Amazon Prime: Improved Conversions or not?

This analysis about the Amazon Prime member service is really interesting, here are the stats:

Pros:

  • Increase their purchases on Amazon from $400 a year to $900 a year after they join. (source)
  • Spend 130% more than regular Amazon customers. (source)
  • May be responsible for as much as 20% of Amazon's overall sales in the U.S. (source)
  • 82% of Prime members buy on Amazon even if the item is less expensive somewhere else (source)
  • 92% of Prime members plan to renew their membership. (source)

Cons:

  • The Prime promotion grew Amazon’s shipping costs 55% to $4 billion last year, which is well over the $1.55 billion Amazon gets in shipping fees from customers. (source)
  • Amazon spends more than $90 a year for each Prime customer, losing $11 annually for each subscriber. Of the $90, $55 comes from shipping costs and $35 comes from acquiring digital video content. (source)
Source: lukew.com →

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