Thanks to a end-of-the-year marketing blitz, Amazon now has roughly 40 million Amazon Prime members.
The research, which was conducted by Consumer Intelligence Research Partners, also found that these valuable members spend $1,500 a year on average, compared to non-members who spend about $625 a year.
Initially, shoppers sign-up for Amazon Prime accounts to save on shipping costs, but later may find other benefits appealing, like free video and music streaming and free book rentals on Kindle. Last year, the membership increased to $99 a year, and this holiday, Amazon heavily promoted free trials that lasted for a month.
Over the holidays, Amazon said 10 million customers signed up for a trial, and based on a previously report, CIRP suggested that 70 percent would end up paying $99 for an annual membership. In the prior period, CIRP reported that Amazon had 29 million account holders.
CIRP’s research is particularly interesting since Amazon is so tight-lipped about the program, which is often seen as the gold standard in the retail industry. It gathered the data by surveying 500 people in the U.S., who made a purchase on Amazon.com during the fourth quarter.
However, Prime is not the only way that Amazon creates loyalty among shoppers. Devices such as the Kindle e-readers, Fire tablets and Kindle Fire TV, also encourage customers to come back to Amazon.com to shop.
In the chart above, you can see that Prime is the largest category of customer affiliations, but that tablets and e-readers also play an important role. In fact, Amazon Kindle owners are almost as productive as Amazon Prime members, spending $1,450 per year compared to $725 per year for customers who do not own a Kindle e-reader or Fire tablet, according to CIRP.
“Similar to Amazon Prime members, Amazon Kindle owners are better customers,” said Mike Levin, Partner and Co-Founder of CIRP. “They also shop more frequently, and also buy more expensive items on average.”