Amazon's Prime numbers

Amazon Prime launched in 2005 with a simple but risky theory: More spending leads to higher shipping volumes, which helps Amazon negotiate with vendors and lower shipping costs. Those savings help pay for Prime and push down prices.

Revenue from subscriptions – mostly Amazon Prime memberships – increased 59 percent in the third quarter compared to the same period in 2016, Amazon said last week.

More importantly, a Prime membership is intended to create loyal customers to Amazon's platform which in turn results in consumers spending more money. And it works as on average, a Prime member spends $1,300 a year on Amazon compared to $700 for non-members. This may explain why Amazon is eager to continue adding benefits to a Prime member since the $600 spending difference multiplied by an estimated 90 million Prime users is no doubt a lot of money.

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