02/28/2019

The Prime Effect: How Amazon Is Helping Retail Membership

Consumers are subscribing to similar services

You know how they say that a rising tide lifts all boats? Well, when it comes to membership models in the retail sector, perhaps the saying should be changed to “a rising Prime lifts most boats.”

Yes, Amazon Prime is giving many established retail brands a big boost as they experiment with the membership strategies that Amazon has been wildly successful with. According to data that the analysis firm AlixPartners shared with Retail Dive, members of Prime are more willing to test the waters with other membership programs. Amazon Prime customers are three times more likely than other consumers to subscribe to other services, and more than half of Prime members use another service on top of Amazon’s offering.

The secret sauce appears to be brand familiarity. According to the AlixPartners data, 88.7 percent of consumers say the next subscription offering they plan to join is from an established brand as opposed to an internet startup (11.3 percent). (Hence “most boats” rather than “all boats.”)

Please select this link to read the complete article from Associations Now.