With over $800 billion market cap, Amazon.com Inc. (NASDAQ:AMZN) is one of the biggest companies in the world right now. The vast array of its ventures and their respective successes have made its CEO, Jeff Bezos, the richest man in the world, and top donor as well. However, an important part of its success has been the Prime initiative. With the number of Amazon Prime members increasing consistently over a long period of time, let us analyse the effect of the membership in the present day scenario.
The Amazon Prime membership
Amazon has been able to provide its customers with a juicy proposition through the means of the prime membership. In April last year, Jeff Bezos revealed that Amazon Prime is growing at a phenomenal pace as the total number of Prime subscribers has crossed 100 million mark, globally. However, Amazon refrained from revealing the latest figures since then in any of its filings.
The Prime membership entails them to an array of services – from groceries and apparel to the pantry. It has even made new forms of media consumption possible with the introduction of books and video games. This adds to the already successful OTT venture of Amazon, Prime Video.
The mere fact that Amazon has been able to provide these many services under one membership is something most of the companies find too much to hold on their plate. It signifies Amazon’s diversity in business, also underlining the success achieved in each and every venture. This can simply be attributed to the fact that such services can’t be provided under any other single venture.
Therefore, it isn’t surprising to consider the fact that about half of the households of the USA have an Amazon Prime membership. In fact, according to e-marketer, by the end of 2019, 51.9% of US households will be having an Amazon Prime membership. That is going to take the number of Amazon Prime members in the US up to 63.9 million. Considering the manner in which the company markets its membership plans, it is easy to see why it is that big a success.
Just to put things in context, the arch-rival of Amazon in streaming space, Netflix already has 60.55 million users in the US now. However, the number of Amazon Prime members in the US includes the members who have subscribed for fast delivery and other benefits like shopping discounts at Whole Food. To have a tete-a-tete comparison, Netflix must be compared with Prime Video.
The discount plans
Amazon has been able to attract a sizeable number of the population in the US with its Prime offering. However, it also has discount propositions to make the Prime membership even more attractive. The biggest example of this is the Amazon Household initiative. It allows the linking up of up to two adult accounts, 4 children accounts (under the age 12) and two teenager accounts (in between age 12 and 17). This will allow the elders a degree of control on the consumption of media, along with added discounts on products like diapers and baby food.
It has also targeted plans for the student community. In May 2018, Amazon increased the yearly subscription price of its Prime membership in the US to $119. However, the company has continued a specific student membership plan which makes the services of Prime available annually at $59. It also has a $5.99/month fee for those on government assistance.
Amazon is trying as hard as it can to promote Prime to every section of the society possible. Its strong presence in US households is a great example of the same. It is even making home deliveries all that efficient with the development of drones. Bezos’ recent claim, to make same-day delivery of Robert Mueller’s official report, free of charge, to every American household is a great exhibition of the power at the hands of the richest man in the world.