6 ms·

The trick with Prime however is, that you pay a 100 bucks a year and then feel the urge to get something back in return - ie faster shipping against non-Prime c

The trick with Prime however is, that you pay a 100 bucks a year and then feel the urge to get something back in return - ie faster shipping against non-Prime customers, etc. Clever, Amazon, clever.

copperx 11y ago
Kind of obvious, but it depends on your personality. Last year I got Prime and bought a grand total of 1 item in the entire year -- mainly because I research most purchases and Amazon is frequently the most expensive place to get something.
- rickyc091 11y ago
  Hmm, what are you purchasing that's more expensive than Amazon? Electronics and books are typically roughly the same cost. Household items are generally a little more expensive, but on some occasions it's the same or cheaper.
douche 11y ago
On the other hand, it doesn't take long to recoup that $100 worth of free, 2-day shipping, compared to the exorbitant rates that you used to have to pay for similar service from other retailers, or even $8-10 shipping and handling for standard shipping that catalogs used to charge.
- wskinner 11y ago
  Assuming that you would have paid $8-$10 for that level of shipping before. If you're like me, you never would have paid extra for 2-day shipping, but when it's framed in the language of "free", everything changes.
  - douche 11y ago
    I'm not that old, and I remember when you had to pay for any level of shipping.
    - detaro 11y ago
      If you compare Amazon with Prime to Amazon without and don't care about the speed, you only save on shipping if you often order <30 €. So Amazon has that benefit over many other stores even if you do not pay for Prime. Shipping prices generally are interesting. I get that shipping isn't free, but often enough there really would be potential to optimize. E.g. Amazon ships what they can in small cardboard envelopes (stuff like USB drives, small cables, electronic parts, that kind of thing). Efficient and fast. Other sellers want 4.99 € shipping for that. Which, if I' buying stuff for 15-25 €, is a notable percentage of the price. (And yes, if you send me a big shipping box in which I have to dig through the packaging chips to find the product, then you probably paid close to that for shipping, but that really wasn't necessary) Or the one that also has stores, where you can either pay 5.99 € shipping or do store pickup. And I'm thinking "eh, the price is a bit cheaper than everywhere else, but they want more shipping. BUT I can easily pick it up myself and maybe even get it a bit quicker.". Change the shipping method, and discover that it now charges me no shipping, but increased the product price by 5.99 €. And which point I ordered somewhere else, didn't go to their (big, probably expensive) store and didn't have a chance to be tempted to buy some additional stuff there.
      - pbhjpbhj 11y ago
        > (And yes, if you send me a big shipping box in which I have to dig through the packaging chips to find the product, then you probably paid close to that for shipping, but that really wasn't necessary) // At work I often ship ceramics [in the UK] - none of the couriers will insure it, the reason I'm told is that they all use overhead conveyors and so all parcels have to survive a 2m fall. Perhaps that's part of the reason for "overpacking". Another could be that it's observer bias; occasionally they run out of smaller boxes and so use a large one (necessitating lots of filler) and these occurrences get reported.
    - natch 11y ago
      Maybe they were A/B testing and you fell into a test group, because I've been using Amazon since very near the beginning and they have always had a free shipping option with no Prime needed. Or I'm going crazy, also a possibility ;-).
  - smoyer 11y ago
    I had two kids in college when we first bought Prime and it paid for itself in one semester due to textbook shipment costs. Buying textbooks via Amazon was often half the price of the local university bookstores (whether affiliated with the campus or not).
    - mikeash 11y ago
      Couldn't you have had those books shipped for free anyway, just slower? The way I buy online, Prime doesn't save me any money. I always go for the free shipping. Without Prime, I wait longer. Prime only saves money if you routinely pay for faster shipping, and do a lot of people really do that?
      - goldenkey 11y ago
        Amazon is not as cheap as the culture makes it out to be. Most of the time its actually a ripoff compared to other online shopping when you factor in promo codes or deals. Walmart.com offers free shipping for orders over $45. Target.com offers free shipping also. And if you are ordering dog/cat food or some niche thing, ordering from Chewy.com or computer parts from Newegg, etc.. will net you better prices. I'm not sure if its Amazon who's canvasing online forums or the myth just continues to get perpetuated by less than savvy shoppers. But Amazon is hardly cheap unless you really do need the 2-day shipping. Which most of the time, people don't mind waiting 3-5 days to save 10-20%.
