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$AMZN - Why Amazon Is Going to Dominate the Next Decade

$AMZN - Why Amazon Is Going to Dominate the Next Decade
EDIT: TLDR - Buy AMZN get Tendies - See comments for Trash Talk - Thanks for the Silver!
EDIT 2: Thank you u/Dmillehe spending his money on Platinum instead of AMZN stock. You're the real autist.
Amazon is going to dominate the next decade. It's a wonderful business trading at a discount to it's true ability to create cash earnings. My thesis is that traditional methods of valuation that work for most companies don't work for Amazon. This misunderstanding between market 'conservatives' or 'traditionalists' .. so called value oriented investors (of which I consider myself a part) is currently reflected in the share price today, and it's a mistake. Second, the firm has reached a point of inflection, where scale will now provide growth of earnings far in excess of growth in sales. This multiyear catalyst provides a fundamental basis for significant share price appreciation.
To understand why Amazon presents such a compelling investment opportunity, one must understand what is currently transpiring in two specific and unique business segments. E-commerce and Cloud Computing. Many of you are probably familiar with at least the former. The latter is foreign territory to most.
E-Commerce: Why Amazon is prepared to conquer the next decade in retail.
Traditional retail or brick and mortar (B&M from here on out) is still the dominant form of consumer spending in the U.S. and will be for some time. As of Q3 2019, total retail spend amounts to $5.4 Trillion dollar for the prior 12 months. E-commerce amounts to merely 11.2% of this amount (on a run rate basis.) While the size remains relatively small, e-commerce is growing in the mid-teens year over year, or now 5% quarter to quarter and the rate of growth is accelerating. The rate of E-commerce growth has doubled in 12 months.
To understand why this is the case, a qualitative evaluation of the differences between the two is critical. B&M requires physical space that is expensive to build and maintain. It requires uniformed, reliable, friendly and knowledgeable staff. It requires the deliberate presentation of inventory and restocking, amounting to a unique challenge to the retailer of determining layout of shelf space, product mix and promotion.
It's costly for the consumer too. They have to drive there, walk in, and find what they are looking for. This requires owning a car or putting up with public transportation. This can take a significant amount of time. There are some hidden costs too, without E-commerce, price discovery is a pain in the ass. Something retailers are keenly aware of. Here's something interesting about humans and economics. In economics, for a long time, we've modeled humans like they're these perfect rational beings. Ideally.. they'll drive down the road to a different store to get 3% off of whatever they're buying. Ideally. And you will do that for a car. But in reality, if it's 3% off a bag of chips, it's not worth the hassle. It's too expensive to go get $.14 of savings when you have to drive another 10 minutes to another grocery, walk in to figure it out if you're actually saving the most money.. consumers don't do that.
Consumers don't engage in price discovery on most of their small dollar purchases, they don't do that with traditional retail, because it's too costly in time and effort. There's too much friction in the trade-off.
The value proposition of E-commerce is that it saves consumers time and money. Getting in the car, loading the kids in the back, driving, parking, and then hunting for what you want, making sure you are getting a fair price, E-commerce throws all of that out the window. The value proposition for retailers too, is that it saves them time and money. There are plenty of retailers currently taking an omni-channel approach to retail, those who want to shop in person get to, those who shop online can do that too.. everybody wins. E-commerce takes the friction out of price discovery on small dollar purchases.
Given the advent of mobile computing more than a decade ago, many big box retailers also adopted a price match strategy, if you can find it online for the same price? Best Buy, Micro Center etc. they'll match it to keep you as a customer. But that's the extent of it, try going to Kroger and arguing with the cashier about Albersons having a 3/$5 deal on Frito Lay Potato Chips.. that ain't happening.
Amazon isn't Ecommerce, they are a part of it. Their strategy is different than the whole. They are technically omni-channel. However the little B&M they've done mostly as R&D experiment, more on Whole Foods in a minute. The Amazon E-Commerce thesis is this: At the end of the day, most consumer purchases are commodity purchases. They are small dollar items that are easily replicated. This segment of retail has yet to be disrupted by E-Commerce until now. It overlaps with specialty retail and big box items almost seamlessly from a logistical standpoint. The revenue streams are more stable than specialty retail, and it presents a massive opportunity in the long run.
I had the chance to speak with a finance manager at Frito-Lay (subsidiary of PepsiCo) years back after Amazon bought Whole Foods. Amazon had been attempting for years to get the same products you see in any Kroger or Albertsons onto their platform. For a variety of reasons, PepsiCo would not play ball with Amazon. It amounted to channel conflicts between the big established players vs. the disruptive incumbent. What Pepsico had done to Amazon, had been done by Proctor and Gamble, Nestle, Kellogg, and many more.
The purchase of Whole Foods was a big F U, a "we'll do it live" moment.. a Leeroy Jenkins. So you won't let us into your club? Fine, we'll do it ourselves. Grocer's panicked and for good reason. They were the reason Amazon had been held at bay for so long. They'd used their absolute size for many years to prevent E-commerce retailers from getting the same product mix at the same price online. Amazon responded by entering their territory, in buying a physical grocery chain. Grocer's fear was real and warranted, however the truly brilliant component of this purchase was that Amazon purchased for themselves a supply chain for grocery and private label products (365 brand.) Fast forward a couple years and Amazon now has over four hundred private label brands, more than twenty three thousand individual SKUs and 1.4 Million reviews of these products/brands. That entire article is worth a thorough read. Each product line represents a moonshot where amazon can collect both sides of margin on a private label product that disrupts traditional brands. Often it goes well, sometimes it does not, but the platform allows them to poke holes in each product category, and cannibalize the producer surplus of other more expensive branded product in the process. They don't have to advertise, market or promote any of this either.. yet it's already getting plenty of attention.
Here is a compelling example of how Amazon can undercut a premium brand with it's store brand knock off. And there's nothing Allbirds can do about it.
Amazon has built out an infrastructure of warehouses (which are relatively cheaper to maintain on a $/sf basis than traditional B&M retail space) and delivery drivers to meet the daily needs of consumers accustomed to B&M retail. They've disinter-mediated the entire process. You do not need a car, you don't have to be nice to the person behind the counter, or go hunting for that specific product you need on aisle 9, or check to see if the price is competitive or on deal. You can just type it in to your phone in 5 seconds, and see quickly who has the best deal. Turns out (and this is from experience) 9/10 times Amazon has the best deal and they'll ship it that day or the next.
