One of the main reasons people sign up for Amazon Prime is to get the FREE 2-day shipping. Heck, since I joined, I’ve seen things arrive the next day! It’s madness — in a good way — for the buyer.
But I’ve been hearing rumors that Amazon now has too many Prime members and can’t handle the shipping load. I think those rumors must be true because Amazon is once again pushing their No Rush reward program.
If you’re a Prime member, and you choose the slower 5-7 business day option, Amazon will give you a $1 Amazon Instant Video Credit.
A search on Google shows that Amazon tried this a couple of years ago but they gave away music credits. Now, with their Instant service blowing up, a video credit is much more enticing than a music credit. It is to me, anyway. I watch Amazon Instant Videos all the time and I’m constantly landing on options that require payment. In most cases, I’d happily take the $1 credit in return for slower shipping. Not always, but most of the time.
It’s interesting to note that Amazon just reported the biggest quarterly loss since 2012 – $126 million dollars. About double what analysts expected.
It’s not all bad news. Revenue was actually up 23% over last year which is better than expected. More people signed up for Prime, even though Amazon raised the price and we’re heading into the busiest time of the year for the online seller so that revenue number is going to keep climbing.
How many people are shopping on Amazon? We turn to Bloomberg for that:
Amazon doesn’t include information on active customers in its earnings report, but the company’s chief financial officer, Tom Szkutak, gives the goods in briskly delivered sermons during the company’s investor calls. This quarter, Szkutak said, Amazon had 250 million active accounts, up 16 percent from last year. That’s solid growth. As a point of comparison, EBay just published 14 percent user growth. Once again, Amazon is growing faster than the competition, which can pay dividends for many years to come.
So why the loss? Mostly because Amazon keeps investing in everything from sell phones to grocery delivery. Not saying a company shouldn’t grow but I don’t want growth in the wrong area to jeopardize the welfare of my favorite online store.