Quote:
Originally Posted by issybird
Sure they can. But if they want to coerce more people to take the slow-ship option, they need to give back more. I assume Amazon parses the elasticity of this excellently, but it still means that some customers who would take slow shipping on their $5 item haven't been seduced away from the Prime shipping they *paid* for.
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Coerced?
Are they putting guns to people's heads?
Sending out Guido and Tananda?
Maybe it's time to take a step back:
Prime is a loyalty rewards program.
It offers perks to convince you to shop through their website.
The core is free two-day shipping.
That's it.
Everything else is frosting. Stuff Amazon adds to serve *their* needs, not yours. If they benefit you, then great. If not... Tough luck? Dunno. (Do you think a lot of people are going to drop Prime over not being able to apply the credits to Agency books that can't be discounted anyway?)
Hate to break it to you, but Amazon doesn't keep piling up the perks out of the goodness of their heart; they do it because they set aside a portion of the Prime revenue base for "subscriber acquisition" and, as the subscriber base grows, so does the pot of available funds and, since most of the digital perks are mostly fixed-cost services, that growth can be funneled into newer perks that serve their needs. If you look at the perks, each one exists to support a separate new business in the Amazon empire.
Prime Video was added to more quickly ramp up Amazon's video operation, which is being expanded into a paid service across the world. It has also given visibility to Amazon Studios that is allowing them to bring in A-list Hollywood talent. It is quite conceivable that an Amazon movie might win an Oscar next March.
Prime Music likewise spawned Amazon Music. It exposes listeners to acts they might want to hear more from, either by buying or by subscribing to the full-catalog service.
Prime Reading? Ditto. It exists to expose readers to a subset of Kindle Unlimited. Some will go on to buy further books by those authors or pay for a full subscription. (Remember, KU authors are Amazon customers, too. Of KDP.)
Discounts for Freetime Unlimited? Sell tablets. Catch the next generation of shoppers young.
Student Prime? Ditto.
Look closely and all the perks come with strings.
None of the perks benefit everybody.
Each perk is going to be a "Wow!" for some and a "Meh" for others.
It's all factored in: Prime perks are a grab-bag bundle and the "cost" of providing them is accounted for in a variety of ways, mostly promotion of the other businesses.
Slow shipping is no different.
It exists to get you to buy more stuff. Dry goods, mostly.
eBooks pose a problem there on two fronts:
The first is obviously Agency, which demands all their books sell at the same price all the time, everywhere.
The second, less obvious, is a potential antitrust claim of subsidizing the sale of ebooks with money from other businesses. Amazon might win such a case but they would have to spend litigation money.
Besides, applying the credit only to KDP titles makes KDP more appealing to its users and they too are Amazon customers. Unlike tradpubs, who are only suppliers and some only grudgingly so.
Net result: they apply the digital version of the perk where they can maximize the return two ways: selling more ebooks and helping their KDP customers. They're not crazy. There is always a business reason behind their moves. Nothing is ever just what it seems.
Those perks all have strings that help justify the existence of the perk by growing Amazon's businesses, not just their sales volume. They're tricky folks, Amazon.
A lot like illusionists, they always have a new trick up their sleeve.
You may like it or you might not but if not they'll come up with a new one eventually.