August 31, 2012
In consumer news, an impressive statistic has surfaced from mega-retailer Amazon (Nasdaq: AMZN ) : More items are shipped using Amazon's Prime service than using its free Super Saver Shipping feature.
While at first blush this may not seem that meaningful, the implications are large. Amazon Prime is a membership service, and investors should never underestimate the value of recurring revenue and the sticky customers that membership brings.
Not only that, but the average purchase for Amazon Prime members is $49.23, well above the minimum of $25 that consumers must spend for the Super Saver Shipping service. This indicates a conscious decision to opt for Amazon Prime instead of Super Saver Shipping in many cases. In return, consumers are rewarded with streamed movies, a feature that competes with Netflix (Nasdaq: NFLX ) , and plants a firm standing within the Internet industry as a whole.