Amazon CEO Jeff Bezos disclosed in his annual shareholder’s letter for the first time that Prime now exceeds 100 million members worldwide.
Eugene Kim of CNBC.com had the news:
In 2017 alone, Amazon added more Prime members than any prior year, and shipped over five billion items through the paid membership service worldwide, he said.
Amazon also sold the most number of devices last year, with customers buying “tens of millions” of Echo devices, Bezos wrote in the letter.
With regards to Whole Foods, Bezos said the “technical work” is currently under way to bring Prime member benefits to the grocery chain.
The annual letter, which Bezos has published every year since 1997, is widely considered a must-read by business professionals for its rich detail around the Amazon CEO’s management principle and long-term thinking.
Jeremy C. Owens of MarketWatch.com reported that the number is higher than members of Costco:
In his annual letter to shareholders, Amazon Chief Executive Jeff Bezos disclosed Wednesday afternoon that Amazon Prime has topped 100 million paid Prime members worldwide. Costco claimed 90.3 million card-carrying members as of the end of its most recent fiscal year, though many of those were multiple members paying through the same account, as paid subscriptions were disclosed as 49.4 million.
“In 2017 Amazon shipped more than 5 billion items with Prime worldwide, and more new members joined Prime than in any previous year — both worldwide and in the U.S.,” Bezos wrote in his letter.
Amazon charges $99 a year for Prime membership, which offers free two-day shipping on certain items, access to the company’s streaming-video library and other media, including Amazon Music and many e-books, along with other features. The company recently increased the monthly subscription price for Prime from $10.99 to $12.99, with student subscriptions bumped from $5.99 to $6.49.
Laura Mandaro of USA Today reported that the number topped analyst estimates:
Amazon’s Prime memberships are an example of a program that is greater than the sum of its parts. Among other things, members get free, two-day shipping and in some areas one-day and two-hour shipping on some items, access to Amazon Prime Video, online storage and some music and a Whole Food rewards program/membership.
But it is the capacity of the program to more tightly-knit customers into the Amazon ecosystem that make it so valuable. Once members have access to free shipping, they immediately begin ordering more on Amazon and less elsewhere. Once they have access to Prime Video, they have less incentive to sign up for other streaming video offerings. As Amazon adds more perks leaving the system becomes less likely.
And once inside, they do more and more of their shopping there. Prime subscribers spend a lot more on Amazon — $1,300 per year on average — compared to about $700 for non-Prime members, according to Consumer Intelligence Research Partners.