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Strategy Amazon is changing Prime Day to make sure sellers bring the best deals (AMZN)

Amazon is upping the fees for sellers to list their items as "lightning deals" for Prime Day, likely lessening the number of and potentially increasing the quality of deals offered.

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Some Amazon employees just got a raise.

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  • Amazon's annual Prime Day is coming July 16 and running for 36 hours.
  • During Prime Day, Amazon's limited-time "lightning deals" become the star of the show.
  • This year, Amazon is raising the price for sellers to list lightning deals, which could eliminate some of the weaker offers.

Amazon is taking another step to ensure that Prime Day is filled with only the deals customers want this year.

According to CNBC, the e-commerce giant is increasing the cost for third-party sellers to participate in the much-hyped "lightning deals," limited-time offers that are usually considered the steepest discounts of the 36-hour holiday.

Last year was the first that Amazon required sellers to pay a fee to list an item for a lightning deal. It charged $500 per item. This year, Amazon is asking for $750 — an increase of $250 per item.

On a normal day, running a lightning deal costs a seller $150 per item.

The price increase will likely ensure that sellers only list their hottest products as lightning deals.

"The fee hike is going to make the sellers be more intentional with what products and deals they're going to choose," Sean Adams, an analyst at marketing agency Merkle, told CNBC.

What that means for the customer on Prime Day: only the most desirable, surefire-selling items will likely be offered by third-party sellers for the holiday. Sellers also likely won't use Prime Day's increased exposure to offload items that aren't selling, making sure only the top deals get the special feature treatment.

Amazon has lightning deals going on all the time on its website, but they become much more important during Prime Day due to the traffic increase it brings to Amazon. The deals are restricted to Prime members for the entire day, and Amazon will show them to customers seeking Prime Day deals.

Prime Day is now in its fourth year — it started in 2015 — but it's grown quickly. It's now one of the biggest sales days on Amazon's calendar, rivaling only Black Friday in importance.

In 2017, Amazon said Prime Day led to "more new Prime members joining Prime than any single day in Amazon history." It was also the largest single sales day in the company's history, eclipsing Black Friday in 2016. It would later itself be eclipsed by 2017's Cyber Monday, which remains Amazon's biggest sales day in history.

As Prime Day grows larger, its significance grows as well. Prime is increasingly important to Amazon, as members tend to be more loyal to the website and shop there before they go anywhere else. They also tend to purchase more items and more frequently.

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