Convinced She’s Write

Amazon Prime

February 5th, 2005

Jeff Bezos lists a new marketing concept on Amazon’s homepage this evening: Amazon Prime. Amazon Prime lets you pay a flat yearly fee of $79 to then get free two day shipping, and $3.99 overnight shipping. If you’re a gotta-have-it-now kind of person, this might be worth considering. $79 can readily be covered over the year, particularly since you can share the benefit with other family members. But this, to me, just highlights how much we’re willing to pay to have something _NOW_. This says some folks think gotta-have-it-now is worth at least $80 per year. Just like it bothers me to pay ATM fees, which are essentially fees for gotta-have-it-now money, it bothers me to pay shipping fees, unless the shipping fee + the cost of my items is significantly less than what I can get the item for locally - not a usual occurrence. My usual gameplan is to order whatever it is I need to order, and then fill in my order, if necessary, with wishlist items or Christmas gift items that I can tuck away for the future. That usually gets me to the dollar minimum for free shipping. That free shipping is slower than the overnight stuff, but hey, it’s free. I can use that shipping fee to go buy something else that I’d like, but isn’t a gotta-have-it-now.

I’m thinking $79 is a pretty high price point. I wonder if they’d have more success if they did it for a shorter time period - say $35 for three months. Then, you could subscribe if you knew you were going to be doing a bunch of ordering over that time period. Of course, then they’d get a bunch of revenue from this right around Christmas and see nothing the rest of the year.

This, of course, doesn’t apply for their various third-party areas. So, if you often buy used books, for instance, this just wouldn’t apply. And there are other various quirks to the program, including ways that Amazon can opt out of it for certain products. All in all, though, still an interesting idea.

Entry Filed under: BizExecToBe