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Takeaway: Though a price increase likely should have happened years ago, Prime is good enough that an extra $20 bucks won't chase many away.

Editor's Note: Below is a brief, complimentary excerpt from Hedgeye Retail analysis. For more information on our services, click here.


Amazon Prime and Amazon Student Prime Membership Fee Changes

$AMZN | Is It Worth the Extra $20? - Amazon Prime image

  • "For the first time since it was introduced nine years ago, the price of Prime is going up. Existing Prime members will pay $99 per year on their annual renewal date and Amazon Student members will pay $49."
     
  • "The Prime Fresh membership fee will remain unchanged at $299."

Takeaway from Hedgeye’s Brian McGough:

Step 1 for Amazon was to get users hooked on its Prime service. Check. Mission accomplished.

Now, the company is going after price. And, while $20 may not seem like a big increase, when things change, people notice.

That being said, we have to admit that nine years is a long time to hold price steady. One could certainly argue that Amazon should have done this a number of years ago.

But all that really matters is what Prime offers. It's a sticky enough service that many won't be chased away by the $20 price hike.

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