Surely no one knows how many consumers are members of Amazon.com's (NASDAQ:AMZN) Prime loyalty program. The company broke its long silence in early 2018 to say global subscriber numbers had topped 100 million, but that was the last official data Amazon released about Prime memberships.
While Amazon has not provided any updates, an estimated 105 million, or 82% of the 127 million households in the U.S., currently have an Amazon Prime account, according to market research firm Consumer Intelligence Research Partners (CIRP).
With Black Friday and the ensuing holiday shopping season kicking off in just a week, many supporters are asking themselves, "Should I finally sign up for Amazon Prime?"
Free One-Day Shipping and More
The big draw for many consumers is expedited shipping -- Amazon recently increased its delivery speeds. After years of offering two-day or faster shipping, Prime customers can now get millions of items in as little as one day. This can be a huge inducement for customers who want to avoid the pain of Black Friday bargain hunting and the crowds of big box stores and shopping malls.
Expedited shipping is the most well-known benefit of Prime membership, but there's more. In an era where streaming video is increasingly the norm rather than the exception, Prime members gain access to a growing library of award-winning Amazon Originals, a back catalog of popular older movies and TV shows, and a slate of live events — all included with membership. The platform also makes it easy to sign up for more than 100 partner channels, including Showtime and AT&T's HBO and Cinemax, as well as niche favorites like IFC, AMC Network's Shudder, and Britbox - and watch them all in one place.
For music lovers, Amazon offers Prime Music, which provides unlimited, ad-free access to over 2 million popular songs and hundreds of Prime playlists. Members can also enjoy discounts on Amazon Music Unlimited, which offers more than 50 million songs for serious audiophiles for $7.99 per month for Prime subscribers, a 20% discount off the normal price.
Amazon also provides benefits to gaming enthusiasts through Twitch, the world's leading live streaming platform for gamers. Twitch.TV users who link their Amazon Prime accounts receive a free monthly Twitch channel subscription and exclusive access to free gaming content. Members also get exclusive discounts on pre-order games.
Then came Amazon Prime Day. Dubbed the company's "Black Friday in July," the Customer Appreciation Day promotion will be extended to 48 hours this year, offering the company's best deals of the year, with a rotating list of discounted items and new products on sale every hour.
Holiday Monopoly
While daily deals offer a big lure for customers to join Prime, holiday deals may provide the biggest incentive. Amazon will be offering deals and discounts for more than a week when the holiday shopping season officially kicks off with Black Friday, which kicks off on Friday, November 22. The company will be offering a laundry list of its most popular items at discounted prices, including the Fire 7 tablet for $29 (40% off), the Echo Show 8 for $50, which is $99, and the Echo Dot for $35, which is 30% off its retail price.
The tech giant is also offering deep discounts on a laundry list of TVs, smartphones, electronics, toys and games, apparel, and more, too many deals to list here, with savings ranging from 15% to 60%.
Why trade at all?
All retailers offer great deals during the holidays, so why does Amazon offer so many other deals to Prime subscribers? The answer is simple economics. Once they commit to an annual membership fee, Prime customers want to get the most for their money, spending an average of $1,400 per year, more than double the $600 spent by non-members, according to CIRP data from earlier this year.
Subscriber renewal rates also improve over time. 64% of trial members convert to paid members, 93% renew their memberships after the first year, and 98% continue to subscribe after two years.
But what about Black Friday alone?
The 30-day free trial is the biggest draw for holiday shoppers to Amazon Prime. Customers can sign up, take advantage of all the holiday deals (with just one tap), and cancel within a month if they're not satisfied.
To get the deal, Amazon customers will need to pay $119 per year or $12.99 per month, so given the myriad benefits that come with membership, it's easy to see why consumers are flocking to it.
By signing up for a free trial, consumers truly have nothing to lose and can save a lot as well. Who knows? Once a customer signs up for a vacation and sees how easy it is to avoid traffic and crowded stores, you might stick with it like I did.
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