        dxhdr 11y ago
        Disagree, most of the time it's actually the exact same price as any online site. Go comparison shop RAM or harddrives on Amazon and Newegg. Newegg may have a larger selection but all of the major name-brand items are the same price on both sites. If some sponges are $1 cheaper on Walmart.com, who cares. I'm not going to waste 10 minutes comparison shopping for sponges; Amazon is free to make its margins there if it'd like. Here's an example -- I found a Kingston SSD drive on Newegg that has a Limited Time Offer "See price in cart" gimmick discount. It's $1.10 more expensive on Amazon. I found another Newegg limited time discount Samsung SSD drive that's actually $0.76 cheaper on Amazon. You are not going to be saving 10-20% by waiting 3-5 days. Juggling logins and shopping carts across a half dozen different websites isn't convenient. Coupon hunting isn't convenient. Amazon Prime is all about convenience and it delivers.
- natch 11y ago
  Did you totally not notice that they have a free shipping option where you don't need Prime? You don't need the "fast" service and if you do you can pay for it on a one-time basis, and save money for the rest of the year.
  - douche 11y ago
    Before Amazon pushed Prime, you routinely had to pay for standard shipping everywhere. I remember ordering from catalogs in the pre-internet era where you would pay $20 on a $100 order for 2-4 week shipping. Being able to click a button and have whatever I desire show up on the doorstep within two days for $100/year is the next best thing to a Star Trek replicator.
    - natch 11y ago
      Shipping has indeed gotten faster. But there's no need to give Prime the credit for that. https://en.wikipedia.org/wiki/Fallacy_of_the_single_cause https://en.wikipedia.org/wiki/Fallacy_of_the_single_cause You don't have to pay $100/year for stuff to show up on your doorstep quickly, compared to the 2-4 weeks you cite. Compared to your 2-4 week yardstick, the shipping you can get for free is also very quick, usually 2 days, sometimes 4-5 days. And it can be 1 day, which is faster than Prime, if you pay a small (way smaller than $100) $n fee as needed. In real life, I've never had to pay for 1-day shipping. So that's $n * 0 = $0 that I've paid, all while getting stuff amazingly quickly compared to those pre-Internet catalog orders.
    - natch 11y ago
      > Before Amazon pushed Prime, you routinely had to pay for standard shipping everywhere. Totally not true. Amazon had a free shipping option for years before Prime. You just had to select it, and sometimes you had to buy $35 or more, same as it is today.
- fancyketchup 11y ago
  > [...] compared to the exorbitant rates [...] $8-10 shipping and handling for standard shipping [...] So here's the thing: It actually does cost $8-10 to ship most of the types of things you can buy on Amazon. I don't know what Amazon pays for shipping, but I would be surprised if FedEx/UPS/OnTrac will even look at an Amazon box for less than $3-5 (to say nothing of transporting it). Amazon Prime is predicated on the idea that you'll make Amazon your default retailer after paying for prime. Being a customer's default retailer is a powerful position for two reasons. First, many customers don't shop around for the lowest price on each item (they shop for lowest basket price), so your margins don't get squeezed quite as much. Second, you don't need to advertise (as much) to these people, so it reduces your marketing spend. As loyalty programs go, it's a very clever one.
  - toomuchtodo 11y ago
    > As loyalty programs go, it's a very clever one. So reverse Costco by mail? (Costco makes all of its money on memberships; margins are fixed at a low rate on all products. The loyalty factor is still there though)
tokenadult 11y ago
That's just the sunk cost fallacy. A lot of us still comparison shop. I buy from other sellers, but Amazon often has better terms (more reliable delivery, for one) and better prices than the other sellers I shop at.
peteretep 11y ago
I never felt that obligation. However, I note that when I don't have Amazon Prime, I abandon a fair number of purchases at the shipping page because the extra shipping cost gives me pause.
- natch 11y ago
  Which saves you money on unneeded purchase. Although there's no reason to abandon them, since there are no extra shipping costs if you simply choose the free option that's right there in front of you on the screen (well I can only speak for the US).

