Retail

The 20 Most Important Things About Amazon Prime

It is almost Prime Day, Amazon’s nearly two-day massive sale, during which people who are members of its Prime subscription service will buy as many as 200 million items. Prime has become the heart of Amazon’s retail business. By some estimates, Prime members buy two and a half times as much inventory, based on dollar amount, at Amazon.com as people who are not members per year. The reason Amazon has a Prime subscriber count of about 150 million is that the service gives consumers a number of advantages. At least 20 of them are good reasons people pay $119 a year.

One key benefit to Prime members is Prime Day itself. The event runs from midnight Pacific Time on Tuesday, October 13 through Wednesday, October 14. Prime members in 19 countries can participate: the United States, United Kingdom, United Arab Emirates, Spain, Singapore, Netherlands, Mexico, Luxembourg, Japan, Italy, Germany, France, China, Canada, Belgium, Austria, Australia, Turkey and Brazil. People who are not Prime members can participate via a free 30-day Prime membership. They add themselves to an army of over 150 million Prime members around the world.

The 20 key reasons people become Prime members:

1. Free two-day delivery for millions of items. This has become a benefit that many retailers, including Walmart, have added. At this point, as people shop across the internet at most large e-commerce sites, delivery, which was once a significant expense, is gone.

2. Free one-day delivery is available on more than 10 million items with no minimum purchase. Amazon has so many delivery hubs and warehouses that this is logistically possible. Few retailers have any way to match it.

3. Free same-day delivery is available on over 3 million items on qualifying orders over $35. Order in the morning, typically before noon, and get items by 9 p.m. This has become a key benefit, particularly in highly populated areas, where Amazon can locate warehouses that are close to large numbers of people.

4. Free fast grocery delivery allows two-hour delivery on groceries, including quality fresh food and produce in some cities. Once again, Amazon can offer this because of its sophisticated delivery operations and many delivery hubs and warehouses. This business has gotten more competition for large grocery companies, including Walmart and Kroger. Grubhub has allowed smaller food stores to be competitive.

5. Free release-date delivery allows Prime members to be among the first to get new video games, books, music and movies. A special delivery function allows these items to be ordered and received by 7 p.m. on the same day.

6. Free no-rush shipping. Prime members who use no-rush shipping save Amazon money because they do not tax the logistics operation with items that must be delivered immediately. In turn, they earn rewards for future purchases.

7. Prime Video streams thousands of movies and TV shows, including exclusive Amazon Originals. Amazon competes in this business with large well-funded companies led by Netflix and Disney. Amazon Originals are programs paid for and produced by Amazon. This has become an investment in the hundreds of millions of dollars each year, meant to help retain Prime members.

8. Prime Video channels range from $4.99 to $14.99 a month. It allows people to watch shows and movies from HBO, Showtime and Starz channels for a fee over their Prime payment. It is part of the American trend to have “unbundled” access to content without a cable service. Members can cancel anytime, which is not the case with all cable services.