AuctionBytes Blog
Covering auctions, collectibles and marketplace selling.

AuctionBytes Blog The AuctionBytes Blog has been giving a voice to online merchants since its launch in 2005. Named one of the world's top 30 blogs in 2008 by "Blogging Heroes." Weigh in with your thoughts on the joys and pitfalls of selling online.
Thu Apr 26 2018 23:05:37

Amazon Raises Annual Prime Membership Fee to $119

By: Ina Steiner

Sponsored Link

Amazon is raising the cost of an annual Prime membership in the US from $99 to $119 effective May 11th for new members and beginning June 16th for renewals. The company announced the fee change in a call with analysts to discuss its first-quarter financial results.

Amazon started out the year with remarkable growth. In the first three months, its North American net sales rose 46% compared to the first quarter of 2017. That's nearly double the growth rate it saw in North America in the first quarter of 2017.

International net sales, which were half that of North American sales, rose 34% - compare that to the 16% growth it saw in the first quarter of 2017. 

Third-party sellers are a beneficiary of Amazon's strong quarter. Worldwide paid units grew 38%, and sellers comprised 52% of unit sales.

When asked about the accelerated revenue growth seen in North America for the quarter, Amazon Chief Financial Officer Brian Olsavsky said the general driver continued to be Prime and the Prime flywheel. Amazon sees better engagement among Prime users especially for digital benefits, and "that's always good news for eventual sales of other things."

He also said Amazon is selling premium Prime services such as subscriptions to Music and Kindle Unlimited programs. 

But Olsavsky also noted the cost of Prime. "We continue to increase the value of Prime including speed, selection, and digital entertainment options. The value of Prime to customers has never been greater. And the cost is also high, especially with shipping options and digital benefits. We continue to see a rise in costs."

He also noted that Amazon Prime saw a single increase in March of 2014. "Four years ago when we last increased the cost of Prime, you could get 20 million products within 2-days. Today you can get over 100 million products within 2 days and many, many, many products within 1 day, same-day, or 2 hours," he said.

"We continually added new features, it's a different program than in 2014."

The CFO said Prime was still "the best deal in retail" and said Amazon works to make it better and better each day.

Many shoppers have come to rely on the marketplace. When Amazon recently cracked down on buyers, many were frantic, describing how much they depended on being able to get goods online.

Among the reactions to the fee increase from customers on Twitter: "I'm good with the $119 I suppose but I miss when 2 day delivery actually meant 2 day delivery. I've had prime long enough to remember when they delivered on Sundays." Another customer responded, "I hear you. It's irritating when Amazon lists an item as Prime, & then when checking out, it'll show shipping time as taking 5-7 days. WTH list it as a Prime item?"

Comments (23) | Leave Comment | Permalink
Readers Comments

Perminate Link for Amazon Raises Annual Prime Membership Fee to $119   Amazon Raises Annual Prime Membership Fee to $119

by: Chicago48 This user has validated their user name.

Mon Apr 30 05:49:15 2018

"I hear you. It's irritating when Amazon lists an item as Prime, & then when checking out, it'll show shipping time as taking 5-7 days. WTH list it as a Prime item?"
@Iheartsparrow:  I'm a prime member too and $10 more is not a whole lot of money....but I resent that AMZ places emphasis on shipping fast when it takes longer than 2 days to get a package.  There is no guaranteed shipping, even Fedex and UPS can't guarantee shipping. Stuff happens - like Weather and labor issues.  Because I am academic I get 1/2 off and use the videos for free viewing in classroom.  Whether I get a package in 2 days doesn't thrill me.  I mean - if I wanted a package quickly I would ship it overnite Fedex.

Perminate Link for Amazon Raises Annual Prime Membership Fee to $119   Amazon Raises Annual Prime Membership Fee to $119

by: felyne This user has validated their user name.

Mon Apr 30 06:49:18 2018

Pretty soon fees/shipping will get so high, stores like Toys R Us will make a comeback. 😉

Perminate Link for Amazon Raises Annual Prime Membership Fee to $119   Amazon Raises Annual Prime Membership Fee to $119

by: treasureattic This user has validated their user name.

Mon Apr 30 10:02:20 2018

As a 3rd-party Amazon FBA seller, I'm happy to see comments (at least on here) that people are still going to keep their Prime accounts.  

Click to view more comments
1 2 


Login is required to post comments.
To sign in to leave a comment, fill in the form below. If you have not yet signed up for AB Verify, or if you'd like more information, go to the Registration Page
.

Login for AB Verify
Be sure and use your email address and password to log in.

 
Email:
Password:
 
 Forgot Your Password?
 Even though you are signed in with the AuctionBytes Blog, you will have to sign in to the EcommerceBytes blog. But you can sign in with your existing AB Verify info.