The trick with Prime however is, that you pay a 100 bucks a year and then feel the urge to get something back in return - ie faster shipping against non-Prime customers, etc. Clever, Amazon, clever.

copperx 11y ago

Kind of obvious, but it depends on your personality. Last year I got Prime and bought a grand total of 1 item in the entire year -- mainly because I research most purchases and Amazon is frequently the most expensive place to get something.

rickyc091 11y ago
Hmm, what are you purchasing that's more expensive than Amazon? Electronics and books are typically roughly the same cost. Household items are generally a little more expensive, but on some occasions it's the same or cheaper.

douche 11y ago

On the other hand, it doesn't take long to recoup that $100 worth of free, 2-day shipping, compared to the exorbitant rates that you used to have to pay for similar service from other retailers, or even $8-10 shipping and handling for standard shipping that catalogs used to charge.

wskinner 11y ago
Assuming that you would have paid $8-$10 for that level of shipping before. If you're like me, you never would have paid extra for 2-day shipping, but when it's framed in the language of "free", everything changes.
- douche 11y ago
  I'm not that old, and I remember when you had to pay for any level of shipping.
  - detaro 11y ago
    If you compare Amazon with Prime to Amazon without and don't care about the speed, you only save on shipping if you often order <30 €. So Amazon has that benefit over many other stores even if you do not pay for Prime. Shipping prices generally are interesting. I get that shipping isn't free, but often enough there really would be potential to optimize. E.g. Amazon ships what they can in small cardboard envelopes (stuff like USB drives, small cables, electronic parts, that kind of thing). Efficient and fast. Other sellers want 4.99 € shipping for that. Which, if I' buying stuff for 15-25 €, is a notable percentage of the price. (And yes, if you send me a big shipping box in which I have to dig through the packaging chips to find the product, then you probably paid close to that for shipping, but that really wasn't necessary) Or the one that also has stores, where you can either pay 5.99 € shipping or do store pickup. And I'm thinking "eh, the price is a bit cheaper than everywhere else, but they want more shipping. BUT I can easily pick it up myself and maybe even get it a bit quicker.". Change the shipping method, and discover that it now charges me no shipping, but increased the product price by 5.99 €. And which point I ordered somewhere else, didn't go to their (big, probably expensive) store and didn't have a chance to be tempted to buy some additional stuff there.
    - pbhjpbhj 11y ago
      > (And yes, if you send me a big shipping box in which I have to dig through the packaging chips to find the product, then you probably paid close to that for shipping, but that really wasn't necessary) // At work I often ship ceramics [in the UK] - none of the couriers will insure it, the reason I'm told is that they all use overhead conveyors and so all parcels have to survive a 2m fall. Perhaps that's part of the reason for "overpacking". Another could be that it's observer bias; occasionally they run out of smaller boxes and so use a large one (necessitating lots of filler) and these occurrences get reported.
  - natch 11y ago
    Maybe they were A/B testing and you fell into a test group, because I've been using Amazon since very near the beginning and they have always had a free shipping option with no Prime needed. Or I'm going crazy, also a possibility ;-).
- smoyer 11y ago
  I had two kids in college when we first bought Prime and it paid for itself in one semester due to textbook shipment costs. Buying textbooks via Amazon was often half the price of the local university bookstores (whether affiliated with the campus or not).
  - mikeash 11y ago
    Couldn't you have had those books shipped for free anyway, just slower? The way I buy online, Prime doesn't save me any money. I always go for the free shipping. Without Prime, I wait longer. Prime only saves money if you routinely pay for faster shipping, and do a lot of people really do that?
    - goldenkey 11y ago
      Amazon is not as cheap as the culture makes it out to be. Most of the time its actually a ripoff compared to other online shopping when you factor in promo codes or deals. Walmart.com offers free shipping for orders over $45. Target.com offers free shipping also. And if you are ordering dog/cat food or some niche thing, ordering from Chewy.com or computer parts from Newegg, etc.. will net you better prices. I'm not sure if its Amazon who's canvasing online forums or the myth just continues to get perpetuated by less than savvy shoppers. But Amazon is hardly cheap unless you really do need the 2-day shipping. Which most of the time, people don't mind waiting 3-5 days to save 10-20%.
