Prime on sale Friday for $67…and why it’s a smart part of Amazon’s strategy

Prime on sale Friday for $67…and why it’s a smart part of Amazon’s strategy

I’ve said it before: Amazon’s most important product is happy customers.

When Amazon has happy customers, they not only have more people buying from them, but they have something that other companies want (and for which they are willing to pay).

I think we saw a very clear (and in my view, smart) strategy from Amazon with the announcement of Amazon’s new tablet lineup (Amazon hardware announcements! $50 tablet, 10″ tablet, Fire TV 2).

Some people have criticized the tablets because they didn’t get more technologically cutting edge…they didn’t increase the number of pixels per inch, for example.

They got cheaper.

I think we are going to see Amazon have a huge success with the $49.99

Fire, 7″ Display, Wi-Fi, 8 GB – Includes Special Offers, Black (at AmazonSmile: benefit a non-profit of your choice by shopping*)

which is even cheaper in a six-pack (six for the price of five).

No, that model doesn’t have the best specs in the market…but they’ll do the job for most people in most circumstances.

I like to say that Amazon wants to be the infrastructure of the internet.

It wants to be how you get to everything.

The

Amazon Echo (at AmazonSmile: benefit a non-profit of your choice by shopping*)

is a brilliant part of that. I used it while I was writing this post.🙂 I wanted to make sure that I hadn’t forgotten anything that might affect what time I had to leave for work (which might affect how long I have on this post). While still writing, I said, “Alexa, what’s on my calendar?”. The Alexa Voice Service on our Echo read off the next four events from my Google calendar, assuring me that I knew the right schedule.

Yep…I got to my Google calendar through our Amazon device.

People see Google and Amazon as bitter rivals (especially with Amazon’s Appstore versus Google Play..Amazon tablets are generally excluded from the latter), but Amazon wants you to use Google…if you use Amazon to get there.

The Echo isn’t for everybody, though: it’s $179, and not everybody gets the value of it (although I would guess that many people who have it love it).

A $50 tablet, though? Very wide appeal.

Think of tablets as being like cars. Initially, owning a car (a “horseless carriage”) was a real luxury, and not that practical.

Eventually, it became almost a necessity (although that’s less true for Millenials than it was for, say, Baby Boomers). There developed a wide variety of models, and some relatively inexpensive models that simply got the job done were hits (think, perhaps, of the Volkswagen Beetle). You can spend $100,000 and more for a luxury car and get a luxury experience, or you can spend a lot less for it, and still get where you are going.

Amazon isn’t making the best cars in the world: it’s making the best roads.

Sure, you can drive on that road to Amazon’s store…but Amazon can also charge other stores for you driving on their roads, and not charge you for it. Alternatively, they can give you access to those other stores, even at a reduced price, so you keep using Amazon’s road.

Amazon Underground (at AmazonSmile*)

is a great recent example of this. You can get over 1,000 apps for free, many of them very popular, for which you would pay other places.

Read this

Seeking Alpha post by Alcaraz Research

for what I think is a cogent argument for why those $50 tablets and Amazon Underground combine to make something which other competitors simply can’t match at this point.

Oh, and Alexa is about to become a lot more ubiquitous! The new generation of the Fire TV family will include Alexa:

That means that for $50 (or $40, if you use a free app on your SmartPhone), you can have Alexa…and lots of content for your TV.

I think Amazon has learned the lesson of the Amazon Fire Phone (I have one). In that case, they tried to make a luxury car at a luxury price…and it was an admittedly failed attempt.

Amazon’s most important road?

For $99 a year (about $8.25 a month), members get

  • Amazon Video (streaming movies, TV shows ((some of which can also be downloaded))…including exclusive content)
  • Amazon Music
  • No additional cost 2-day shipping
  • The Kindle Owners’ Lending Library (borrow a book a month to read)
  • Kindle First which lets you own one book from a select few for free each month, and before they are actually released
  • Prime Photos (free storage of photos)
  • and more

Prime members are reportedly more satisfied and spend more.

The no additional cost 2-day shipping (and there are other options…from 1-day down to an hour in some cities) on many items? That’s key for Amazon’s consumer business. There’s typically more profit in physical items (what I call “diapers and windshield wipers”) than in digital items. More importantly, perhaps, is that many of the items aren’t sold directly by Amazon. Those third-party sellers pay Amazon…Amazon makes the road, the store pays for you to drive on it.

It’s an excellent deal at $8.25 a month…in some ways, perhaps replacing about $10 a month each you might pay each to a streaming video service and a music service…plus that shipping, and a book a month to own.

It’s an even better deal for $5.58 a month.😉

That’s the option for new subscribers, this Friday only.

To be clear, it’s $67 for year…I just broke it down to the monthly amount.

Why $67?

We just had the 67th Emmys, and Amazon’s original series Transparent won five  (including Outstanding Actor in a Comedy Series and Outstanding Directing for a Comedy Series).

Again, this will be this Friday only…and Amazon doesn’t often offer discounts on Prime.

My guess is that you won’t be able to

Give the Gift of Prime (at AmazonSmile*)

at the discounted price on Friday…but I still think that will be a popular gift this year.

I could certainly see Amazon offering a bundle of the gift of Prime and a Fire TV this holiday season…with Alexa as part of the mix, it would get people good and solidly hooked into Amazon. $179.99, maybe, for the bundle? That would work…and get a lot more cars out on Amazon’s road.😉

What do you think? Am I right that Amazon should concentrate on getting people to use them as the gateway to…well, everything?😉 Can luxury hardware be part of Amazon’s mix? How can other companies compete with Amazon? How would you improve Prime? What about offering magazine access as part of it? Feel free to tell me and my readers what you think by commenting on this post.

Join thousands of readers and try the free ILMK magazine at Flipboard!

* I am linking to the same thing at the regular Amazon site, and at AmazonSmile. When you shop at AmazonSmile, half a percent of your purchase price on eligible items goes to a non-profit you choose. It will feel just like shopping at Amazon: you’ll be using your same account. The one thing for you that is different is that you pick a non-profit the first time you go (which you can change whenever you want)…and the good feeling you’ll get. :) Shop ’til you help! :) By the way, it’s been interesting lately to see Amazon remind me to “start at AmazonSmile” if I check a link on the original Amazon site. I do buy from AmazonSmile, but I have a lot of stored links I use to check for things.

This post by Bufo Calvin originally appeared in the I Love My Kindle blog. To support this or other blogs/organizations, buy  Amazon Gift Cards from a link on the site, then use those to buy your items. There will be no cost to you, and a benefit to them.

2 Responses to “Prime on sale Friday for $67…and why it’s a smart part of Amazon’s strategy”

  1. Mary Adams Says:

    Amazon says you can gift the $67.00 prime deal to yourself but for whatever reason it won’t let me do it…. can somebody help me?

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