How Amazon Is Leveraging Taylor Swift’s Star Power For Prime Day

Amazon.com Inc. (AMZN), the world’s leading e-commerce platform, has achieved spectacular success in growing its Amazon Prime subscription to more than 100 million members, boosting customer loyalty by offering special services for a fee. That has helped Amazon’s market value rise to around $950 billion. Now, the company’s strategy is to sharply expand the reach of its service during its Prime Day in mid-July by teaming up with global pop star Taylor Swift.

Swift brings even a giant like Amazon unique customer reach. An artist with millions of streaming fans globally, Swift is the first artist to debut an album with more than 1 million units on four separate occasions, according to Forbes. She will perform with other stars at the Prime Day Concert, which is scheduled five days before Amazon kicks off its Prime Day on July 15. This year, Amazon expanding its shopping event from one day to two. 

The show will stream to more than 200 countries on July 10th at 9PM EDT and will be available only to Prime members via Prime Video. The company says that the “first-of-its kind event” will also be available for next-day, on demand viewing. 

Swift, the country star turned global pop sensation, will perform alongside other popular artists like Dua Lipa, SZA and Becky G. Actress Jane Lynch will host the event. In the past, popular stars like Ariana Grande have headlined similar events for Amazon — but Swift is no doubt the biggest-name artist yet. 

The live concert aims to entice more people to sign up for Prime, offering members with yet another perk alongside free two-day delivery, video streaming, and other deals, discounts and exclusive access. According to Statista, Amazon Prime had an estimated 103 million subscribers in May 2019, up from 95 million in June 2018. 

On average, Amazon Prime members spent $1,400 on Amazon annually, compared to just $600 for non-Prime members, per Business Insider. Many of those buyers are Millennials and other younger consumers. Meanwhile, consumer loyalty for Amazon is at an all-time high for Prime members, with data from MarTech indicating that 96% of current paying members are more likely to buy products from Amazon than other e-commerce sites. 

Prime Day is one of Amazon’s biggest sales periods along with Cyber Monday and Black Friday. The sheer volume of business means that luring more consumers to sign up for Prime’s $119 annual subscription could create its own problems. In the past, the spike in traffic to Amazon on Prime Day has led to issues, including last year, when the landing page broke and checkout temporarily shut down. 

While Amazon does not release sales figures for Prime Day, Wedbush Securities analyst Michael Pachter estimates it at $4.2 billion for 2018’s 36 hour event, per Bloomberg.

Taylor Swift’s appearance also will help the e-commerce company to market Amazon Music, which is competing against much larger rivals such as Spotify Technology SA (SPOT) and Apple Inc.’s (AAPL) Apple Music. While Prime members already have access to 2 million songs through their subscription, upgrading to Amazon Music will grant them access to another 50 million songs. Amazon is promoting this ad-free service for $0.99 for the first four months. 

Amazon is also likely to advertise its new original TV series during the concert as it steps up its growth in streaming entertainment against other tech giants like Netflix Inc. (NFLX), Apple, and traditional players like Walt Disney Co. (DIS).

This means that Amazon has a unique opportunity on Prime day. Through a single concert, Taylor Swift offers Amazon a marketing opportunity with a potentially giant return in terms of attracting new customers. And Swift, also known to be a shrewd entrepreneur, will expand her audience as well.