Amazon is Raising the Price of Prime Monthly Memberships by Nearly 20 Percent (recode.net)

Amazon is boosting the price of its monthly Prime membership fees for new and existing members by nearly 20%. The online retailer said Friday its annual membership fee of $99 will not change. From a report: The increase comes less than two years after Amazon first introduced the monthly payment option as a way to attract new Prime members who either couldn't afford the annual membership of $99, which is not increasing, or didn't want to commit to using the service continuously. Prime is the engine at the center of the Amazon commerce machine -- Prime members buy from Amazon more frequently than non-Prime members and also spend more, hence why Amazon introduced the monthly option to lure new members. So if the company is raising the fee, you can bet that it discovered the current $10.99 was just not sustainable.

Comments

Not sustainable?

[Anonymous Coward]

Or they just like money... Is that possibility really too crazy to consider?

Re:Not sustainable?

[Espectr0]

of course it's sustainable, otherwise they would have raised the $99 yearly fee. The price hike is just to make some people to switch to the full year price, thinking they will get the better deal. It will work for some, and savvy people will only subscribe for november (black friday) and july (prime day)

Re:Not sustainable?

[Kenja]

What seems to have been happening, is that people would order a pile of stuff and find that paying for one month of Prime cost less than shipping. So they would sign up and then cancel.

Re:Not sustainable?

[Anonymous Coward]

Back when I was on a free trial of Prime, I switched all of my preorders to the free two-day shipping option. After the free trial was up, all of my preorders (some of which would not ship for several months) retained the free two-day shipping. So yeah, I can totally see people signing up for a month of prime in order to place a bunch of orders.

Re:Not sustainable?

[gnick]

...savvy people will only subscribe for november (black friday) and july (prime day)

Or they'll keep piggy backing off someone else's subscription. I can't stream Prime video, but I get free 2-day shipping thanks to a family member who pays yearly. I can't be alone in this.

Re:Not sustainable?

[obenchainr]

As soon as I read the post, I assumed this was what was happening. Especially for something larger, the shipping will likely be more than $10, so signing up for Prime to get, say, a lawn mower or something big delivered (especially around the holidays) and then cancelling again would be a fiscally smart way to (ab)use the system.

Re:Not sustainable?

[atrex]

They probably got annoyed at people signing up for the monthly prime service in November/December, then canceling in late December/January.

Re:Not sustainable?

[PhrostyMcByte]

It seems more to prevent people from paying $10 and binge-watching all of Amazon's exclusives in a single month.

Re:Not sustainable?

[unrtst]

THIS. Or, at the very least, this is probably part of the decision making process. I doubt there's any one issue.

* greed/wanting more money... this doesn't make sense as a reason, because it relies on the chance that people will still get the monthly sub, which is more expensive than the yearly sub.

* seasonal shipping.. this is probably part of the reason.

* binge watching amazon exclusives (or other vids)... prime video alone, IMO, isn't worth the full prime price. If someone isn't reaping many of the other benefits, then a periodic binge on a one month sub is the only way it'd make sense.... and then, who cares if it's a few bucks more?

* possibly a buffer in prep for the lack of Net Neutrality... if they need to start shelling out cash for fast lanes to ISP's, that has to come from somewhere

If they had had a monthly option when I signed up, and it was close to the same price, I would have gone monthly only when needed/wanted.

Re:Not sustainable?

[MightyYar]

Why do you say this? My wife and I have two totally separate Amazon accounts that share a Prime membership. I cannot see her purchases or viewing history.

Re:Not sustainable?

[ryanmc1]

The previously mentioned sharing is legal, the sharing you are talking about is not.

Re:Not sustainable?

[MightyYar]

We definitely can share Prime Video in the US.

The new price

[EvilSS]

The new price is $12.99/month if anyone was wondering.

Re:The new price

[cayenne8]

It wasn't worth it at the old price. Their streaming service is substandard and the "free" shipping is just added on to the price of the item.

I find for the small sum of $99/yr, it is VERY much worth it to me.

I like the 2x day shipping, and I do most of my shopping there online, rather than brick and mortar.

I really have been using Amazon Music to stream in my car lately.

I like the free eBooks I get monthly for reading.

I believe there is also free online storage you get for photos and something called Twitch.tv too, but I"ve not explored those yet.

I do shop around online for best prices, but most of the time, I find it at Amazon, and I have just enough patience for most things to get here in 2x days.

Their video streaming content is getting better, I have both it and Netflix....Netflix seems to have less and less and Amazon seems to be starting to have more and more movies I want to watch these days.

Again....$99 a year is nothing, as I mentioned elsewhere, I've had bar tabs that high, so for all that entertainment AND "free" 2x day shipping, it is more than worth it to me.

Re:The new price

[Anonymous Coward]

WalMart is becoming competitive with them (fewer shipping problems and better packaged for shipping) AND they have brick and mortar stores which Amazon barely has.

Re:The new price

[Anonymous Coward]

The difference is that with Amazon I don't have to shop at Walmart.

Not saying Amazon's warehouse workers are treated amazingly well, but they are a shade better than Walmart deliberately helping their workers go on public assistance. Seeing as I already have to pay Walmart's workers out of my tax dollars, I'm not going to give them another dime.

Oh, and when I buy a product on Amazon, I'm more or less guaranteed the actual product, not the "Walmart version" of the product, which is typically made on the cheap using inferior components. I used to work with Walmarts supply chain and quality control arms at a previous job, they strong arm companies into meeting price points. In order to do this those companies typically just make a new SKU of garbage quality to sell at Walmart.

  And it's delivered to my door. If I have to drive out to the store to pick up my purchase I've kind of defeated the entire reason I had it delivered in the first place.

