Re:Amazon now requiring Prime membership to buy popular Blu-...
by ocdtrekkie on Monday May 18, 2015 @02:30PM
(#9566063)
I'm sure this is less painful for people who still have the 30-day trial available to them. To everyone else, it's a $99 minimum cost to buy a $10 product.
But it definitely seems like this, combined with the new Prime commercials I've been seeing is a big push to get their regular customers moved over to Amazon Prime.
- Estimated at 40 - 50 million members(1)
- Estimated at $4 - 5 billion in revenue (1)
- That revenue = ~15.5% of Amazon's total revenue, incidentally this is just subscription revenue, not the money spent by the customers on purchases(1)
- Prime is growing 50% year over year (2)
- Prime members spend almost 3x a year vs. average customer (2)
So in that light you have to imagine that:
a) Prime members are dramatically more profitable than the average customer.
b) Acquiring more prime members > some pissed off shoppers that don't want to take a free trial
So in that light it doesn't seem like a huge stretch that Amazon starts packaging Prime with discounts on certain products, especially on razor-thin margin products to push the model.
And of course you also have Jet.com getting huge press for essentially being a "subscription only" ecommerce site.
(1) http://www.pymnts.com/in-depth/2015/prime-turns-amazon-profi...
(2) http://www.geekwire.com/2015/amazon-prime-memberships-grow-5...
(3) http://www.wsj.com/articles/startup-jet-coms-goal-20-billion...