[ BDSN ] The Shelf is Dead : Prime Day 1 down 41%

🛍️ PRIME DAY TUES SALES DROP 41% - AI REWRITING RULES

Prime Day 2025 was supposed to break records. Instead, many sellers are staring at a shocking stat:

Sales appear to be down 41% year-over-year for Day 1, according to Momentum Commerce, one of the first real-time analytics providers to weigh in on the event.

And while Amazon disputes the accuracy of those numbers, sellers on the ground are seeing the same story: lower traffic, weaker conversions, and rising ad costs that aren’t delivering like they used to.

But here’s the twist: Adobe is projecting record-breaking online sales across e-commerce: $23.8 billion over the four-day period. So what gives?

It’s not that people aren’t shopping.

It’s in part that they’re not shopping the way they used to.

🤖 GenAI Is the Silent Disruptor of Prime Day 2025

According to Adobe, this year’s Prime Day marks a massive shift in consumer behavior powered by generative AI.

📈 AI-driven shopping traffic is up 3,200% year-over-year.

That’s not a typo. Consumers are increasingly using GenAI tools like Rufus, ChatGPT, Perplexity, Gemini, and even AI-integrated browsers to:

• Conduct product research (55%)

• Get recommendations (47%)

• Find deals (43%)

• Discover unique products (35%)

• Make gift lists (33%)

Adobe’s survey of 5,000 U.S. consumers found that 92% said AI improved their shopping experience, and 87% said they’re more likely to use AI for larger or complex purchases.

The implication?

If you’re not showing up in AI-generated results or training these systems to recommend your products …

You’re invisible.

📉 Why Prime Day “Feels” Slower for Sellers

So how can Adobe report a booming $23.8B sales forecast, while many sellers are experiencing a slump?

Here’s the breakdown:

• 🔎 Discovery Has Moved Upstream: GenAI tools are helping buyers skip the marketplace entirely by directing them to curated results, meaning many brands are being filtered out before the shopper ever lands on Amazon.

• 💸 Retail Media Saturation: Ad costs are up. And 85% of sales last year came from Sponsored Products. But this year, even ad-heavy listings are getting less traction as buyers look to trusted AI assistants instead of ads.

• 📱 Mobile Rules the Day: Adobe reports 52.5% of sales are coming from mobile, but conversion is lower on mobile, especially for products without strong visuals or reviews that work well in short attention spans and GenAI summaries.

🧠 What Smart Brands Are Doing Right Now

This Prime Day isn’t a failure. It’s a foreshadowing of a shift from PPC-and-pray to AI-and-influence.

Here’s how to adapt fast:

✅ 1. Optimize for AI Discovery

If your PDP and brand site aren’t structured for GenAI tools to parse, summarize, and recommend, you’re missing the new traffic layer. Use structured data, question-based copy, and review mining to seed GenAI with high-quality info.

✅ 2. Focus on Off-Amazon Touchpoints

Email and paid search still dominate, but AI-assisted discovery is exploding. Get your products mentioned in blogs, UGC, Reddit, Quora, and forums, places GenAI pulls from.

✅ 3. Rethink Your Influencer Strategy

Creators who use GenAI are your new affiliates. Train them to feed your brand into the new machine-driven funnels by embedding your SKUs into AI-prompted content.

✅ 4. Capture AI-Lost Traffic with Remarketing

If someone found a competing product via AI, they may still browse. Use Amazon DSP, Google Performance Max, and TikTok retargeting to bring them back.

✅ 5. Prepare for Q4’s New Battleground

Prime Day was the test. Q4 is the war. Build out preemptive campaigns targeting AI, TikTok, and email.

Prime Day 2025 may go down as the first truly AI-influenced retail event.

Some sellers will blame it on weak deals, poor traffic, or high CPCs. But the real reason sales may have dropped is that consumers aren’t searching, they’re asking.

And if your brand isn’t the answer?

You’re not just losing Prime Day.

You’re losing the future.

🔭 YOU GOTTA SEE THIS

The major GPT upgrades expected on the horizon:

• Magic “Unified” Interface
  Sam Altman’s goal is to remove friction: no more model-picker, just one seamless “magic” AI that adapts to whatever you need.

• True Multimodality
  Text, images and audio in one unified workflow—building on GPT-4o’s real-time voice and 50+ language support, you’ll be able to mix media types naturally in a single conversation.

• Massive Context Windows
  Rumored support for over 1 million tokens of context. That means you could feed entire books, huge data logs—or a long corporate report—into one prompt and have it understood end-to-end.

• Stronger Multi-Step Reasoning
  Early benchmarks suggest up to 20% gains over GPT-4 on complex, chain-of-thought problems, making it better at unfolding multi-stage tasks and “connecting the dots.”

• Built-In Agentic Abilities
  Rather than simply answering questions, the model can plan, delegate subtasks, and carry out multi-step processes on its own—think of it as a personal AI assistant that doesn’t need hand-holding at every step.