For the consumer, it amounts to savings in both time and money. What the data shows is that we are experiencing rapid change in slow motion. E-commerce is growing explosively here in the U.S. however it's still of relatively small scale, that it will take some time before eclipsing B&M retail. Second, the data shows this rate of growth is accelerating, and has doubled in the last year or so. Traditional retail is not going to disappear entirely either. There are plenty of Amazon proof businesses for now. Hair salons, vets, dentists, nail salons, along with restaurants and apparel to a certain extent.
This online E-commerce platform has allowed Amazon to build out a peripheral advertising business in search. The search component allows Amazon to promote it's own store brand product alongside the branded counterparts. Second, it's able to sell web page space to branded products. Google currently dominates the search game, but Amazon is in 2nd place and stealing market share.
Finally, Amazon has rolled out a wonderful product called Subscribe and Save. Within this platform, Amazon is able to offer 15%-20% savings on everyday commodity items in exchange for a commitment to purchase at a monthly frequency (and it can be cancelled at any time.) What Amazon has discovered is that subscription purchases are relatively sticky. In exchange for a soft commitment from consumers that is relatively stable and predictable, Amazon can actually lower the cost of goods to the consumer. In turn, they are also able to optimize logistically for these sales as they can plan far in advance for them. Second, this allows them to relay demand information to other merchants as well. Example: Amazon can remit data to Tide, and let them know how many pods they expect to need in the coming months based on subscription commitments. Both Tide and Amazon are able to lower CoGS because they have more time to plan for those costs.
Furthermore, if you have an Amazon Credit Card through Chase bank, you get an additional 3%-5% all purchase at Amazon & Whole Foods.
The combination of all of these benefits as a platform amounts is an incredibly compelling value proposition to consumers. As of June this year Amazon has accumulated 105 Million Prime Memberships in the United States, and it is the largest paid subscriber base of any company in the United States period.
One of the luxuries I enjoy in my occupation is that my employer has a very long investment time horizon & high risk tolerance. What this allows is for us to kick back, put our feet on the table and think about what the world will look like in 10 years and how we'd consider being a part of it.
So here's a thought experiment, what do you think the retail experience for consumers looks like in a decade? Here's my prediction. Consumer's buy the vast majority of the things they need online, and they receive it within a few hours to a day, and they're spending less than ever before on what they need. This is already happening, and It's grabbed the attention of people like Jim Cramer, as well as Fed Chairman Jerome Powell. Albeit, E-Commerce is relatively small for now, but the rapid transformation is already causing ripple effects across retail. In 10 years, my thesis is that E-commerce becomes the largest component of total retail sales and Amazon remains the largest component of that segment, as it is today. Additionally, they probably steal share and grow at a faster pace than E-commerce as a whole, as they have done over the last several years.
Personal anecdote:
I'm sitting here in my home office wearing Amazon branded Jeans. I've got 10+ Amazon branded undershirts upstairs, along with 5+ pairs of Amazon Synthetic Golf Shorts. In my house, we've got Amazon branded batteries, note cards & printer paper, detergent pods, echo devices, cameras and more all over the place. There's more too, but I'm not going to list it all. In my experience, what they make is just as good if not better than the branded counterpart, and they do it for less, often a lot less. And I got tired of hyperlinking, so if you're curious, go to amazon.com and start looking around for these products.
Even more, as of now my wife and I spend +$250/mo on subscribe and save items we need for our household, this includes baby formula, diapers and wipes, detergent, shampoo and soap, trash bags, dog food, paper towels and more. We use the 5% back credit card and blended save close to 20% on these daily items we need.
In conclusion, on E-Commerce, I expect Amazon to dominate the next decade in retail. They have a massive competitive advantage over other retailers engaged in an omni-channel strategy, therefore it's their game to lose. Furthermore, their competitive edge today will compound into the future and amount to further share gains and a wider moat in years to come.
Cloud Computing: What is this industry, how does Amazon fit in the picture, and why is it such a big deal?
Again, to understand Amazon you'll have to understand what Cloud Computing is. This is not an everyday consumer product/service, therefore it's foreign to most individuals. Second, because the transactions and services are business to business (B2B) it's relatively difficult to determine detailed industry characteristics. What may come as a surprise to you, is it's the most profitable business segment (on a NOPAT basis) and it's also their fastest growing segment.
Cloud computing is the service of providing storage, services, databases, software, security, analytics, artificial intelligence and infrastructure through the internet. There was a time when most businesses built their own server racks, and maintained their own infrastructure. Amazon too did this for themselves in building out their own infrastructure to maintain their E-Commerce platform. In time, they naturally sold this service to other firms.
So where does Amazon fit in now? From all indications cloud computing appears to be an arms race. The most recent estimates for market share vary depending on the research provider. The differences lie in what is being measured. There are multiple components of Cloud: PaaS, IaaS, and SaaS. By all accounts, Amazon Web Services is the clear market leader, but they aren't growing as fast as some of their well funded peers like Microsoft and Google.
The available literature on Cloud Computing as a whole is vague. There are important questions to answer regarding structural advantage or lack thereof, who has the competitive edge, or what kind of moats have been built. Amazon's slowing growth rate in Cloud is concerning. Ramped spend in R&D + SG&A during the 2019 fiscal year is encouraging, and these investments will reduce erosion of market share.
While Cloud remains Amazon's most profitable business segment for now, by revenue it's just ~12.5% of sales. Admittedly I am troubled by the amount of information I cannot obtain without significantly paying out of pocket. Nevertheless, given the relative size of this business, I'm comfortable putting the pencil down on AWS for now, and watching the industry closely going forward.
Other Business Segments:
Amazon has other business segments like their own B&M retail stores including Whole Foods, it's 4 star retail chain as well as it's cashierless Amazon Go stores. All of these combined are worth little compared to the market cap, while interesting.. they are insignificant in determining Amazon's value as a business.
What is Amazon worth today?
Herein lies the problem for analysts when the look at Amazon. The most commonly used methods for determining value are off the charts, for the most part Amazon looks like lighting money on fire.

