Amazon to expand Prime programme
BENGALURU: More than two months after doubling the price of its Prime subscription service, online retailer Amazon India is expanding the Prime programme as it looks to retain a large chunk of its existing customers by making the service more attractive.
Amazon India (Amazon Seller Services Pvt Ltd) will now offer over 25 million products in the Prime service, up from 11 million earlier, at a delivery speed of one or two days, said Jamil Ghani, vice-president, Prime International, Amazon. Amazon is also investing hundreds of crores of rupees to expand its video offering in India, including spending on producing original content.
Under Prime, Amazon offers fast delivery, additional discounts and video streaming to customers.
“One of our central tenets in Prime is that we increase the value of the programme to the membership. One central way to do that is to continue to invest in existing benefits like selection and video. So this expansion in selection is in line with our belief that every day customers should have more selection to enjoy. We also add value by introducing new benefits so there’s more to come there as well,” said Ghani.
In November, Amazon increased the subscription price for Prime to ₹999 a year from ₹499. The company launched Prime in July 2016 at an initial discount of 50% from its price of ₹999.
“With increased selection, we feel that Prime is worth that (price),” said Akshay Sahi, head of Amazon Prime in India. “The benefits we’re providing have reached a significant value and customers have had enough time to try that programme out so now we can go to our (original) price.”
Amazon is also introducing a music service to rival that of Apple and Google Inc’s music services. The company may launch the service in India this quarter.
“In other countries, we charge an additional fee for access to the unlimited music catalogue. But in India, we’re including it in Prime at no extra charge,” Ghani said.
The Prime programme has turned out to be a key differentiator for Amazon in the market share battle with local rival Flipkart, especially in big cities. Amazon declined to share the number of Prime subscribers but it said that some 30% of all orders on Amazon India come from Prime subscribers. Research shows Prime customers spend a lot more on Amazon than they did previously, they buy products they weren’t buying earlier and they also tend to reduce their spending on other platforms.