Amazon wants everyone to be a Prime member and the e-tailing giant is taking steps with its Prime Now on-demand delivery program to bring the remaining holdouts on board. Beginning in May, according to reports, Amazon plans to expand Prime Now beyond a mobile app to make it available on desktop computers. The company also plans to sell advertising to brands, promising to provide them with greater exposure, while helping to offset its own costs in the process.
Prime Now is currently available to individuals who have downloaded the mobile app and have paid the $99 annual fee to be a member of Amazon Prime. The Prime Now program offers free delivery of goods within a two-hour window. Those wanting their orders within an hour's time pay a $7.99 delivery fee.
One of the more interesting aspects of Amazon's plans to expand the reach of Prime Now, first reported by Bloomberg, is its strategy to sell brands ad space to support the move to the main website.
Advertisers would pay $500,000 for Amazon's "Launch Hero Package" which includes ads on the e-tail website along with promotions in company e-mails for about two weeks. Bloomberg's reporting cited documents that placed the standalone value of the e-mail promotions at $100,000.
What's not clear from reports is whether the ad fees paid by manufacturers will be part of traditional brand advertising budgets or sales promotion. If the latter is the case, the cost of goods to Amazon will surely go up as it does with all other retailers that seek upfront fees from brands rather than negotiating on a net price basis.