https://preview.redd.it/7iq4kk8hesa41.png?width=1703&format=png&auto=webp&s=e7b8a9fb6090406db8e0ddd51e9e776062b646cd
A simple value oriented investor looks at a trailing P/E of 84.19 and thinks why would I wait 84 years to get paid back?

https://preview.redd.it/d76fratiesa41.png?width=1689&format=png&auto=webp&s=0cc4e3e57054f658a33a7173084e1a5338da1997
Of course, that's too myopic, and value oriented investors who take that approach, quickly learn trailing P/E is the key to building a portfolio of value traps. More sophisticated investors like Joel Greenblatt might recommend using something like ROIC to gauge how much Amazon benefits from reinvesting and building out it's own business.
The problem with that approach is that ROC, ROCE, and ROIC all use some form of GAAP earnings (either NOPAT or EBIT) to backsolve for this return number. If you look at Amazon's Income Statement, and dissect why net income is what it is there's a good reason why most value metrics/ratios don't work for Amazon. They are investing ~3x NOPAT and 60% of Gross profit into R&D. SG&A tells a similar story. What is R&D anyways? One time costs to develop and build out a business. What is SG&A, variable manpower with a significantly lagged ROI when ramped more than 20% YoY.

https://preview.redd.it/15v33d1lesa41.png?width=890&format=png&auto=webp&s=d4562988962ffc48d858a24b2a190b4db65f4c3d
What dawned on me months ago is this.. what if Amazon cut it's R&D to 0, and didn't touch SG&A? P/E TTM drops to ~20x. What happens to sales growth then? It slows.. and eventually converges with GDP, and then falls beyond that. The story of what Amazon's business is, especially E-Commerce, helps shed light on how long it'd take for Amazon's growth to converge with GDP, when they're on the cutting edge of the knife, and most other competitors remain far behind.
What do other institutions believe Amazon is worth?
https://preview.redd.it/wuzx3n6nesa41.png?width=482&format=png&auto=webp&s=959d83285bb9f67715415a9011802e6039d72d2d
There are 45 Wallstreet Analysts covering the stock. On average, their price target is 2170. Based on the share price today, if they're right, you can expect a 15% return. What if the bears are right? You'll lose ~2% rounding down. And the bulls? the highest estimate is 2550, and represents a 35% premium on the stock.
Here's what Morningstar thinks:

https://preview.redd.it/capam6koesa41.png?width=598&format=png&auto=webp&s=b2ae1e2e6b91882f60c01dec9cb983c8439ccfa8
Keep in mind, the last price is a bit dated. Let's pretend Morningstar is right, I like them more than most analysts. You can expect a 22% return.
I don't like wall street analysts, if I did, I wouldn't do this, and I'd just follow their guidance. They are often right, but can be very wrong at times. The problem with wall street analysts is that they are subject to herding, as well as many other behavioral biases and sometimes conflicts of interest.
But assuming they're right, this is an asymmetric long to take, with significant upside today.
I have an estimate for fair value as well. This involves taking the current growth rate for amazon as well as the mean estimate of earnings two years out. However, instead of earnings, I like mean cash flow per share, because it remains undistorted by GAAP adjustments.
Here are the current cash flow per share estimates:

https://preview.redd.it/9e4sgdmqesa41.png?width=773&format=png&auto=webp&s=d878cacc7620af283233c63ab493c6500b55ba0c
Here is my valuation model:

https://preview.redd.it/3pqriw0sesa41.png?width=1694&format=png&auto=webp&s=16810d9c5ad87ca7b10b01ae3cb590e774f28340
Bottom left in yellow: that is the implied value of AMZN shares today, based on the discounted free cash flows.
Bottom middle with a red circle around it, those are my assumptions for long term growth rate and EPS 2 years out.. so TTM 2021 cash flows.
This would imply a 63% upside on the share price today.
Now, I don't think anyone is getting 63% today, for AMZN shares. Admittedly I'd be surprised if you got ~$3100 for AMZN shares in a year. Unfortunately.. this business will probably continue to be misunderstood like it has been for many years until they're done reinvesting a significant portion of their gross profit into building the infrastructure that expands their business. However, that cash flow number will become remarkably close to EPS with R&D turned off. When it does, share price will rocket. Instead of this becoming a one time event, I expect convergence will be gradual over time, which makes it a long term hold.
More on valuation:
I was disappointed but not surprised to find I'm not the only one thinking about valuation in this way. The authors take is similar to mine, and he comes to a similar conclusion as well: ~20x P/E TTM. I've gone through everything the VIC has to say about AMZN and most everything should be available to you as non-members as it is dated. I found message 109 especially compelling:

https://preview.redd.it/g91fx2ptesa41.png?width=1221&format=png&auto=webp&s=4edce5cbfdb19ae88045ad45b574ee1d7ff60694
In Conclusion: I recommend Amazon stock as a long term investment. I believe this is one of the best value propositions available in this market. Regardless of the broader stock market, the secular trends within retail are significant tailwinds to Amazons largest business segment.
Disclaimer: This document is entirely my own work, outside of linked/pictured information above which has been cited. I own a significant amount of AMZN stock personally. I am not responsible for your gains or losses. I may add more information to this document in the future.
Addendum (1/14/20): The most significant risk to this business is political. The election of either Warren or Sanders in November of this year would most certainly affect valuation for this business in the near term. Whether Amazon is actually harmed by political interference is another story. For now, it appears the odds that either of these candidates receives the nomination is significantly below 50%, furthermore, as of now it appears they would be significantly disadvantaged against the orange man. Consider this tail risk.
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Amazon Prime Day 2020: Best Deals Reddit

Amazon Prime Day 2020 reddit: the best early deals ahead of October 13
Here are the Amazon Prime Day 2020 deals ahead of the October 13 start date
Top 10 early deals
Laptop deals
TV deals
Audio deals
Phone and tablet deals
Wearables deals
Gaming deals
Smart home deals
Camera deals
Home and kitchen deals
THE BEST AMAZON PRIME DAY DEALS 2020 reddit
Jump straight to the deals you want...
  1. Best early deals available now
  2. Laptop deals
  3. TV deals
  4. Audio deals
  5. Phone and tablet deals
  6. Wearables deals
  7. Gaming deals
  8. Smart home deals
  9. Camera deals
  10. Home deals

Amazon Prime Day 2020 is just around the corner, which means the deals are already starting to hit the shelves. We're already seeing significant discounts on everything from TVs to laptops and headphones to smartwatches, with some of the strongest savings being on Echo devices themselves. We're just days away from Amazon Prime Day deals landing fully, so we're rounding up all the best offers available now and keeping this page updated with all the latest information.

