SMS 171 – Amazon Prime

Amazon Prime

Amazon prime is a membership service that for most people provides expedited shipping, but there are some additional benefits that are commonly known and even more benefits not so commonly known.

The cost of Prime is $7.99/month which includes one free month for new members or $79.00/year which works out to $6.58 on a monthly basis.

More importantly is Prime a good idea from a behavioral economics standpoint?

Prime commonly know benefits:

  1. Free same day shipping (32 cities & towns across Canada)
  2. Free 2 day shipping – no minimum dollar amount
  3. Prime Video – downloadable
  4. Prime Music – ad free, downloadable
  5. Prime Reading – kindle

Prime not so commonly known benefits:

  1. Early access to lightning deals
  2. Amazon Photo storage – 5GB
  3. Prime Days – like black Friday
  4. Prime Channels (live & on-demand) – STARZ, Hayu, MGM
  5. Amazon family subscriptions – save up to 20% on diapers and baby food
  6. Three months free Audible membership
  7. Twitch Prime – includes bonus games & exclusive in-game content

The problem with Prime:

  1. The video service is not very good
  2. The music app is not great
  3. Promotes consumerism
  4. You have pre-paid your shipping costs
  5. Reduced transaction friction

When does Prime make sense:

  1. Consumable products
  2. Products you can only get on Amazon
  3. Utilized with a large family
  4. Use of video and music services exclusively
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