Amazon just quietly raised the free shipping minimum for buyers who don't belong to its fast growing subscription service, Amazon Prime. The company said Monday that non-Prime members would have to spend at least $49 per order to qualify for free shipping, up from $35.
The e-commerce giant is likely pushing people towards subscribing to Amazon Prime, which costs $99 per year and gives users access to streamed movies, TV shows, and Amazon’s original productions, in addition to free two-day shipping on many orders.
For Amazon, Prime could be the company's next big growth engine. According to recent research, Prime is now being used by 38% of American households. Consumer Intelligence Research Partners estimates that Prime has 54 million U.S. members, up 35% from 2014. The report also showed that 47% of Amazon’s total customers are Prime members.
For non-Prime members, shipping may be free but it's a lot slower than the delivery for Prime members. Average non-Prime free shipping takes five to eight business days, whereas Prime members receive items within two days, and some items can even be delivered on the same day of an order.
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This isn't the first move by Amazon to encourage users to potentially try Prime. In 2015, the company debuted its own version of Black Friday with Prime Day, a one-day retail event with exclusive discounts offered for Prime members.
Also crucial to Prime’s growth is Amazon’s ability to make as many items as possible eligible for Prime’s fast shipping. With that in mind, Amazon has made a big effort to have third-party merchants use its own fulfillment centers, giving it more control so that it can ensure quick delivery to its users.
Amazon is notoriously quiet about the total number of Prime users and growth, so we may not hear from the company whether this move will encourage more Prime subscriptions.