Remember, you'll need an Amazon Prime membership to take advantage of the best Prime Day deals when the rest of the offers do become available. You can take part by grabbing a 30 day free trial right now, which will cover you for Amazon Prime Day itself, as well as plenty of time after. You can always cancel before it auto-renews.

Sign up for a free 30 day Amazon Prime trial
With so many early Amazon Prime Day deals available now, there's already a wide variety of savings to get stuck in with. Bookmark this page, because we'll be bringing you all the new discounts as they come in.

Amazon Prime Day deals: quick links
Amazon Echo Spot x2: $259.98 $149.98 at Amazon
Blink Mini smart security camera: $34.99 $24.99 at Amazon
Amazon Echo Show 5: $89.99 $44.99 at Amazon
Amazon Echo devices: save on Echo Spot and more now
Laptop deals: PCs and MacBooks discounted
TV deals: 4K smart TVs on sale now
Headphone deals: save on headphones and speakers
Phone deals: save on new releases and older models
Tablet deals: iPad and Samsung Galaxy tablet deals live now
Wearables deals: browse smartwatches and fitness trackers
Gaming deals: PC, PS4, Xbox One, and Nintendo Switch discounts
Smart home deals: save on robot vacuums and more
Camera deals: home security cameras 30% off
Home and kitchen deals: save on appliances and kitchen gadgets
BEST EARLY PRIME DAY DEALS AVAILABLE NOW


Blink Mini smart security camera: $34.99 $24.99 at Amazon
Prime members can already save $10 on this Blink Mini smart security camera ahead of the rest of this year's Amazon Prime Day deals next week. That's an excellent price for the 1080p HD camera with motion detection and night vision.
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Amazon Echo Show 5: $89.99 $44.99 at Amazon
The Amazon Echo Show 5 is down to its lowest price ever for Prime members this weekend. That means you can save $45 on this smart display well ahead of the full Amazon Prime Day sales event.
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Amazon Echo Spot x2: $259.98 $149.98 at Amazon
Grab two Amazon Echo Spot smart displays and you can save $110 off the original price with promo code ECHOSPOT2PK at checkout. That's a fantastic discount, but if you're only looking for one you can still take $40 off the original price, bringing it down from $129.99 to $89.99.
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All-new Toshiba 43-inch smart UHD 4K TV: $329.99 $229.99 at Amazon
You can upgrade to 4K ultra-high definition for just $50 more than the 1080p TV deal above with this all-new Toshiba 43-inch display. You're keeping all the Fire TV functionality, but the new 2020 model brings Dolby Vision HDR to this low price point as well.
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All-new Insignia 50-inch smart UHD 4K TV: $349.99 $299.99 at Amazon
Need something with more screen space? This Insignia 50-inch 4K TV is also seeing a $50 discount in the early Amazon Prime Day deals this week. That's a stunning price on a 50-inch display, and definitely one to take note of if you're looking for the big screen experience.
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Save up to 60% on subscription boxes at Amazon
If you've been looking to add a little mystery to your mail every month, you will no doubt have looked into subscription boxes. Amazon, however, has just discounted a massive range of these memberships by as much as 60% ahead of its Prime Day deals next month.
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Save up to 20% on furniture at Amazon
From the living room to the bedroom, you'll find a massive range of furniture items and home decor available for up to 20% in these early Amazon Prime Day deals this week.
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Amazon Kids Plus Family Plan: $29.99 $0.99 on Amazon
Enjoy unlimited access to thousands of kid-friendly content, including movies, books and educational games and apps. Starting at $2.99 per month, this deal nets you three months for just $0.99. Offer ends October 12.VIEW DEAL



Amazon Music Unlimited free trial: $0.99 / £0.99 at Amazon
Amazon Music Unlimited trials usually max out at 90 days, but UK Prime members can pick up four months of access to Amazon's on-demand, 60 million-strong library for just £0.99 ahead of Prime Day deals. Shoppers in the US can also pick up three months of Music Unlimited for free as well.
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Two Kindle books for $1.99 each (free for Prime members) at Amazon
Prime members get two free Kindle books, and non-Prime members can pick them up for just $1.99. That means everyone wins in these early Prime Day deals.
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Spend $10 with small businesses, save $10 on Prime Day at Amazon
This year, Amazon wants to reward you for shopping with smaller businesses in the lead up to Prime Day. That means that you can now claim $10 for Prime Day for every $10 you spend with small businesses - it's a win-win.
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THE BEST AMAZON PRIME DAY LAPTOP DEALS


