Amazon Prime subscription benefits
Amazon beating Wall Street expectations
Despite strong holiday market showings from some of Amazon’s biggest competitors such as Wal-Mart, Amazon is expecting potentially historic earnings this holiday season. This is great news for Amazon Sellers.
Amazon is projected to beat even Wall Street’s sales expectations for Amazon this holiday season, according to a recent CNBC report.
What are CNBC’s thoughts on Amazon Prime & Whole Foods?
Daniel Ives of GBH Insights said in a research note that he believes Prime customers, those signed up to Amazon’s subscription service, are estimated to spend 20 to 25 percent more this holiday season from last year. This, coupled with growth in the number of U.S. and international Prime members is “setting the stage for a blowout holidays season,” he said.
Earlier reports predicted that Amazon would account for nearly 50% of all online holiday sales this winter, and the report above only heightens the anticipation for what should be a terrific two months in sales for Amazon. Amazon Sellers, in turn, will also sell more.
Prime itself is gradually becoming more popular as Amazon continues to add benefits for its subscribers. The recent purchase of Whole Foods and the introduction of a wider selection to its television streaming service are driving more people to buy Amazon Prime subscriptions.
Speaking of Whole Foods, Amazon is also helping out customers who are planning to shop physically for some of their holiday needs. Amazon lowered prices for Thanksgiving-related grocery products at Whole Foods in anticipation of the Thanksgiving rush to grocery stores. But there was a catch: only people with Amazon Prime subscriptions will be able to reap the benefits of a cheaper shopping experience on these items.
Amazon Prime Members get cheaper prices for Whole Foods
For example, Whole Foods customers, organic turkeys were $3.49/lb, and non-antibiotic turkeys were $2.49/lb. Prime members obtained greater discounts: $2.99/lb for organic turkeys and $1.99/lb for non-antibiotic turkeys. (In the future, Prime membership will act as Whole Foods’ reward program.)
The discounts on turkeys are just one example, but the price difference between those who have Prime and those who don’t is significant. Whole Foods is one of the more expensive national food outlets, but if Amazon can use Prime to drop the p of s on food, it can make customers more enticed to shop there. It will also allow Amazon to remain competitive with other companies who have physical food stores.
Rather than offering discounts to everyone, Amazon funneled and continues to funnel consumers towards Amazon Prime membership.
Amazon Prime subscription – 85 million people have Amazon Prime Accounts
Think of the psychological effect of the “inclusion factor.” According to a recent study conducted by Consumer Intelligence Research Partners, around 85 million people in the country already have Prime memberships. That’s more than a quarter of all Americans. Most shoppers know someone or live with someone who has access to those discounts. People do not like to “miss out” and this feeling will likely continue to drive the growth of Amazon Prime.
Amazon is using Prime to capture Walmart’s market share
Amazon hopes that by branching out the benefits of Prime to capture more subscribers, it can take hold of the people who could drift towards Wal-Mart or other outlets that are becoming stronger competitors for Amazon’s customers. If someone has a paid-for service like Amazon Prime, they’ll likely feel more obligated to utilize its benefits.
The increase in Prime memberships coupled with Amazon’s sales through Whole Foods and its other companies should result in a fruitful holiday season. And if Amazon really is garnering this much traction on its website, that can only mean good things for Amazon Sellers.
Amazon’s biggest Holiday Season online
Either way, it’s pretty evident that Amazon is using both its physical and online stores to get a leg up on its competition in the holiday shopping market. The payoff is expected to be potentially historic for Amazon in 2017.
This article was researched and written by Anders Jorstad. Anders is a content creator Amazon Sellers Lawyer. Anders will be earning his degree in journalism from Hofstra and has five years of professional journalism experience. He has written for numerous online and print publications including SB Nation and The Hofstra Chronicle.