With final exams going on, I've been remiss in starting my Christmas shopping... I decided to go ahead and buy a year's membership to Amazon Prime for $79. It gives you free 2-day shipping on an unlimited number of orders for a year. (You can also get overnight for only $3.99 per item.)
I often end up delaying orders so I can bunch them together and this eliminates that need. It also buys me a few extra days to think about what I want to get people for Christmas. It will also be great for buying textbooks next semester.
Apparently, I'm not the only one who thinks this is a good idea:
Being a heavy Amazon customer, I signed up, and it's definitely changed the way I shop there. For example, I just ordered some of these Balance nutrition bars -- a snacking mainstay at our house -- where I wouldn't have done so before without tacking more stuff into the order to offset the shipping charge. But now I just order them as needed via Amazon, with no shipping charge, rather than buying them in bulk at Target. They're a bit cheaper than Target's price, and I don't buy all the other stuff I wind up buying when I visit Target -- a double savings of sorts.
I don't know whether other online merchants, lacking Amazon's clout with shipping companies, will be able to emulate this, but I suspect that over time cheaper shipping will start cutting into brick-and-mortar merchants' business. Maybe the 1990s bubble was just premature, and not fundamentally wrong . . . .
Using this to order cheap stuff like nutrition bars? Now that's a clever idea! I think I'll be able to find a lot of good uses for this service... (Or should I say a lot of "goodies" to use this service for?)
Is Amazon Prime some sort of beneficial form of price discrimination? Or by charging this one up-front fee, does Amazon then sell their items (plus shipping) at cost? Does that mean that Amazon's prices on average already include enough profit margin to cover their cost for second-day shipping?
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