Asus VivoBook 11.6-inch laptop: $283.98 at Amazon
There aren't many cheap laptops on sale right now, but this Asus VivoBook from Amazon is sitting pretty at just under $290 right now. For your cash you're getting 64GB of storage and 4GB RAM so this is better suited to light everyday browsing rather than demanding workflows.
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Acer Aspire 1 15.6-inch laptop: $499 $399 at Amazon
For $100 more than the offer above, you can upgrade your processor to an Intel Celeron N4020 for speedier work and boosted power. You're keeping the same 4GB RAM and 64GB of storage space here, and picking up Office 365 Personal as well.
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2020 Asus VivoBook 15.6-inch laptop: $669 $589 at Amazon
The latest Asus VivoBook model is seeing an $80 price cut at Amazon this week - an excellent saving on a mid-range laptop with some decent specs inside. You'll find a 10th generation 3.4GHz i3 processor, 12GB RAM, and a 128GB SSD inside.
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Acer Nitro 5 15.6-inch gaming laptop: $698 at Amazon
You're paying just under $700 for a great set of specs on this entry level gaming laptop. With a 9th generation i5 processor, GTX 1650 graphics, 8GB RAM, and 256GB SSD at the helm there's plenty to get stuck into here.
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2020 Apple MacBook Air: $999 $949 at Amazon
Save $50 on this 256GB configuration of the latest MacBook Air. That's some serious value for money, even without the early Prime Day discount. However, if you need more power under the hood you can save $99 on the 512GB model as well.
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Razer Blade Stealth 13.3-inch gaming laptop: $1,799.99 $1,499.99 at Amazon
It may be small, but this super portable Razer Blade Stealth packs a serious punch. You're picking up a 10th generation i7 processor inside, with 16GB RAM, a 512GB SSD and Nvidia GeForce GTX 1650Ti Max-Q graphics. All of that sits in an aluminium chassis with full Chroma RGB and a 120Hz display.
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Apple MacBook Pro 16-inch: $2,399 $2,099 at Amazon
Save $300 on the 16-inch MacBook Pro at Amazon this week - an excellent price drop that brings the final cost down to its lowest ever. You're getting a powerful i7 processor inside, with 16GB RAM and a 512GB SSD.
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THE BEST AMAZON PRIME DAY TV DEALS


TCL 32-inch 720p Roku smart TV: $199.99 $129.99 at Amazon
This 32-inch TCL Roku smart TV doesn't offer 4K resolution, in fact you're only getting 720p here, but it does come in with a good discount this week. If you're after a small secondary display, this is a great shout ahead of Amazon Prime Day.
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All-new Toshiba 43-inch smart UHD 4K TV: $329.99 $229.99 at Amazon
This all-new Toshiba 43-inch display has a $100 price cut at Amazon right now. Not only are you picking up easy Alexa and Fire TV functionality, but the new 2020 model brings Dolby Vision HDR to this low price point as well.
VIEW DEAL



All-new Insignia 50-inch smart UHD 4K TV: $349.99 $299.99 at Amazon
Need something with more screen space? This Insignia 50-inch 4K TV is also seeing a $100 discount in the early Amazon Prime Day deals this week. That's a stunning price on a 50-inch display, and definitely one to take note of if you're looking for the big screen experience.
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All-new Toshiba 50-inch smart UHD 4K TV: $379.99 $329.99 at Amazon
This Toshiba 50-inch TV does offer Dolby Vision HDR for the extra cash, and has $50 off ahead of Amazon Prime Day. That's a great saving on an impressive TV that offers up an excellent display considering its price point.
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Sony 65-inch X900H Smart 4K Ultra HD TV: $1,399.99 $998.99 at Amazon
Packed with premium features, the 2020 Sony 65-inch 4K TV gets a $400 price cut in Amazon's early Prime Day deals. The Ultra HD smart TV features a game mode for a super-smooth experience and works with Amazon Alexa and the Google Assistant.
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LG BX OLED TV | LG XBOOM speaker: $1,496 at Amazon
$1,496 is already cheaper than other retailers' price tags on this 55-inch LG BX OLED TV, but Amazon is also throwing in a free LG XBOOM speaker. That's fantastic value and a nice saving all in one.
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THE BEST AMAZON PRIME DAY AUDIO DEALS


JBL Clip 3 waterproof portable bluetooth speaker: $69.95 $39.95 at Amazon
We've only seen this JBL speaker go cheaper over Black Friday last year, so $39.95 is the lowest the Clip 3 has gone in 2020. You're getting IPX 7 waterproofing and 10 hours of battery life here.
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Sony MDRXB650BT/B extra bass headphones: $129.99 $54.95 at Amazon
These headphones are usually on sale, but we've only seen them drop down to this $50 price region in the last couple of months. You'll find them for $54.95 ahead of Amazon Prime Day, with $75 saving overall.
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Logitech Z333 2.1 speaker system: $79.99 $59.99 at Amazon
The Logitech Z333 speaker system offers plenty of power and bass for your PC, TV, or gaming setup. Plus there's an easy access volume control dial that makes the whole thing just that little bit more luxurious. You'll find a $20 discount at Amazon right now as well.
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Samsung Galaxy Buds+: $149.99 $129.99 at Amazon
Save $20 on the previous generation Samsung Galaxy Buds before the Prime Day deals have even fully kicked off. This price cut matches the lowest Amazon has dropped these true wireless earbuds' cost.
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AirPods with wireless charging case: $199 $159.99 at Amazon
If you don't need the extra power and noise cancellation of the AirPods Pro below, you'll find a $39 discount on the standard 2019 AirPods this week. This is the wireless charging case version as well - perfect if you've already got some Qi chargers around the house.
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Sony WF-1000XM3 true wireless earbuds: $229.99 $178 at Amazon
We rated the Sony WF-1000XM3 true wireless earbuds highly this year, and though we've seen this $50 discount for a while now, it's an excellent price for the power you're getting in these noise canceling buds.
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Beats Solo Pro: $299.95 $199.95 at Amazon
The Beats Solo Pro headphones are $100 off at Amazon right now, but only if you're after selected colors. The variants included in this deal are the Red, Dark Blue, and Light Blue models.
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AirPods Pro: $249 $219 at Amazon
We finally started seeing some movement on that AirPods Pro price in the summer, and now you've got another chance to pick up the latest noise canceling earbuds from Apple at a fantastic price. A $30 price drop returns these Pros down to their lowest ever price at Amazon this week.
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THE BEST AMAZON PRIME DAY PHONE AND TABLET DEALS