🛒  THE SHELF is DEAD: DEMAND is the NEW BATTLEFIELD

BDSS Dream 100 member Destaney Wish says if your answer to “How do people find your products?” is “on Amazon” or “in stores,” you’re already falling behind.

Why?

Because product discovery has changed. Shoppers now:

• See products before they even know they need them (social feeds, podcasts, TikTok, TV).

• Ask AI what to buy, not search Amazon.

• Trust personalized recommendations and contextual discovery over page-one SEO.

🔄 The Path to Purchase is No Longer Linear

The traditional funnel is fading. Your product is now competing:

• Not just with what’s on shelf or Amazon's page one…

• But with AI-generated product suggestions, UGC, and creator-driven content.

If you’re only optimizing your PDP and running Sponsored Products, you’re showing up too late.

🔑 Action Steps: How to Win in the New Era of Discovery

1. Create Demand Before They Search

• Use social media, content creators, podcasts, and even TV ads to generate awareness before the search happens.

• Your goal: when customers ask AI what to buy, they already know your brand name.

2. Think Like a Brand, Not Just a Seller

• Brands build context. Sellers chase clicks.

• Invest in brand stories, video, creator UGC, and top-of-funnel education.

3. Dominate the First Touchpoint

• Run creative that educates and entertains, not just converts.

• When the customer eventually does search or ask AI, they already have bias in your favor.

4. Lean into Imperfect Attribution

• Don’t let the lack of clean attribution stop you. That TV ad, TikTok, or Instagram story might be the spark that drives an Amazon sale two days later.

• Track indicators (like branded search volume) instead of obsessing over last-click ROAS.

5. Prepare for AI-Driven Discovery

• AI is curating shopping recommendations.

• If your product doesn't perfectly match the user's needs or lacks a brand connection. AI won’t show you.

The digital shelf is overcrowded. Retail media is pay-to-play. And AI is rewriting the rules.
Start showing up before customers realize they’re shopping.

✈️  DE MINIMUS EXEMPTION to END FOR ALL COUNTRIES

The U.S. de minimis exemption, which allows imports under $800 to enter duty-free, will officially end on July 1, 2027, following a new law signed July 4 by President Trump as part of the “One Big Beautiful Bill Act.”

• The repeal targets commercial use, not gifts or travel purchases.

• A $5,000–$10,000 penalty will apply for misuse starting 30 days after the bill’s enactment.

• The move expands on Trump’s earlier restrictions, including a 2025 ban on de minimis imports from China and Hong Kong.

• In 2024, 76% of de minimis shipments came from China.

• E-commerce giants like Shein and Temu, who relied heavily on this loophole, may be forced to shift toward bulk shipping or U.S.-based fulfillment to adapt.

This marks a major shift in U.S. import policy, particularly affecting cross-border e-commerce and low-cost international shipments.

🇺🇸  TIKTOK’S M2 PLAY: NEW APP COMING FOR USA

TikTok isn’t just updating its app—it’s rewriting its future in the U.S.

According to The Information, TikTok is secretly working on a new, U.S.-only version of the app, internally dubbed “M2”, scheduled to launch in app stores on September 5th, 2025. The current app (“M”) will still work for now—but only until March 2026.

🔥 The Political Backdrop

Under pressure from the Protecting Americans from Foreign Adversary Controlled Applications Act, ByteDance (TikTok’s parent company) is being forced to either divest or face a U.S. ban. Trump has extended the deadline several times, but that grace period ends September 17.

To comply without giving up control of its prized algorithm, TikTok is creating a split version of the app just for U.S. users. The M2 launch aligns exactly with the end of the extension period, suggesting a major pivot is imminent.

🧠 What We Know About “M2”

• It’s a separate app, not just an update. Users will need to re-download to continue using TikTok.

• Launch date: September 5th.

• The current app (M) will be delisted from U.S. app stores by September 17, and phased out by March 2026.

• Algorithm details remain murky: ByteDance may withhold the full algorithm or offer a stripped-down, licensed version to U.S. operators.

⚠️ How this Affects Ecom Sellers

1. Ad Platform Shakeup: Ad accounts, pixel data, and campaign structures may not transfer seamlessly to M2. Sellers should prepare for re-verification and potential changes to targeting or performance.

2. Creator Collabs in Flux: If you're working with U.S.-based TikTok creators, expect delays or disruptions. Influencers may have to rebuild their audiences or engagement strategies in M2.

3. Algorithm ≠ Algorithm? If M2 uses a modified algo, expect early volatility in engagement, reach, and conversion rates. What works today might flop tomorrow.

4. Double the App, Double the Work? Brands may have to manage content and strategy across two TikToks (global “M” vs. U.S. “M2”), each with different rules and behaviors.

📅 Key Dates

• Sept. 5: New “M2” app drops in U.S. app stores

• Sept. 17: Existing TikTok app delisted in the U.S.

• March 2026: Legacy app fully disabled in U.S.

✌🏼 Have a great weekend.

See you again on Monday.

The answer to today’s STUMP BEZOS is
U.S. social commerce will hit $114.70 billion in 2025.