So no, Walmart.com is NOT coming on strong. At least not if you can afford to shop anywhere else. If you can't afford to shop elsewhere, that's another story-- though I do feel bad that people shopping there end up with garbage products. Unfortunately you get what you pay for.

Re:The new price

[jowaju]

Yes there is, simply contact them and get an additional month of prime for free, I do it every time I have a late package, which is admittedly almost never. "Note: If you received free shipping with a guaranteed delivery date through Amazon Prime, you may be eligible for a free one-month extension if the delivery date isn't met. Prime extensions are limited to one per free trial, one per month for monthly members, and 12 for an annual membership."

Re:The new price

[cayenne8]

I almost hate to say this, but walmart.com is coming on strong on a lot of common, and not so common items, it is price competitive with amazon, especially if you do the ship-to-store option

But UGH the thought of actually having to go to, park and go inside a Walmart....I just can't stand going into that place.

I rarely go to a Wally-world...usually only to get a really good deal on ammo (bird shot 100 packs for $19.99), and at times, oil or washing/waxing products for the car. But other than that, just can't stand the place and the food, ugh...their meat still has marks where the jockey was hitting it.

And well, amazon still has a LOT of 3rd party sellers, and from them, no sales tax is charged, which makes that still an attractive option.

Wally-world also needs to get their website looking and operating in a bit better, user friendly manner.

If Wally-world can match or beat the Amazon price, and do shipping in same 2 day manner and have the selection and not force me to go to a store, I'll give them heavy consideration.

Long-term lock-in

[Anonymous Coward]

Sustainable my ass. Now that they've got people hooked Amazon wants to make sure they don't leave again and lock them in for a full year.

Bonus side effect: they get to charge people who cannot afford a lump sum of 100$ more. Being poor is expensive.

Re:Long-term lock-in

[Anonymous Coward]

I don't think you understand just how slim some people's margins are. Something might come up one month that requires that $10 you were going to put into Prime (and $10 from groceries, and $10 from something else, and $10 from something else, and..).

If you still want to argue that Prime is a luxury not an entitlement, by all means go ahead. But at least try to argue sensibly.

Re:Long-term lock-in

[Tablizer]

Oligopolies and near monopolies almost always suck in the longer term. Without competition, Amazon will gradually grow dickier and dickier.

What if..

[Anonymous Coward]

..they discovered that people would sign up for a month then cancel once they got the high shipping cost item they wanted? Then do it again 2 or 3 times a year? I know people who do exactly this. Same with `flix and `lu. It makes sense to raise the price to cover the people who do that. And being they are not raising the yearly cost, the $99 is profitable, but 10.99 3x/yr is not.

Re:What if..

[aardvarkjoe]

Same with `flix and `lu.

Does "Hulu" really need a 3-character abbreviation, 'onymous 'ward?

Free Market at Work

[gti_guy]

No one is forcing you to use Prime. What is this even a story?

Re:Free Market at Work

[thegarbz]

No one forces you to do most things. That doesn't mean it isn't of interest to people.

News only about things you're being forced to do is called government propaganda.

Re:Why does anyone need prime?

[cayenne8]

I cant figure that part out.

My packages will get here when they get here.

And usually they arrive much sooner than the estimate.

I will never pay for Prime.

I find a lot of value in it.

I do a LOT of shopping on Amazon, I rarely go to brick and mortar stores, and I like the 2x day shipping. I have patience for 2 days.

I like the options I find on Amazon Prime that comes with it.

I like that I get free eBooks monthly.

You get some free storage on amazon cloud.

I enjoy the Amazon Music, I use that to stream in my car off my cell phone.

There's other stuff I've not tried yet, something called Twitch.tv you get free.

I believe there are some other things, but I find these all to be a big value to me....

Here are some links here and here....

And all that for a mere $99/yr?

Hell, I've had single night bar tabs that much....

At least they waited until after the holiday

[rjejr]

They probably should have done this in mid October before everyone signed up for 1 month for Black Friday shopping and last minute Christmas shopping. The fact that they waited until mid-January at least is a good reminder for everyone who signed up monthly to cancel now that they are done shopping. And it does look like they are giving a 1 month notice, my monthly renewal date is February 5 but they said I won't be charged the extra $2, $12.99, until March 5th, so they are giving people and extra month at the current price it looks like. Nobody likes to pay money, but I think it's a good move by them. We were signing up about every 3 ro 4 months just to save $12 on $60 video game and get it day 1. We were also getting a free month every year, from 3 different people in our house with Amazon accounts, so we probably only paid 1 or 2 months out of the year. Sorry if we ruined it for anybody,w e just did what they let us do. They could have dropped monthly entirely, forced everyone to pay $99, but at least people will still have the option to pay $13 in July for Prime day or next November for Black Friday shopping. It could have been worse. I have no relationship with Amazon except as a customer, and I'll be dropping Prime next month.

Unreasonable conclusion.

[plague911]

"So if the company is raising the fee, you can bet that it discovered the current $10.99 was just not sustainable."

Talk about jumping to conclusions. There are a myriad of reasons why the company could be choosing to raise its price and dozens of factors at play. Yet the author picked one, because "reasons." There likely is a analysis out there 100 pages thick about the implications of rising the price yet you think the answer is of-course a one word statement of "sustainability."

Re:Makes sense

[thegreatbob]

Turn of fancy punctuation, and people won't call you out as an Apple user here. It likely looks fine to you and other mobile users, but your quotes (and anything else you can't type directly on a normal desktop keyboard) devolve into weird accented a's, TM symbols, and other madness on normal platforms. http://appleinsider.com/articl...

Not in CANADA

[Roger W Moore]

Try that on amazon.ca and let me know how it works. The only thing they have in Canada is "Amazon Family" which gives you 20% off diapers so in Canada their Prime offering is literally shit.