Why Did Amazon Cut Kindle Prices by 25%


Mother’s Day is next Sunday, May 8th, and Inc. (NASDAQ: AMZN) is offering a 6-inch Kindle e-reader with a glare-free touchscreen display and WiFi connectivity for $59.99, a discount of 25% from the regular price, just in time for you to do something nice for your mom.

The discount is available with devices that display Amazon’s Special Offers, product promotions that are displayed when the Kindle is in sleep mode. Without the Special Offer option the device costs $79.99.

Amazon has sold millions of Kindles since first introducing the device nearly 10 years ago. But sales have been declining for the past five years. To beef up sales the company just released its  latest version of the device, the Kindle Oasis, which sells for a tidy $290.

Whether a Kindle costs $60 or $290 the device does essentially the same thing: allow users to download and read digital copies of books. Amazon also sells digital books, and far more of them than it sells Kindles.

According to research by Slice Intelligence, a Kindle owner spent $226 on e-books last year while spending on physical books averaged just $99. It’s the old razor/razor blade model that’s been proven time and again provided that the blades deliver value.

Another reason Amazon wants to promote its entry level Kindles is that sales of new Kindles are heavily weighted toward repeat buyers. Slice Intelligence data indicates that 41% of Kindle purchases in the past six months were made to customers who already owned one. Nearly three-quarters of those sales were made to buyers of the company’s more expensive Paperwhite models that list for $119.

In other words, people like the Kindle and they’re voting with their wallets. Offering a special price in time for Mother’s Day also makes demographic sense because women read more than men.

A report from Pew Research last October showed that 77% of women read at least one book in the past 12 months while just 67% of men did. But e-book readership was much less divided, with 29% of women having read at least one e-book compared with 25% of men. Women also read more books, a median of 5 to the men’s median of 3, and a mean of 14 to the men’s mean of just 9.

Take a look at Amazon’s Devices page for Kindle. All three images promoting the Kindle include women. Not a guy in sight.

Happy Mother’s Day.

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