourage anyone to come see for themselves by taking a tour at one of our fulfillment centers.”
Spanish workers are continuing their three-day strike. In Poland, workers are staging a work-to-rule – a form of work slowdown in which workers complete their tasks, but never go above and beyond their requirements and always take all allowed breaks to their full length. Six facilities in Germany are striking.
The Costly Prime Day Website Glitch
Despite Amazon’s tremendous successes during Prime Day 2018, their figures may have been higher if not for a massive website error. The website experienced a crippling error for hours just as the sales launched. The wave of heavy online traffic caused reports of website issues and outages to start only minutes after the sale began.
At first, it appeared that the outage was limited to the United States. It looked as though only New York and California were being affected. However, it soon became clear that the problem was far greater than that. This was particularly true when reports started showing up from Amazon.ca, the Canadian version of the website.
The struggles seemed to vary depending on the individual user and the individual click. While some users were stuck in an endless loop on the homepage, others were able to access individual product pages without being able to search or brows. For hours, millions of Prime members were widely unable to shop. Even as they started to be able to add things to their cart, they could not sign in to their accounts to try to check out.
It is unclear as to how much money was lost from the site’s glitches during the first hours of Prime Day. Based on last year’s figures, every half hour was worth about $34 million. However, this year, Amazon is estimated to have made about $1 billion more than last year, so it could be that the figure is significantly higher.
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