I pledge allegiance to the United States of Amazon
Amazon.com is becoming as American as apple pie. While I’m not ready to follow those who believe that Amazon is nearing a day when it will vanquish all its retailing rivals, there is little doubt that the company has wound itself into the fabric of Americans’ lives.
At this point, there is plenty of evidence to support the view that the website has become the de facto search engine for those researching potential purchases online.
Today, 21 percent of those living in the U.S. are members of Amazon’s Prime program, according to a report by Consumer Intelligence Research Partners (CIRP). Even more impressive is that 46 percent of U.S. households have a Prime membership. (A Cowen & Co. study puts Prime household penetration at 41 percent, according to Internet Retailer.)
Michael Levin, a partner and co-founder of CIRP, told USA Today, the household penetration number is particularly relevant to understanding Amazon’s progress because “most couples and families use a single membership.”
The growth rate for the Prime program is impressive. In September 2014, according to CIRP, Amazon had 29 million members in its two-day shipping program. By the end of 2015, the number had grown to 44.7 million.
That last number actually puts Amazon ahead of Netflix for subscribers of its video streaming service (a Prime program perk). Where Amazon has fallen short is in converting its subscribers into viewers. That’s part of the reason the company has focused more on developing original content, like “Mozart in the Jungle” and “Transparent.”
According to Mr. Levin, per Investor’s Business Daily, 40 percent of Amazon Prime members use its free streaming service at least once a week. Forty-seven percent of Amazon’s Prime members in the U.S. are in the program for the free shipping.
- One in five American adults is an Amazon Prime member – USA Today
- Amazon.com Has More U.S. Streaming Subscribers Than Netflix – Investor’s Business Daily
- Amazon Prime is in nearly 41 million U.S. households – Internet Retailer
- 45% of Amazon’s U.S. customers are Prime members – Internet Retailer
What does the growth in Amazon Prime memberships mean for Amazon.com and its competitors? How much less likely, for example, are Prime customers to shop on sites other than Amazon after purchasing their annual memberships?