Amazon is encouraging the whole of India to sign-up on Prime, its premium membership service, which is essentially the US-based e-commerce giant’s biggest loyalty program. And the hook is faster deliveries.
In the first phase of the “Great Indian Festival” sale Prime memberships, at Rs 499, was the most sold product in Amazon’s history in India – more than smartphones or televisions – as customers wanted their orders to reach faster, Amit Agarwal, country manager of Amazon India told HT.
For the Prime buyer, the membership was offered on a 60-days free trial (stopped right before the sale started), has its own value. If a non-Prime member orders a product it can take up to 10-12 days to reach you, but for a member its guaranteed delivery within two days.
Once Prime’s free trial period got over, it automatically added the membership to the next order on Amazon (often resulting in its purchase). The membership letter is nicely delivered in a blue envelop -- the first mark of being premium.
The popular belief was that customers shop for cellphones, clothes or electronics a couple of times a year, mostly on discounts, and that they would never pay for convenience. “The fact that premium delivery went up by five times and Prime was a top seller shows that customer are willing to buy convenience when they trust a site,” said Agarwal.
What was more surprising is that 35% of all Prime memberships were sold in smaller towns, which reflects that convenience isn’t limited to metros, but even in smaller towns people are shifting to online shopping and want quicker and reliable delivery.
To make Prime more attractive, Amazon opens up the sale 30-minutes early, only to its members. It also has something called the Prime Day, a sale period exclusive to the members.
Once a Prime member, Amazon assures that it has your loyalty. “It becomes a e-commerce platform of choice once you have purchased a membership,” said Sanchit Vir Gogia, founder and chief analyst at Greyhound Research.
As Prime grows it will also have exclusive video content, another catch for members. It has already partnered with Dharma Productions to premier its upcoming movie. There are more partnerships in the pipeline. Amazon is tight-lipped about it, but intends to change the way video content is consumed, rivaling Netflix, Hotstar, YouTube and other video streaming apps and websites.
As far as e-commerce is concerned, Agarwal believes that the customer would come to us even after the festive season is over. “The customer will shop more and more as they use the Prime membership… I think this is a big inflection point in e-commerce, and takes India in the direction in which e-commerce should be,” he said.