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Amazon's Prime Day runs into early snags

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Amazon's Prime Day runs into early snags
News

News

Amazon's Prime Day runs into early snags

2018-07-17 13:35 Last Updated At:13:35

Amazon's website ran into some early snags Monday on its much-hyped Prime Day, an embarrassment for the tech company on the shopping holiday it created.

Shoppers clicking on many Prime Day links after the 3 p.m. ET launch in the U.S. got only images of dogs — some quite abashed-looking — with the words, "Uh-oh. Something went wrong on our end." People took to social media to complain that they couldn't order items.

By about 4:30 p.m., many Prime Day links were working, and Amazon said later Monday that it was working to resolve the glitches.

FILE- In this Aug. 3, 2017, file photo, packages ride on a conveyor system at an Amazon fulfillment center in Baltimore. Amazon's Prime Day starts July 16, 2018, and will be six hours longer than last year's and will launch new products. (AP Photo/Patrick Semansky, File)

FILE- In this Aug. 3, 2017, file photo, packages ride on a conveyor system at an Amazon fulfillment center in Baltimore. Amazon's Prime Day starts July 16, 2018, and will be six hours longer than last year's and will launch new products. (AP Photo/Patrick Semansky, File)

In an email to The Associated Press, it said "many are shopping successfully" and that in the first hour of Prime Day in the U.S., customers ordered more items than in the same time frame last year.

Still, the hiccups could mute sales and send shoppers elsewhere during one of Amazon's busiest sales periods that's also a key time for it to sign up new Prime members. Shoppers have lots of options, as many other chains have offered sales and promotions to try to capitalize on the Prime Day spending.

Analyst Sucharita Mulpuru-Kodali at Forrester Research called the glitch a "huge deal."

"This is supposed to be one of their biggest days of the year," she wrote in an email. "I am shocked this caught them off guard. But I guess the lesson is to not have a big unveil during the middle of the day when everyone comes to your site all at once."

Amazon, which recently announced that Prime membership would be getting more expensive, was hoping to lure in shoppers by focusing on new products and having Whole Foods be part of the process. It was also hoping parents would use the deals event to jump start back-to-school shopping.

FILE- In this Aug. 3, 2017, file photo, Myrtice Harris applies tape to a package before shipment at an Amazon fulfillment center in Baltimore. Amazon's Prime Day starts July 16, 2018, and will be six hours longer than last year's and will launch new products. (AP Photo/Patrick Semansky, File)

FILE- In this Aug. 3, 2017, file photo, Myrtice Harris applies tape to a package before shipment at an Amazon fulfillment center in Baltimore. Amazon's Prime Day starts July 16, 2018, and will be six hours longer than last year's and will launch new products. (AP Photo/Patrick Semansky, File)

Jason Goldberg, senior vice president of commerce at Publicis. Sapient, noted that the problems could turn off shoppers for a while, particularly those who planned to sign up for Prime membership.

"If you were planning to find Prime deals to lower the cost of back-to-school (purchases), you're almost certainly going back to your traditional venue of choice," he said.

Goldberg noted that it's easy for Amazon to extend deals on its own devices and brands, but trickier for it to extend deals for its third-party sellers because they signed up for different promotional slots.

While Amazon doesn't disclose sales figures for Prime Day, Deborah Weinswig, CEO of Coresight Research, had estimated that it will generate $3.4 billion in sales worldwide, up from an estimated $2.4 billion last year. Prime Day also lasts six hours longer than last year.

FILE- In this Aug. 3, 2017, file photo, packages pass through a scanner at an Amazon fulfillment center in Baltimore. Amazon's Prime Day starts July 16, 2018, and will be six hours longer than last year's and will launch new products. (Photo/Patrick Semansky, File)

FILE- In this Aug. 3, 2017, file photo, packages pass through a scanner at an Amazon fulfillment center in Baltimore. Amazon's Prime Day starts July 16, 2018, and will be six hours longer than last year's and will launch new products. (Photo/Patrick Semansky, File)

Meanwhile, other retailers like Macy's, Nordstrom, Best Buy, Walmart and Target have rolled out their own promotions, said Charlie O'Shea, lead retail analyst at Moody's.

"Brick-and-mortar retailers know that they have little choice but to continue offering their own deep discounts, which is evident in the proliferation of 'Black Friday in July' deals that are being launched earlier each year, as well as various 'price match' offers," he said in a note earlier Monday.

Amazon created Prime Day in 2015 to mark its 20th anniversary, and its success has inspired other e-commerce companies to invent shopping holidays. Online furniture seller Wayfair introduced Way Day in April, becoming its biggest revenue day ever.

Prime Day also usually helps boost the number of Prime memberships. Amazon disclosed for the first time this year that it had more than 100 million paid Prime members worldwide. It's hoping to keep Prime attractive for current and would-be subscribers after raising the U.S. annual membership fee by 20 percent to $119 and to $12.99 for the month-to-month option.

"It has been one of the best vehicles" for signing up members," said Goldberg.

Amazon is adding artificial intelligence visionary Andrew Ng to its board of directors, a move that comes amid intense AI competition among startups and big technology companies.

The Seattle company said Thursday that Ng, a managing director at the Palo Alto, California-based AI Fund, will replace a seat vacated by Judy McGrath, a former CEO of MTV who told Amazon she won't run for reelection.

Ng's AI Fund, which he founded in 2017, invests in entrepreneurs building artificial intelligence companies. Previously, he led AI teams at the Chinese tech company Baidu and Google, where the team he oversaw taught a computer system to recognize cats in YouTube videos without ever being taught what a cat was.

Ng's addition to the board comes as Amazon, like other tech companies, makes massive investments in generative artificial intelligence. The company has invested $4 billion in the San Francisco-based startup Anthropic, which is partnering with Amazon to develop so-called foundation models that underpin generative AI technologies. In the past year, Amazon also rolled out a chatbot for businesses called Q and a generative-AI powered shopping assistant named Rufus.

In an annual shareholder letter released Thursday, Amazon CEO Andy Jassy suggested generative AI could be the next big pillar of Amazon's business, joining the company's prominent online marketplace, Prime subscription program and its cloud computing unit, AWS. Jassy wrote that generative AI may be the largest technological transformation since cloud computing, and “perhaps since the internet.”

Meanwhile, other Amazon innovations have encountered some hiccups. The company said last week it was pulling its Just Walk Out technology from Amazon Fresh stores in the U.S. after receiving some customer feedback. Amazon said it was replacing the technology, which allows customers to skip the checkout line, with smart carts that would allow them still to do that but also see their spending in real time.

FILE - In this Friday, July 14, 2017, file photo, computer scientist Andrew Ng poses at his office in Palo Alto, Calif. Amazon announced Thursday, April 11, 2024, that it added artificial intelligence visionary Andrew Ng to its board of directors amid intense AI competition among startups and big technology companies. (AP Photo/Eric Risberg, File)

FILE - In this Friday, July 14, 2017, file photo, computer scientist Andrew Ng poses at his office in Palo Alto, Calif. Amazon announced Thursday, April 11, 2024, that it added artificial intelligence visionary Andrew Ng to its board of directors amid intense AI competition among startups and big technology companies. (AP Photo/Eric Risberg, File)

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