Monday, 25 Jan 2021

Amazon Prime Shows Loyalty to customers that are on $99 annual plan


Amazon used a different approach this time to show loyalty to existing annual paying members. But also decided to make this decision a profitable one as they always do.

Amazon announced on Friday announced that it has raised the monthly Amazon Prime membership rate from $10.99 per month to $12.99 per month, an increase of 18%. Amazon was quick to note, however, that the $99 annual membership fee for Amazon Prime will remain the same. Students who were paying $5.49 per month for access to Prime will now be charged $6.49.

Amazon launched the monthly membership back in 2016 and has been testing it in the market. Launch details can be found in here. Seems like Amazon grew significantly the monthly membership customer base.

According to this price increase Amazon will be collecting $156 from a monthly membership over 12 months period.

Looks like Amazon researched their customers to understand the value perceived and how much the customers are willing to pay for the service.

Seeing a price increase after a year from launch is no surprise. Amazon prime value very high for all the reasons we know from free shipping, delivery to your home or for all the digital access we get for becoming prime members.

Increasing the price is also a relative decision, it has to be studied. It has to reflect a value behind that price increase which Amazon for sure has showed to their members.

This decision will not only help their bottom line but will also help Amazon show more loyalty to their members who continue to pay on the annual membership because they kept the price at $99 a year.

Loyalty can be displayed through various ways but Amazon shows that through the value, great customer service and also pricing strategy they put in place.

Loyalty Guy

Our leader is an international loyalty expert who has worked in loyalty and retention for 15 years. He has designed over 5 loyalty programs from scratch, revamped 3 loyalty programs and launched several programs for fortune 500 companies to help them increase retention and loyalty of their customers. His experience is well diversified across several industries which makes him unique in the knowledge he can share with everyone around.

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