Just last year, Amazon announced that it was changing the pricing structure of its Amazon Prime service from $79 a year to $7.99 a month. While the company sees it as a sign of its added value, consumers just saw their bill jump to $96 bucks a year.
What gives? Well, it's a matter of perception. To folks who use Amazon strictly as a marketplace to set up wish lists and do holiday, birthday and wedding shopping, it's a nice online store with a $79 upsell that ensures two-day delivery. To Prime customers with a Roku box or other device that allows them to stream Amazon Instant Video, it's a great supplement to cable or viable competitor for Netflix. For consumers with Kindle e-readers or tablets, prime is basically a free library for online books.Unfortunately, Amazon and Prime are rarely all of these things to people at once, which is why the company reported its first quarterly loss since 2003 last year. It took a $169 million loss on its investment in flash-sale site LivingSocial alone, mostly because consumers don't know or care that Amazon owns it. Say what you will about Apple's (AAPL) iEcosystem, but at least Apple users know how each portion of it integrates with the other. Amazon has yet to make the clear connections between its Web services, marketplace, streaming and e-book services, devices and other offerings such as IMDB and Zappos. A Super Bowl commercial and ensuing campaign tying all of Amazon's holdings into one happy mutually supported family would go a long way toward letting mainstream America know it's not just an online version of the Sears (SHLD) catalog with user ratings. If Amazon wants to step losses, it has to help otherwise oblivious customers find some of its best features and incorporate them into the overall experience. Otherwise, you're just Berkshire Hathaway (BRK.A) with an online store.
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