Almost Half Of Households In US Has Amazon Prime, Says Piper Jaffray
Piper Jaffray report concluded that households which earn more than 112,000 annually will have a Prime subscription.
Amazon Inc.’s recent success is due to its loyalty program membership, Prime, which has taken online shoppers by storm. The company is now the reigning monarch of American online shopping marketplace which the majority of the United States citizens prefer. The Prime membership is a $99 per year subscription service which offers multiple benefits to its customers. The online retailer has grown immensely in the past two to three years and most of its success is credited to its loyalty program.
Amazon Prime is preferred in many households which have a higher income than usual in the United States. A financial services giant of the United States, Piper Jaffray, released a report earlier this week that the households which earn more than or equal to $112,000 per year will have a Prime subscription. If they do not, then these households are most likely to subscribe to the service. Amazon Prime membership offers various benefits such as free shipping, deals, lightning discounts, video streaming, and music library etc.
The report suggests that almost three fourths of the households that have high income will subscribe to the service which is a 55% jump from 2014. It is not official as Amazon does not release its numbers regarding Prime subscription and AWS business.
Piper Jaffray adds in his report, “Subscribers are increasing across all income levels, and 50% of American households — between 57 million and 61 million — have signed up.”
Analysts know that Prime is now an integral part of Amazon’s business and it is one of the most important and strongest revenue streams in its e-commerce division. The subscription service allows the company to gain loyal customers through this push. At the beginning of this year, it was also reported that the customers who have a Prime membership tends to spend more at the online e-commerce platform than those who have not subscribed to Prime. Prime customer spends twice as much each year as a non-member.
Amazon mostly adopted accurate strategies for Prime to succeed and increase customer base. The Piper Jaffray study focused on the spending habits of teenagers, and found that Amazon was the preferred website among teens from higher-income families. It is becoming one of the biggest and largest companies which is performing in all divisions i.e. e-commerce platform, cloud computing, etc.