CrowdStrike Outage Hits Amazon at a Key Moment for Shopper Loyalty

With the CrowdStrike outage having come just one day after the close of Amazon’s blockbuster Prime Day event, the eCommerce giant could see the outage impact deliveries at a critical time on the company’s calendar.

In the wake of the outage, eCommerce retailers have themselves in an unfortunate position. The disruption impacted shipping giants UPS and FedEx, leading them to warn consumers about potential delays, which could impact merchants’ ability to meet their customers’ demand for fast and reliable delivery.

For Amazon’s part, Prime Day deliveries may also be delayed. For instance, a self-described participant in the company’s Seller Fulfilled Prime program, which enables businesses to sell via Prime from their own warehouses, recently took to the official seller discussion board noting that Next Day Delivery orders are facing delays.

“This is something that we cannot foresee and control. Unfortunately, there is no news from Amazon on what things to do with this situation,” the seller stated. “…I hope someone gives us some information about this. This will mess up our metrics and it’s causing us a lot of stress.”

Amazon posted a workaround on Friday (July 19). According to the post, the outage affected both Amazon Elastic Compute Cloud (EC2) instances and Amazon WorkSpaces personal virtual desktops that run on Windows and use the CrowdStrike software. It recommended users fix the issue by allowing the CrowdStrike Falcon Sensor agent to update correctly.

The post also noted that if a user’s device uses what’s called instance store volumes — a type of storage directly attached to the host computer — any data on those volumes will be lost if the device is stopped, put into hibernation or terminated. In such cases, the data is securely erased. For further details, it referred users to the information on Amazon EC2 instance store.

Slower than expected shipping can have a significant impact on shoppers’ satisfaction. The report “Tracking the Digital Payments Takeover: Catching the Coming eCommerce Wave,” a PYMNTS Intelligence and Amazon Web Services (AWS) collaboration, found that 27%  of consumers cited delivery delays as issues they experienced with online purchases.

This spells bad news for Amazon: the outage, which began late Thursday (July 18) came just one day after the close of Amazon’s Prime Day event July 16 and 17. As such, impact on shipping could affect customers’ satisfaction with the eCommerce giant at a time when considerably more shoppers will feel the impact than they would at other times of the year.

During the saving event, Amazon saw surging sales. In a typical day, the company averages about $1.6 billion in sales, per data from its Q1 2024 earnings report  — the most recent period on record — showing that the eCommerce giant brought in $143.3 billion in sales in the three-month span. In contrast, over the Prime Day two-day event, the retailer is estimated to have brought in $14.2 billion in sales — nearly five times the company’s average haul for a two-day period.

These shipping delays are far from the only way that the CrowdStrike outage could be affecting retail merchants. Reports have circulated of the event impacting retailers’ ability to do everything from accepting payments to analyzing sales data to even staying open.

The CrowdStrike outage comes at a particularly inopportune moment for Amazon, right on the heels of its highly anticipated Prime Day. As merchants and consumers alike navigate this turbulence, the incident underscores the fragility of modern digital infrastructures and the far-reaching consequences that technical failures can have on even the most resilient retail giants.