Samsung Galaxy Tab S6 Lite: $349.99 $279.99 at Amazon
Save $70 on the 10.4-inch Samsung Galaxy Tab S6 Lite this week. You're getting 64GB of storage here, with the S Pen included as well. That's a lot of value considering this is one of the lowest prices we've seen yet (it dropped down to $277 in September).
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Apple iPad Mini 5: $399 $349.99 at Amazon
The 64GB iPad Mini 5 has just returned to its lowest ever price at $349.99. That's an excellent $50 saving on the dinky tablet with plenty of power under the hood to make for an excellent browsing, gaming, and streaming companion.
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Samsung Galaxy Tab S5e: $399 $349.99 at Amazon
The Samsung Galaxy Tab S5e is also down to $349 ahead of Amazon Prime Day. This 2019 tablet offers up 64GB of storage and a 10.5-inch Super AMOLED display.
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Samsung Galaxy S20 FE 5G: $699.99 $599.99 at Amazon
This brand new budget release in the Samsung Galaxy S20 line is already seeing a $100 price drop, and that's before the Prime Day deals have even begun. You're picking up 128GB of storage here, in an excellent smartphone considering its price point.
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Google Pixel 4: $799 $628.50 at Amazon
Grab the Google Pixel 4 for just $628.50 at Amazon. That's a fully unlocked, 64GB phone for a great price ahead of Amazon Prime Day itself.
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Samsung Galaxy Note 20 5G: $999.99 $799 at Amazon
Save $200 when you buy the 5G Samsung Galaxy Note 20 outright at Amazon. This 128GB model is unlocked and ready for use with any network.
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2020 Apple iPad Pro 11-inch: $799 $749.99 at Amazon
Save $50 on the latest iPad Pro to hit the shelves. The 11-inch iPad Pro is perfect if you're looking for all the power of the latest release but don't want to carry a larger 12.9-inch display, and plus it often comes in with a considerably cheaper price tag. That's certainly the case this week, with an extra $50 off bringing the 128GB model down to just $749.99.
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2020 Apple iPad Pro 12.9-inch: $999 $949 at Amazon
The latest iPad Pro is seeing a $50 discount on the 12.9-inch, 128GB configuration right now. That's not a lot of storage considering the power you're getting under the hood, but if you're a keen iCloud user this is well worth a look.
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THE BEST AMAZON PRIME DAY WEARABLES DEALS


Apple Watch Series 3: $199 $169 at Amazon
Amazon has had the lowest price on the Apple Watch Series 3 for a while now, but you've got another chance to grab it for just $169 before the Prime Day crowds appear. This is a great price on a super cheap Apple smartwatch that is still fully supported by the latest updates.
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Fitbit Ionic: $249.95 $189 at Amazon
The Fitbit Ionic offers personalized onboard coaching straight from your wrist, as well as built in GPS, NFC payment system, and music features as well. Plus, you're saving $60 on this all-in-one device this week.
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Garmin Vivoactive 4: $349.99 $295.65 at Amazon
Grab the Garmin Vivoactive 4 fitness tracker for $54 off at Amazon. This smartwatch features a massive range of monitoring features including stress, sleep, heart rate, hydration, and Pulse Ox. Plus you can use Spotify, Amazon Music and Deezer straight from your wrist and use more than 20 onboard sports apps.
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Samsung Galaxy Watch 3: $399.99 $369 at Amazon
This is the latest Samsung Galaxy smartwatch to hit the market, so such an early discount is much appreciated, and all the more impressive considering the Amazon Prime Day deals haven't fully begun yet.
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THE BEST AMAZON PRIME DAY GAMING DEALS


Orzly Nintendo Switch accessories bundle: $69.99 $39.72 at Amazon
Orzly is a well known brand when it comes to Nintendo Switch accessories, and you can get a full collection together with this bundle offer. From tempered glass screen protectors to carry cases, game card boxes, steering wheels, extra cables, stands, thumbstick grips, and more are all available here for a great price.
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Razer Mamba Elite wired gaming mouse: $89.99 $59.99 at Amazon
Save $30 on the Razer Mamba Elite wired gaming mouse at Amazon this week. You're getting 9 customizable buttons onboard, with mechanical switches and a 16,000 DPI optical sensor as well.
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Logitech G604 wireless gaming mouse: $99.99 $69.99 at Amazon
This is the lowest price we've seen on the Logitech G604 Lightspeed gaming mouse. The wireless pointer offers up 15 programmable buttons, the Hero 16K sensor, and ultrafast Lightspeed technology under the hood as well.
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Logitech G903 wireless gaming mouse: $149.99 $99.99 at Amazon
The G903 is, however, coming in just a little more expensive than the G604 today. You can save $50 on the Lightspeed mouse, with all the speed of the previous pointer but added ambidextrous design and PowerPlay compatibility.
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Logitech G PRO mechanical gaming keyboard: $129.99 $118.99 at Amazon
You're only saving $11 here, but this is the cheapest we've seen the Logitech G PRO go. That's an excellent price, then, for the tenkeyless design, with wireless functionality and RGB Blue Click switch keys.
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Razer Basilisk Ultimate wireless gaming mouse: $169.99 $159.99 at Amazon
There's a $10 discount available on this Razer Basilisk Ultimate gaming mouse, but we've seen it go down to $149 before. Keep an eye on this one over the full Amazon Prime Day deals onslaught, then, though there's no guarantees it will be any cheaper next week.
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Nintendo Switch: $299 at Amazon
The Nintendo Switch is back in stock, and just in time for Prime Day. Of course, this is going to move quickly, so if it's unavailable for you now keep checking back because we've seen Amazon refreshing its stock much more frequently over the last few weeks.
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Nintendo Switch Animal Crossing Edition: $299 at Amazon
The Nintendo Switch Animal Crossing Edition is also back in stock this week, but again - if you don't see any units available keep checking back because we expect more to be on the way shortly.
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THE BEST AMAZON PRIME DAY SMART HOME DEALS


Blink Mini smart security camera: $34.99 $24.99 at Amazon
Prime members can already save $10 on this Blink Mini smart security camera ahead of the rest of this year's Amazon Prime Day deals next week. That's an excellent price for the 1080p HD camera with motion detection and night vision.
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Kasa TP-Link smart plugs 4-pack: $49.99 $26.99 at Amazon
Smart plugs are a must if you want to turn your everyday electronics into smart ones. Compatible with Alexa and Google Home, these outlets are up for a great price here, with 46% off the MSRP.
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Amazon Echo Dot: $49.99 $39.99 at Amazon
You can save $10 on the Amazon Echo Dot right now, but we've seen better prices on these smart speakers before. If you need it right now, it's a decent discount, but we'd recommend waiting for Amazon Prime Day itself on this one.
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Amazon Echo Show 5: $89.99 $44.99 at Amazon
The Amazon Echo Show 5 is down to its lowest price ever for Prime members this weekend. That means you can save $45 on this smart display well ahead of the full Amazon Prime Day sales event.
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Amazon Echo Spot x2: $259.98 $149.98 at Amazon
Grab two Amazon Echo Spot smart displays and you can save $110 off the original price with promo code ECHOSPOT2PK at checkout. That's a fantastic discount, but if you're only looking for one you can still take $40 off the original price, bringing it down from $129.99 to $89.99.
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Shark ION robot vacuum: $219.99 $149.99 at Amazon
For just under $150 you can pick up the Shark ION robot vacuum, complete with 120 minute runtime battery and powerful cleaning for a range of floor types. This is the cheapest this robot vacuum has ever been - an excellent price ahead of Amazon Prime Day itself.
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THE BEST AMAZON PRIME DAY CAMERA DEALS


