The cost of enjoying free shipping on Amazon is going up.
The e-commerce giant, which relies on its Prime memberships to lure in shoppers with the promise of free, fast shipping and a host of other benefits, will be raising the price on its monthly fee, according to Recode.
In addition to its annual $99 membership, Amazon also offers a monthly option for those unable to pay the whole amount at once. The rate had been $10.99 in the U.S. but that’s going up to $12.99. The 18 percent increase totals $156 a year.
Students will also have to dig deeper in their pockets to continue their memberships. Those rates are reportedly going from $5.49 to $6.49 a month.
“Amazon Prime is basically the best in class example of a retailer loyalty program. It’s remarkable to see how prime members spend almost double what a non-Prime Amazon shopper spends on Amazon.com,” said Jack O’Leary, an analyst at PlanetRetail RNG.
With such a powerful engine driving sales on the site, Amazon recognizes its future is tied to membership growth. But recent reports indicate the loyalty program’s growth might be slowing. Morgan Stanley’s stats show that memberships were stagnant at 40 percent of America for the third and fourth quarter of 2017.
“Amazon is reaching a level of saturation to some extent with their Prime members,” O’Leary said. “I see statistics that there are 90 million Prime memberships in a country of only 300 million people. I think they understand to continue to grow as they have been, they have to go after as many different demographics as possible and they have initiatives around that.”
To keep numbers moving in the right direction, the company has rolled out new programs like monthly memberships and special pricing for those on food stamps to reach beyond higher income households, which have traditionally been its core demographic.
Macy's has been investing in activewear, plus-size and maternity apparel inventory online and yielding impressive results among department-store peers.Read more
JC Penney is placing the digitally connected tween consumer on its radar—and the retailer is offering a new fashion-forward apparel line for their various lifestyle needs.Read more
Though millennials, athleisure and e-commerce have been the driving forces in apparel sales—and they still are—growth is slowing and so are sales.Read more
Even taking the company’s Q4 e-commerce slowdown into account, there’s no doubt that Walmart’s online business got a shot in the arm under Jet.com's Marc Lore, but rumors are swirling that he could be planning an exit.Read more
In its latest effort to ramp up interest in shopping its stores, Spanish fashion retail chain Mango has partnered with Vodafone—one of the world's leading telecommunications companies—to install digital fitting rooms in all top Mango stores worldwide.Read more
A few particular pain points around search and security are keeping online retailers up at night, according to new findings from Juniper Research.Read more
When a footwear innovator like Adidas approaches a company that’s never made shoes, the industry takes notice. The footwear brand exclusively tapped Carbon Inc., a molecular science meets 3-D manufacturing firm, to take its sneakers to the next level. And what resulted was Adidas’ Futurecraft 4D.Read More Read more