Pros and Cons of Amazon Prime
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Consumer Reports has no financial relationship with advertisers on this site.
Amazon announced today that it will raise the annual price of its Prime membership from $99 to $119. The new price takes effect on May 11 for new members and on June 16 for those renewing. The company says it will send an email to existing members with renewal details in May.
Amazon made the announcement during its earnings call, explaining that the new price is justified and pointing out that the last increase in its membership fee was in 2014. Recently, the company has expanded Prime Free Same-Day and Prime Free One-Day delivery to more than 8,000 cities and towns and plans to keep expanding. It has also increased the number of items eligible for free two-day shipping in recent years from 20 million to more than 100 million items.
Brian Olsavsky, the company's chief financial officer, said that the cost of Prime is high for the company, especially with the shipping options and digital benefits that it offers. The price hike comes a few months after Amazon increased the monthly membership cost by 18 percent, from $10.99 per month to $12.99 per month.
Earlier in the week, Amazon announced a new service—packages can get delivered to customers' cars—as long as they have a Buick, Cadillac, Chevrolet, GMC, or Volvo made in 2015 or later. The cars also need to have an active OnStar or Volvo On Call account.
The new service is available to Prime customers in 37 cities and was created to help prevent package theft.
Last year Amazon launched Amazon Key, a similar service, which allows couriers to enter your home to drop off packages even when you’re not there. While Amazon Key requires you to pay $220 for a home smart lock and camera, there is no installation charge to let couriers access the trunk of your car.
If you don’t sign up for Prime, Amazon still offers free standard delivery when you buy $25 worth of eligible items.
Amazon Prime began as a fast and free shipping program for orders of any amount. Though swift, two-day delivery on millions of items remains the cornerstone of the service, the company has moved into video and music streaming, and cloud storage, which enhances the overall value proposition for those who take advantage of Prime’s extras.
The Benefits
There are other incentives to become a member.
Free same-day delivery. Prime members qualify for free same-day delivery on more than a million items and 1- and 2-hour delivery with Prime Now (available in select cities) on tens of thousands of items.
Amazon Prime Rewards Visa Signature Card. The Amazon Prime Rewards Visa Signature Card gives cardholders 5 percent back on purchases made at Amazon.com and Whole Foods. If you don’t have a Prime membership, you get 3 percent back.
There are other benefits to using the card—you’ll get 2 percent back at gas stations, restaurants, and drugstores, and 1 percent back on any other purchases. There is no annual fee, and if you use it while traveling, there are no foreign transaction fees.
Instant access to video streaming. Membership includes instant access to tens of thousands of movies and TV shows, including Amazon original series such as the Golden Globe-winning “Transparent” and “Mozart in the Jungle,” the drama “Bosch,” and “Doctor Thorne,” from “Downton Abbey” creator Julian Fellowes. You can watch at home on your computer, Fire TV, or other compatible devices.
Music streaming. Prime Music offers unlimited, ad-free access to more than a million songs and thousands of playlists and stations.
Prime Photos. Secure unlimited photo storage in the Amazon Cloud Drive.
Access to Lightning Deals. Members qualify for early (30 minutes before everyone else) access to short-term, deeply discounted Amazon Lightning Deals that often feature high-tech and fashion goods.
Kindle Owners’ Lending Library. Members get access to more than 800,000 e-book titles. You can borrow one per month, with no due date, along with one prereleased book per month with Kindle First.
Prime Now. With an Amazon Prime account, you can download a mobile app that allows customers in most parts of the country to shop from early morning to late night, seven days a week, for groceries, gifts, and food from neighborhood stores and restaurants. Delivery is within 2 hours free of charge or within 1 hour for $8. For restaurant orders, delivery is free within an hour of ordering, and the service is available from Amazon-affiliated restaurants in select areas.
Amazon Family. The benefits include 20 percent off diapers through the site’s Subscribe & Save service and 15 percent off eligible products from your baby registry.
Membership sharing. Two adults living in the same household can create an Amazon Household to share certain Amazon Prime benefits.
Why You Might Not Want a Membership
Of course, not everything about Amazon Prime is worth the membership. There’s the question of how often you shop on Amazon. If you aren’t online much or you don’t think you’ll take advantage of all the services membership offers, you might as well pass.
If you’re unsure whether Prime is right for you, consider signing up for a free trial. You’ll have 30 days to give it a test drive. But take note: At the end of the trial period, your credit card will be charged the membership fee automatically for the next period unless you cancel in advance.
Paid members who haven’t used their benefits are eligible for a full refund. You can’t receive a refund if any household member has placed a Prime-eligible order.
Editor’s Note: This article has been updated with new information, including Amazon’s latest pricing.
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