When the Amazon Prime membership first launched in 2005, the flagship service offered free two-day shipping for a $79 annual fee in the United States. By September 2006, Amazon (AMZN) - Get Amazon.com, Inc. Report debuted Amazon Unbox (now known as Prime Video) and it was offered as a standalone service or it could be bundled into the Prime subscription.
In March 2014, Amazon made the first increase to the U.S. membership fee from $79 to $99, and announced Prime Music and Prime Photos would be added to the services offered. The first Prime Day event was held in July 2015 and generated almost $1 billion in sales.
By 2016, Amazon Prime had over 54 million members and several reports said that nearly half of all U.S. households were members of Amazon Prime. In May 2018 Amazon announced another subscription price increase, and had exceeded 100 million paid Prime member globally. Amazon also began expanding into more services, including gaming, fashion and styling services, and Prime Pantry which was later discontinued by the end of 2020.
According to Jeff Bezos’ 2020 letter to shareholders, Amazon now has more than 200 million Prime members worldwide, and more than 1.9 million small to medium-sized businesses sell across its platform. Customers have connected more than 100 million smart home devices to Alexa.
We’ve covered some of their Echo products in great detail over the holidays. Below is an outline the perks that come with the Amazon Prime membership today, the latest pricing structure, and why industry experts are speculating that an increase in fees will be implemented this year.
What is Amazon Prime?
Amazon Prime is a paid subscription service that gives users access to certain benefits that unsubscribed members cannot access. The service is available in 22 countries including the U.S., Australia, Canada, France, Germany.
How Much Does an Amazon Prime Subscription Cost?
After a free 30-day trial, Amazon Prime will cost you $12.99 per month, or $119 per year with a savings applied to the upfront cost. If you stick with a month-to-month subscription plan, it’ll cost you $155 per year. The $119 annual cost breaks down the monthly rate to just shy of $10 per month.
To put it into perspective, most shipping rates starts at $7 and increases with weight, distance, and delivery date. Over the holidays, I paid between $30-50 per package with various sizes of boxes and delivery across the country.
So, if you’re purchasing from Amazon at least once a month, or shipping a lot of packages during the holidays, you could easily make up the monthly cost of the subscription just with their free shipping offer.
Important reminder: once your free trial or membership period ends, you’ll be automatically charged for the next membership period.
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What are the Perks of Amazon Prime?
You’ll have access to multiple services, with a breakdown of each below.
- Prime Video: Access to a selection of movies, TV shows and live sports. Some of the latest Amazon Originals include the well-reviewed “Being the Ricardos” with Nicole Kidman and Javier Bardem, all episodes of the “Wheel of Time”, and “The Tomorrow War” with Chris Pratt.
- Prime at Whole Foods Market: Prime members can save an extra 10% off sale prices and deals offered on seasonal favorites. You can shop online or find weekly in-store deals. Prime members can also get a 2-hour grocery delivery and free 1-hour pickup from local stores.
- Prime Music: If you haven’t caved and purchased Spotify, this could be the alternative you’ve been looking for. Prime Music has a free version with stations and playlists. Amazon Music Unlimited is an additional $9.99 per month and includes up to 75 million songs, is ad free, and you can listen offline with unlimited skips. Can also be paired with Alexa for hands-free listening.
- Amazon Pharmacy: This prescription benefit can save you money if you do not have insurance. While not considered insurance, it can be used at participating retail pharmacies in the U.S. and Puerto Rico. When you order through the Amazon Pharmacy, the savings benefit is automatically applied, or you can present a digital card at the pharmacy when filling a prescription. This service cannot be combined with your insurance or copay cards.
- Try Before You Buy (formerly Prime Wardrobe): The free version is included in your membership, and you ship up to 6 items with a 7-day try-on period. Products include women’s, men’s, kids and baby clothing, shoes and accessories.
- Prime Reading: Get unlimited access to a rotating catalogue of ebooks and audiobooks, 1 free pre-release ebook every month, and magazines and comic books. The selection incudes fiction, non-fiction, children’s books, and more. You don’t need a Kindle to use Prime Reading, just download the Kindle apps for iOS or Android to use.
- Prime Gaming: With your Prime membership, you can claim free games in the gaming library. There’s 5+ new PC games added each month, and you can get additional in-game free content each week. Featured games include STAR WARS Jedi: Fallen Order and World War Z: Aftermath.
- Amazon Prime Day: And last, but certainly not least, Amazon’s annual Prime Day event. The sale lasts 48-hours and it includes major discounts across every major category on the site, from devices and electronics to fashion and home improvement.
Could Amazon Raise Prime Membership Prices in 2022?
What is the magic number that will cause memberships to pause or even decline? According to financial analysts in a New York Times article, rumors are circulating that Prime prices could increase in 2022. Amazon hasn’t made an official announcement about the rumored new pricing structure.
According to a poll conducted by Slickdeals, many commenters suggest $150 for Prime is a magic number that may deter them for good. Others commented that that unless it tops $200 a year, they won’t cancel their subscriptions because the convenience of shopping with Prime justified the annual costs. Based on previous price hikes, though, it seems a safe bet that prices could jump to $139 in 2022.
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