Polaroid Originals OneStep 2 instant camera: $129.99 $99.99 at Amazon
Even though Fujifilm has dominated the rejuvenated instant camera market with its Instax Mini, Polaroid is still in the game. You'll find this retro-looking camera available for $30 off right now, ahead of Amazon Prime Day itself.
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GoPro Hero 7 Silver: $229.99 $199.99 at Amazon
Save $30 on the GoPro Hero 7 Silver, a perfectly good everyday action camera if you don't want to spend the big bucks on the latest releases. You're getting a 4K 30fps camera here with waterproofing and live stabilization in this slightly older model.
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DJI Osmo Pocket handheld 3-axis gimbal stabilizer with camera: $399 $299 at Amazon
You'll find this 3-axis gimbal stabilizer complete with integrated 12MP 4K camera available for $100 less at Amazon right now. Plus, with the DJI Mimo app, you'll be able to use this device with your Android or iOS smartphone as well.
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DJI Mavic 2 Pro drone: $1,729 $1,599 at Amazon
The mega-powerful DJI Mavic 2 Pro drone is down to $1,599 at Amazon right now. That's an excellent price for the all-in-one piece of gear, with 3-axis gimbal, HDR 4K footage, a 20MP camera, and around half an hour of flight time.
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THE BEST AMAZON PRIME DAY HOME AND KITCHEN DEALS


Cusimax portable hot plate burner: $50.99 $33.99 at Amazon
Whether you're looking to take your cookery skills to the great outdoors, or after something hot to eat in your dorm room, the Cusimax portable hot plate is available for a great price right now.
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Ultrean 4.2 Qt air fryer: $95.99 $75.99 at Amazon
Save $20 on the Ultrean air fryer this week, well ahead of Amazon Prime Day itself. You're picking up a 1500W air fryer here, with an LCD digital screen, non-stick frying pot and easy cooking setup.
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Keurig K-Classic coffee maker: $89.99 $79 at Amazon
You can pick up this Keurig pod coffee machine for $10 less right now. The K-Classic coffee maker offers up 6 to 10 ounce brews from a 48 ounce water reservoir which is good for at least six cups before refilling.
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Cosori Max XL 5.8Qt air fryer: $119.99 $99.98 at Amazon
This Cosori air fryer offers 11 presets, 1700W of power, and plenty of room for a wide variety of meals. Plus, you're saving $20 in these early Amazon Prime Day deals, which brings the final price down to under $100.
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KitchenAid Queen of Hearts stand mixer: $399.99 $279.99 at Amazon
Save $120 on this limited edition KitchenAid stand mixer at Amazon this week. You're picking up a 5Qt capacity mixer here, with the stainless steel bowl to go with it.
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Breville Barista Express Espresso machine: $699.95 $599.95 at Amazon
If you love coffee, and we mean you really love coffee, you'll want to check out this $100 saving on the Breville Barista espresso machine. All those Starbucks points might be going to waste, but you'll have a sublime coffee experience straight from home.
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When is Amazon Prime Day 2020 date?
The Amazon Prime Day date is Tuesday, October 13 to Wednesday October 14 in 2020, a set of dates delayed by the COVID-19 pandemic. We're already seeing early bird Prime Day deals landing over the past few days, however, so there's likely to be more discounts available in the lead up.

The Amazon Prime Day date is a little over a month ahead of Black Friday and Cyber Monday 2020, and likely days before US retailers launch their early Black Friday deals. So we don't see the deals stopping from October 13 through the end of 2020.

Amazon Prime Day deals: what will be on sale?
You can expect Amazon Prime Day deals to hit the retailer's own line of Echo and Fire smart home products hardest, as well as other gadget brands like Blink and Ring that Amazon also now owns. However, we also regularly see laptops, TVs, headphones, smartwatches, and tablets on sale over Amazon Prime Day, and with 2020 being so competitive there's likely to be something for everyone out there.

New on Prime Day 2020
The Amazon Prime Day 2020 homepage is already touting early deals exclusive to its Prime members, including the Amazon Echo Dot 2-pack for $39.98 and the Amazon TV Recast for $129.

Amazon also announced that it's going to be offering a $10 savings on buying from US small businesses during Prime Day. The only catch? You have to spend at least $10 to save another $10. That seems like an excellent way to build support around the mega-retailer that's often seen as hurting small businesses.

Prime Day 2020 deals: our predictions
The Amazon Prime Day deals list quite often follows the same trends every year, so we can safely assume what to expect.

The best Prime Day 2020 deals will almost certainly feature deep discounts on Amazon's own tech. We're talking about Kindle deals, Echo price drops, and Fire TV discounts.

We've also seen Prime Day become known for good laptop deals, no matter what you're interested in. That includes cheap Chromebooks, Windows laptops and a few Apple MacBooks. Now the latest MacBook Pro is on sale, expect it to go fast.

Let's get into the stats that we alluded to above though - as expected, it's going to be Amazon bringing down the cost of its smart home items that will perform strongly.

The top product during Black Friday last year for Amazon was, according to Hitwise, the Echo Dot, whereas it was the Fire TV Stick 4K during Prime Day. However, the list of top-five purchased products on both holiday periods was dominated by Amazon goods, with the only variance in the top 10 coming via Instant Pots, which were more popular in November, as well as Amazon gift cards.

