Prime Seen As Amazon.com, Inc. (NASDAQ:AMZN)’s Future


Amazon.com, Inc. (NASDAQ:AMZN) recently broke down the pricing of its Amazon Prime program in a way that lowered the barriers to entry. The company originally offered Prime as an annual subscription, but customers can now sign up for monthly packages. The company also came up with a standalone Prime Video package that is priced monthly.

Through Prime program, Amazon.com, Inc. (NASDAQ:AMZN) has been able to create a strong base of highly loyal customers. For example, when it comes to online shopping, nearly all Prime members shop at Amazon exclusively.

Amazon Prime tiers

Prime Video at $8.99 a month

The standalone Prime Video services costs $8.99 a month and gives subscribers access to unlimited movies and TV shows. Video is one of the popular offerings under Prime and that explains why Amazon.com, Inc. (NASDAQ:AMZN) is busy building its video business through a combination of original shows and size of the catalog.

Prime monthly $10.99

Amazon’s Prime monthly package costs $10.99 and gives subscribers access to all the services available under the legacy annual plan. Those services include the ability to save up to 25% on your shopping with prepayment discount, access over a million ebooks, free two-day shipping and free same-day delivery in eligible areas.

Prime annually

Amazon kept the original Prime plan at $99 and the price is equivalent to $8.25 per month. That means that those who sign up for Prime annually make some savings over the monthly package.

Prime membership count

Amazon.com, Inc. (NASDAQ:AMZN) doesn’t disclose the exact number of its Prime members. But third-party surveys believe that global Prime membership is currently in the vicinity of 80 million. The U.S. is the largest Prime market with more than 64 million of Prime members coming from the U.S. alone.

Sales drivers

Prime members are the sales drivers on Amazon.com, Inc. (NASDAQ:AMZN)’s retail site. A recent survey by Cowen showed that at least 53% of all the sales on Amazon come from Prime subscribers.

Free delivery is the selling point

As to what is getting people to sign up for Prime membership, it is said that about 80% of Prime members got into the program because of the free delivery service.

Neha Gupta

Neha Gupta has been in the financial space for over six years now. Gupta earned her MBA degree from Symbiosis Centre of Distance Learning in 2009 and her passion for finance led her to pursue Chartered Financial Analyst (CFA) course. She has successfully completed Level II of her CFA. She is a veteran in article writing, which is depicted in her numerous pieces published on SeekingAlpha, Nextiphonenews, InsiderMonkey, MarketWatch, and Techinsider. Her crisp and eloquent writing finds its best place in Researchcows, where emphasis is given on developing rich content for various websites, products, business plans, trainings, and book writing.

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