Dive Brief:
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Although Amazon itself as never revealed its Prime membership numbers, market research company Consumer Intelligence Research Partners estimates that some 40 million U.S. consumers belong to the internet retail giant’s loyalty program.
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That would be 45% of Amazon’s U.S. customers. For $99 a year, Prime members enjoy several perks, notably free two-day shipping on many items and access to its entertainment screen and music streaming services.
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Amazon’s Prime members are significant to its business. They spend $1,500 annually on average, 140% more than nonmembers and up 25% from last year.
Dive Insight:
Amazon keeps numbers about its Prime membership close to its vest, but this estimate by Consumer Intelligence Research Partners has been deemed “reasonable,” according to reporting by Internet Retailer. Prime membership got a big boost at the holidays — no surprise considering that the e-commerce retailer was offering a free trial. The research also found that 39% of Amazon customers are Kindle owners, who similarly spend some $1,450 each year compared to those without. There aren’t significant numbers of customers that own Fire phones or Fire TV boxes or sticks.
Amazon has just announced that it's making it easier for non-Prime members to get free shipping on their orders. But it’s quite clear that Prime and even Kindle are two highly effective ways, beyond its notoriously low prices, that Amazon captures and keeps customers.