For the first time in 13-year history of Amazon Prime, the number of membership in the annual message CEO Jeff Bezos’ shareholder, along with other statistics around the Prime business, which show the company’s dominance in e-Commerce.
Amazon Prime 100 million (or more) members worldwide shipped more than 5 billion products with service in 2017. The program also signed more members in 2017 than in other years. The news is not too great a surprise for analysts and agencies, but it is another attraction—and a Wake-up call to brands.
“Brands need to take notice because they gradually become wrapped around the finger of the Amazon,” said Matt Tepper, Director of strategy, North America, Wunderman. “Every month, they lose margin because Prime knows that they will receive their products in two days versus seven to 10 days of delivery from sites owned by automakers.”
Sucharita Kodali, Vice President and principal analyst at research firm Forrester, said that brands and retailers need to understand that Prime is much more than two days in a row-is the delivery of the ecosystem, full of music, movies, photos and more.
“Prime is a compelling loyalty program,” said Kodali. “They are faster than everyone else [and] they have a larger range than anyone else. [These companies] are not just competing on one small aspect of that.”
For companies such as Walmart and target that are shaking up management, the acquisition of new companies and trying to make a big push in e-Commerce, Kodali not sure if the changes they make enough to compete with Amazon—regardless of a 100 million Prime members.
Another staggering number in the letter included 5 billion of goods which are transported with the Prime in 2017. The white house released the task force to oversee the postal service of the United States to figure out how to solve their numerous problems with money (many of which the President of the trump attributed to Amazon), but other shipping companies, like UPS, continue the value in the e-Commerce giant as a client.
“We support all our clients with the leading e-Commerce solutions and plan to expand these relations in future”, – said the press-Secretary of the COC. “UPS continues to experience topline growth and improved margin depends on the business-to-consumer growth and strong international expansion”.
In the letter, Bezos also noted that “all the products” want “to recognize” Prime members in the grocer’s point of sale system. What it will end up looking like is not clear and should not be too much of concern for the grocery industry—again.
“Amazon does not have a history of very close integration of the brands,” said Kodali.
Amazon now faces two key challenges: to continue to grow Prime membership and increased attention like a little execution work centers of the company to do.
The company also revealed for the first time, what his average employee’s salary amounted to $28,446 in 2017. A new report from the Intercept also showed that in some States, Amazon employees can expect to participate in the supplemental nutrition assistance program (Snap).
Kodali indicates that while the Prime continue to grow, the slowdown in the US, which is why Amazon is investing heavily in foreign markets.
When the Prime began 13 years ago, Amazon is not like anxiety or fear in the hearts of many outside adventurers, trying to find the Lost City of Z. in the end, the company was less than the forecast for the fourth quarter in February 2005 and is still trying to prove to investors that she can make this business work. But currently, Amazon has become a force that threatens so many of the automakers existence.
“At the end of the day, the “brand” is still important to differentiate on Amazon, but with the rapid erosion of the margin, it will be more difficult for brands to Fund initiatives in the field of branding,” said Tepper.