Why I Quit Amazon Prime … and It’s Not Their Price Increase

Amazon Prime has been amazing in my life. For a measly $100 per year, I get free shipping on almost everything I order. But the funny thing is I don’t really care about free shipping itself.

 I love the fact that I can just buy on Amazon and not have to shop around for free shipping.

I love the fact that I don’t have to give my credit card to lots of different companies.

I love the fact that they have my data and make it easy to order.

A few weeks ago, one of my pricing colleagues was asking why anybody was Prime, especially since their new 20% price increase. I proudly stated why the price increase didn’t bother me.

Amazon has just been my go to website … until now.

The other day I wanted to order some ZonePerfect bars. I had ordered them before. They were a decent price on Amazon. I went to check out and there was a shipping charge. I thought maybe it was one of those “add-on” items and dug in a little, but no. Turns out this is a “Pantry” item. They don’t have free shipping on pantry items. (Did I pay for shipping on my earlier orders?)

Oh, they offer free shipping if I subscribe to having products delivered to my house monthly. But why am I a Prime member?

I went to Walmart’s web site. They had the same ZonePerfect bars at similar prices and free shipping. I didn’t even have to pay for a “Prime” membership. Wow. I ordered them.

Now, whenever I shop at Amazon, I have to double check if they are charging for shipping. But wait, didn’t I subscribe to Prime so I didn’t have to check? Ugh. Hence, I’ve decided to stop shopping Amazon. I’ll use Walmart and Best Buy as my go-to sites. They offer free shipping, carry most of what I want and they don’t require a membership fee. Nice.

What’s the pricing lesson from all of this, though? Know why your buyers buy. Having your product offer less is no different than raising your price. In fact, it may be worse. Your buyers constantly make the trade-off between price and capabilities. Be clear about this. If you take away a capability, know that buyers who value that will leave—just as if you raised price significantly.

 

Mark Stiving

Mark Stiving

Mark Stiving is an instructor at Pragmatic Marketing with more than 20 years of experience in business startup, development, management, turnaround and sales and design engineering. He has helped companies create and implement new pricing strategies to capture more from the value they create, and has consulted with Cisco, Procter & Gamble, Grimes Aerospace, Rogers Corporation and many small businesses and entrepreneurial ventures. He has led pricing initiatives as director of pricing at Maxim Integrated and as a member of technical staff at National Semiconductor. Mark also has served as president of both Home Director Inc. and Destiny Networks Inc. and as an assistant professor of marketing at The Ohio State University. Mark also is the author of “Impact Pricing: Your Blueprint to Driving Profits” (Entrepreneur Press, 2011). He can be reached at mstiving@pragmaticmarketing.com.


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