Yesterday, at Amazon’s annual shareholder meeting, Jeff Bezos again reached out to Amazon shoppers and accountholders, urging membership in Amazon Prime.
“Our goal with Amazon Prime, make no mistake, is to make sure that if you are not a Prime member, you are being irresponsible.”
He means financially, of course.
— Kai Baumgartner (@kaibaumgartner) April 6, 2016
Sweetening The Pot
And indeed there are many perks to becoming a Prime member, and Jeff Bezos is quick to point them out.
Originally, for $99 a year, members got free two-day shipping on millions of items, no matter the cost. Non-prime members pay shipping costs on any purchase less than $35.
Adding incentives to join has been a gradual roll-out, but now include a host of other perks:
- Members can stream movies, TV shows, and music and download free Kindle books
- Students with a .edu address get a six-month free membership and then a 50 percent discount on regular membership
- Moms get a three-month free trial, a 20 percent permanent discount on diapers, and access to other discounts.
- Prime memberships can be shared with family members living in the same household
And More Is In The Works
There are more perks still to come, according to Tech Crunch, who contacted Amazon for more detail. It seems that Amazon Prime members could soon have access to private label groceries and a host of other household items at highly competitive prices, all at free shipping cost.
It appears that Jeff Bezos has plans to be the main competitor with current grocery store delivery services.
Prime Membership Promotes Loyalty
Of course, there is profit to be had by Amazon for continuing to add benefits to its Prime membership. When consumers join and pay that fee, they will shop on Amazon as much as possible, to get that free shipping of course, along with the other discounted pricing and member benefits that come with that membership.
Having a loyal customer base that comes to Amazon first, shops more and spends more, means higher revenues and happier shareholders.
Jeff Bezos didn’t only make his comments about responsibility at the shareholder’s meeting on Tuesday. In a previous annual letter to those same shareholders, he stated the following.
“We want Prime to be such a good value, you’d be irresponsible not to be a member…Prime has become an all-you-can-eat, physical-digital hybrid that members love…there’s a good chance you’re already one of them, but if you’re not – please be responsible – join Prime.”
— CNET (@CNET) May 18, 2016
Amazon is also moving into the brick-and-mortar sector. Its first physical bookstore opened in Seattle last year, and it looks like the next one is planned for San Diego.
While Jeff Bezos has not provided a lot of detail about how many physical stores will open, he does insist that Amazon has no interest in developing a chain, like Barnes & Noble and the former Borders, as a Wall Street Journal article previously reported.
With such a huge online shopping community, some are wondering what the point of brick-and-mortar stores is for Amazon.
Capturing physical retail shoppers adds another base to Amazon’s consumer community, of course, but there may be other motives. Amazon can gather data on shopping behavior and promote its online shopping experience with that base.
Hard to tell. After becoming the most disruptive factor in retail shopping of the 21st century, it is difficult to predict what Amazon will come up with next. We do know that it is expanding its warehouse reach so that delivery can even be reduced to one-day in many locations, and so that perishable food items can be offered.
Last year, the TV program 60 Minutes did a segment on drones, and Amazon was a featured part of that segment, discussing drone deliveries of its products. Maybe Amazon will disrupt more than retail shopping. UPS and FedEx may need to take notice too.
[Photo by Chip Somodevilla/Getty Images]