When we look at the searches during Prime Day though, we see a different story. Any Prime Day Nintendo Switch deals are certain to be massively popular, if a decent offer pops up, as that's what people were looking for last year - and thanks to lockdown, the clamor has only grown.

TV deals, Fitbit deals and headphones deals were also incredibly popular, and while there clearly weren't the barnstorming offers that we see during the later holiday buying period, Amazon will be hoping to steal a march on rivals if it can offer some of these.

Amazon Prime Day laptop deals: what to expect
While we've seen demand for cheap laptops rising over the past year - and lots of stock issues at the height of the pandemic - Amazon's Prime Day laptop deals may still offer some excellent discounts. We've seen Apple's range of luxury MacBooks taking some particularly impressive price cuts over the past few months, especially on the already-cheap MacBook Air 2020, and models like the Asus Vivobook, Acer Swift, and HP Chromebook have all offered lower budget savings as well.

That means we'd recommend checking out this year's Amazon Prime Day laptop deals for a computer between the $300 and $800 price range. There are more savings to be found further up the price scale at Amazon, on the Dell XPS, Asus Zenbook Pro Duo, and MacBook Pro, for example, but more specialized creative retailers like B&H Photo or the manufacturers themselves have proven to have the edge of price here over 2020.

On the flip side of this rise in demand, however, sits stock issues, most accurately epitomized by the plight of the Chromebook shopper in 2020. Last year we saw HP and Lenovo Chromebooks sitting well under $200 in Amazon Prime Day laptop deals. However a surge in demand has left these machines pushing $250 - $280 sales prices at best in recent months. Plus, over Labor Day we saw HP itself offering far better prices on its HP 15z configurations, so don't discount manufacturer offers in the cheaper ranges either.

Gaming laptop deals have, however, found a home at Amazon in the past 12 months. Again, you're better off heading to Dell for Dell G-Series or Alienware rigs, but the cheaper Acer Nitros and HP Omens have had a good record so far in the year, and may be a strong source of Amazon Prime Day laptop deals as well.

If you're looking to spend between $500 and $1,200, however, you might be tempted to hold off and see what manufacturers offer during Black Friday. While we do typically see higher value laptop deals later on in the year, this isn't a typical year and with Prime Day coming much closer to the November sales, we don't know how far Amazon is going to go to try and compete in the busier shopping period.

While it's likely that there will be flash sales offering lower prices over Black Friday, you'll have to fight for them. We might, however, see Amazon Prime Day laptop deals, even if they are lightning offers, worthy of last year's Black Friday-level attention, so don't hold out expecting cheaper offers in November as they're not guaranteed, and competition may be higher as well.

Amazon Prime Day TV deals: what to expect
Amazon Prime Day TV deals often excel in the cheaper and top end of the price spectrum, with budget sets discounted to extra low prices and top of the line LG or Sony OLEDs or Samsung QLED displays taking bigger discounts over the shopping period.

We see cheaper budget models like Insignia, TCL, and Hisense TVs regularly on sale throughout the year, and 2020 has been no different. So far, we've seen these sets drop to between $219 and $299 at their cheapest points, so if you're simply looking to upgrade from a standard HD TV without breaking the bank, signs are pointing to a healthy supply of Amazon Prime Day TV deals.

We'd recommend checking Amazon's prices against retailers like Walmart and Target, however, as these supermarket TVs can become a bidding war during bigger sales periods and you may be able to swoop on a better price once Amazon has made its discounts. We see this behaviour particularly with Insignia and TCL displays at Walmart.

However, you might want to stick with Amazon if you're looking for its exclusive Fire TV and Amazon Alexa compatibility. Amazon often bakes its smart assistant straight into these sets to gain the edge over competitors, and as a more premium feature in itself, you can sometimes pick up a far higher value Prime Day TV deal at Amazon.

If you're looking for a display that sits well above these budget models, for full display brightness, color clarity, and perhaps some extra features as well, you're in luck. Last year, Amazon discounted the LG OLED C9 down from $2,499 to $1,699 over its Prime Day TV deals, so if you're looking to splash the cash you might find a win here.

However, Amazon struggles to compete in the mid-ranges in the US, so if you're looking for a TV deal between $300 and $600 (the newest Samsung and LG 4K TVs, for example), you might want to check out other retailers' competing sales or wait until Black Friday.



(Image credit: Shutterstock)
Buy on Amazon Prime Day? Or wait until Black Friday?
This question was a lot easier when the Prime Day 2020 date was set for July, but now it's likely to be so close to Black Friday that there'll almost be a gravitational pull of deals.

The key thing here is the difference in the kinds of deals we'll be seeing. The Amazon Black Friday sales are tipped to begin at the end of October, so the Prime Day deals will have to be different to stop Bezos' brand from just running a sale for three months straight.

What's interesting, when you compare the Hitwise data from last year, is that in both cases the top purchases mirrored the mood of the time - in both Prime Day and Black Friday, Amazon products saw the biggest sales, but the AirPods Pro snuck in during the November period where it was a personal water filter and a DNA kit that made the top 10 in July.



(Image credit: Amazon)
How to shop on Prime Day in 2020
  1. Check out our deals predictions and, eventually our Prime Day deals list

There are also too many deals available on Prime Day. It's never a problem finding discounts, it's always an issue of figuring out what deals are worth your money. That's why we always set up a curated list during the 48-hour sales marathon.

We spent some good time last Black Friday thinking about smart ways to shop on Amazon - they're still some great Prime Day tips and tricks.

  1. Amazon Prime Day has historically required being a Prime member, so be sure to have a subscription on Prime Day

Amazon started Prime Day in 2015 as a clever way to drive up its Prime subscription count, and this online shopping marathon – conveniently opposite Black Friday – accomplished just that.

You'll need to sign up for Prime (you can get a free 30-day trial), which comes with two-day free shipping and Prime Video access, among other smaller perks. In some cities, Amazon has rolled out free one-day and same-day shipping on certain items.

  1. Create a wish list to curate what you want, as there will be loads of deals

You're also going to want to create a wish list ahead of time, which will let you sort out what you want and how much everything costs. This will give you a head start. You'll be able to see which deals dropped in price and which did not.

  1. Snap up the best Prime Day 2020 deals before they're gone
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