      - dxhdr 11y ago
        Disagree, most of the time it's actually the exact same price as any online site. Go comparison shop RAM or harddrives on Amazon and Newegg. Newegg may have a larger selection but all of the major name-brand items are the same price on both sites. If some sponges are $1 cheaper on Walmart.com, who cares. I'm not going to waste 10 minutes comparison shopping for sponges; Amazon is free to make its margins there if it'd like. Here's an example -- I found a Kingston SSD drive on Newegg that has a Limited Time Offer "See price in cart" gimmick discount. It's $1.10 more expensive on Amazon. I found another Newegg limited time discount Samsung SSD drive that's actually $0.76 cheaper on Amazon. You are not going to be saving 10-20% by waiting 3-5 days. Juggling logins and shopping carts across a half dozen different websites isn't convenient. Coupon hunting isn't convenient. Amazon Prime is all about convenience and it delivers.
natch 11y ago
Did you totally not notice that they have a free shipping option where you don't need Prime? You don't need the "fast" service and if you do you can pay for it on a one-time basis, and save money for the rest of the year.
- douche 11y ago
  Before Amazon pushed Prime, you routinely had to pay for standard shipping everywhere. I remember ordering from catalogs in the pre-internet era where you would pay $20 on a $100 order for 2-4 week shipping. Being able to click a button and have whatever I desire show up on the doorstep within two days for $100/year is the next best thing to a Star Trek replicator.
  - natch 11y ago
    Shipping has indeed gotten faster. But there's no need to give Prime the credit for that. https://en.wikipedia.org/wiki/Fallacy_of_the_single_cause https://en.wikipedia.org/wiki/Fallacy_of_the_single_cause You don't have to pay $100/year for stuff to show up on your doorstep quickly, compared to the 2-4 weeks you cite. Compared to your 2-4 week yardstick, the shipping you can get for free is also very quick, usually 2 days, sometimes 4-5 days. And it can be 1 day, which is faster than Prime, if you pay a small (way smaller than $100) $n fee as needed. In real life, I've never had to pay for 1-day shipping. So that's $n * 0 = $0 that I've paid, all while getting stuff amazingly quickly compared to those pre-Internet catalog orders.
  - natch 11y ago
    > Before Amazon pushed Prime, you routinely had to pay for standard shipping everywhere. Totally not true. Amazon had a free shipping option for years before Prime. You just had to select it, and sometimes you had to buy $35 or more, same as it is today.
fancyketchup 11y ago
> [...] compared to the exorbitant rates [...] $8-10 shipping and handling for standard shipping [...] So here's the thing: It actually does cost $8-10 to ship most of the types of things you can buy on Amazon. I don't know what Amazon pays for shipping, but I would be surprised if FedEx/UPS/OnTrac will even look at an Amazon box for less than $3-5 (to say nothing of transporting it). Amazon Prime is predicated on the idea that you'll make Amazon your default retailer after paying for prime. Being a customer's default retailer is a powerful position for two reasons. First, many customers don't shop around for the lowest price on each item (they shop for lowest basket price), so your margins don't get squeezed quite as much. Second, you don't need to advertise (as much) to these people, so it reduces your marketing spend. As loyalty programs go, it's a very clever one.
- toomuchtodo 11y ago
  > As loyalty programs go, it's a very clever one. So reverse Costco by mail? (Costco makes all of its money on memberships; margins are fixed at a low rate on all products. The loyalty factor is still there though)

tokenadult 11y ago

That's just the sunk cost fallacy. A lot of us still comparison shop. I buy from other sellers, but Amazon often has better terms (more reliable delivery, for one) and better prices than the other sellers I shop at.

peteretep 11y ago

I never felt that obligation. However, I note that when I don't have Amazon Prime, I abandon a fair number of purchases at the shipping page because the extra shipping cost gives me pause.

natch 11y ago
Which saves you money on unneeded purchase. Although there's no reason to abandon them, since there are no extra shipping costs if you simply choose the free option that's right there in front of you on the screen (well I can only speak for the US).