Amazon: Priming Up Consumers
Posted: July 26, 2015, 8:20 p.m.
by Mary Claire Hunter.
In the ever-changing world of technology we live in, a company can’t be static. Even Amazon, a $1.75 billion company, has to look for ways to keep current customers happy while vying for new consumers.
For many consumers, Amazon is the first place to go when browsing for a product. Whether that product is actually purchased from Amazon, however, depends heavily on the person clicking the mouse. There is a huge difference between those who buy from Amazon occasionally and those who are Amazon Prime members — almost a $1,000 per year difference.
In a recent study conducted by Consumer Intelligence Research Partners LLC, Amazon Prime members spend $1,500 annually compared to the $625 that non-members spend. With that vast a gap in consumer dollars, it doesn’t take a marketing major to decipher that Amazon’s top priority is to develop campaigns that will convert Amazon shoppers to Amazon Prime members.
As a loyal Amazon Prime member — okay, I use my parents’ Prime account — I see the many benefits of paying $99 a year. The company added the ability to stream music and video, on top of the free two-day shipping, to a Prime membership. Amazon has recently launched two campaigns that promote the benefits of a Prime membership to those non-members — both of which, in my opinion, haven’t been very successful.
First, there was Amazon Dash, offered exclusively for Amazon Prime members.
At face value, it seemed like a good idea; I’m extremely brand loyal and stick to the same products. I can even relate to the woman in the video who shakes her head at the lack of K-cups in the drawer. The downfall to this campaign, and a downfall in general, is that it’s just plain lazy. I’m a supporter of any campaign that makes life a little easier, but is ordering K-cups online really that challenging or time consuming? Other consumers share this sentiment, and Amazon Dash did not live up to the hype or draw new consumers into a Prime membership.
Second, came Amazon Prime Day on July 15. Amazon advertised this presale as having “better deals than Black Friday,” so I tuned in to see which products it was offering. Even though the day posted high sale numbers for the U.S., personally, the entire day was a bust. I couldn’t find one thing I was even interested in buying, and that’s shocking. The good move by Amazon was that those who had free-trial memberships to Amazon Prime were able to participate in the “deals.” However, there is still buzz of how dissatisfied Prime members were with the day as a whole. I doubt many new consumers were convinced to pay for a Prime membership, if current Prime members were that unhappy.
Within the last week, it’s become more crucial that Amazon start campaigning for new Prime members.
Remember when I said ever-changing? Allow me to introduce the online shopping company, Jet, that went live this past Tuesday. Jet is marketing itself as a direct competitor with Amazon but promises to post even lower prices. It even shows Amazon’s price of the product so the consumer won’t need to visit Amazon’s website directly.
According to Jet CEO Marc Lore, the company’s intention isn’t to go up against the Amazon Prime loyal. But with Amazon targeting those who are not Prime members and trying to get them to become members, wouldn’t that make Jet’s and Amazon’s target audience the same group of consumers?
Will the negative feedback of Amazon’s latest marketing tricks trickle down to the ears of casual online retail shoppers and convince them to give Jet a try instead?