3 Things You Need to Know About Amazon Whis Week

Amazon is shaking things up in the e-commerce world. Here's what you might have missed this week.

Feb 21, 2014 at 6:00PM

It has been a busy week for the world's largest online retailer. From a price hike for its U.K. Prime service and the upcoming launch of a reported TV set-top box, to potential partnerships with brick-and-mortar retailers, Amazon.com (NASDAQ:AMZN) is firing on all cylinders. Let's take a closer look at Amazon's moves in the past week, and how these developments could push the stock higher in the weeks to come.

Amazon Instant Video

Source: The Motley Fool.

On Friday, Amazon said it would bundle two popular subscription services -- Amazon Prime and LOVEFiLM -- for customers in the U.K. and Germany starting on Feb. 26. The online retailer is using the bundle as an opportunity to increase the price of a Prime membership in these markets -- something Amazon has also considered doing in the United States.

Prime numbers
Amazon will now charge customers in the U.K. £79 (U.S. $131) for an annual Prime membership, up from £49 ($81) per year, according to GigaOm. Prime members in Germany will see a similar price hike  from €29 ($40) per year to €49 ($67) annually. Amazon says new customers who sign up for Prime before Feb. 26 will be able to lock in the lower price. Nevertheless, as part of the roll up, Prime members will get unlimited streaming for more than 15,000 movies and television shows, on top of unlimited one-day delivery on more than 7 million products.

In the U.S., Amazon currently charges an annual fee of $79 for its Prime membership, which already includes unlimited video streaming for users. However, that price could soon change. During the company's fourth quarter earnings call, Amazon said it would consider charging as much as $20 to $40 more for its U.S. Prime service .

Amazon Amzn Prime

Source: The Motley Fool.

While the e-commerce giant would likely lose some members if it goes through with a price hike in the U.S., it's a smart time to take such a risk, particularly as Amazon counts "tens of millions" of paying Prime members worldwide today.

Also this week came news that Amazon is finally ready to launch a TV set-top box. Amazon could release the streaming TV device as soon as next month, according to reports. While many of the details remain unclear, TechCrunch said the device would likely run Android software and might feature game support in addition to providing access to Amazon's growing library of digital content. One thing is clear: a TV set-top box would be a nice tie-in to Amazon's Prime service. Ultimately, it would act as a hub where Prime users could access all of the content included in their annual membership.

Calling all retailers
Rounding out this week's news is word that the company is in talks with major retailers to list their products on Amazon.com. Abercrombie & Fitch (NYSE:ANF) and Neiman Marcus are among the group of retail brands working with Amazon on a possible deal, according to The Wall Street Journal. Here's how the arrangement might work.

Amazon would promote products from a retailer such as Abercrombie on its site, though the listings would link directly to Abercrombie.com.. Having a listing on Amazon.com would give the retailer a much broader customer base. Meanwhile, it would give Amazon the opportunity to offer a wider selection of products with Prime shipping.

This type of deal is particularly well timed as Amazon considers raising prices for Prime membership. "Amazon would offer the goods with free shipping to its Prime customers ... though the retailers would be responsible for arranging and paying for the deliveries," the Journal reported.

As you can see, Prime is becoming an integral part of Amazon's growth strategy. Why shouldn't Amazon work deals around the program? After all, Amazon Prime delivered a 22% jump in sales for the online retailer last year -- bringing Amazon's total sales to $74.5 billion in 2013. That's because the service entices customers to spend more (and more frequently) on Amazon.com by offering free two-day shipping on an unlimited amount of deliveries for just $79 a year (for now).

If and when Amazon ultimately  increases its annual fee on Prime membership, customers may be more willing to stick around if products from mainstream retailers such as Abercrombie are eligible for Prime shipping. Looking ahead, these three developments should boost revenue growth for Amazon in the quarters to come. Still, the stock looks pricey today as about $346 a share. For that reason, investors may want to consider these growth stocks instead.

Unlock superior profits today with these under-the-radar growth stocks
They said it couldn't be done. But David Gardner has proved them wrong time, and time, and time again with stock returns like 926%, 2,239%, and 4,371%. In fact, just recently one of his favorite stocks became a 100-bagger. And he's ready to do it again. You can uncover his scientific approach to crushing the market and his carefully chosen six picks for ultimate growth instantly, because he's making this premium report free for you today. Click here now for access.


Tamara Rutter owns shares of Amazon.com. The Motley Fool recommends Amazon.com. The Motley Fool owns shares of Amazon.com. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

1 Key Step to Get Rich

Our mission at The Motley Fool is to help the world invest better. Whether that’s helping people overcome their fear of stocks all the way to offering clear and successful guidance on complicated-sounding options trades, we can help.

Feb 1, 2016 at 4:54PM

To be perfectly clear, this is not a get-rich action that my Foolish colleagues and I came up with. But we wouldn't argue with the approach.

A 2015 Business Insider article titled, "11 websites to bookmark if you want to get rich" rated The Motley Fool as the #1 place online to get smarter about investing.

"The Motley Fool aims to build a strong investment community, which it does by providing a variety of resources: the website, books, a newspaper column, a radio [show], and [newsletters]," wrote (the clearly insightful and talented) money reporter Kathleen Elkins. "This site has something for every type of investor, from basic lessons for beginners to investing commentary on mutual funds, stock sectors, and value for the more advanced."

Our mission at The Motley Fool is to help the world invest better, so it's nice to receive that kind of recognition. It lets us know we're doing our job.

Whether that's helping the entirely uninitiated overcome their fear of stocks all the way to offering clear and successful guidance on complicated-sounding options trades, we want to provide our readers with a boost to the next step on their journey to financial independence.

Articles and beyond

As Business Insider wrote, there are a number of resources available from the Fool for investors of all levels and styles.

In addition to the dozens of free articles we publish every day on our website, I want to highlight two must-see spots in your tour of fool.com.

For the beginning investor

Investing can seem like a Big Deal to those who have yet to buy their first stock. Many investment professionals try to infuse the conversation with jargon in order to deter individual investors from tackling it on their own (and to justify their often sky-high fees).

But the individual investor can beat the market. The real secret to investing is that it doesn't take tons of money, endless hours, or super-secret formulas that only experts possess.

That's why we created a best-selling guide that walks investors-to-be through everything they need to know to get started. And because we're so dedicated to our mission, we've made that available for free.

If you're just starting out (or want to help out someone who is), go to www.fool.com/beginners, drop in your email address, and you'll be able to instantly access the quick-read guide ... for free.

For the listener

Whether it's on the stationary exercise bike or during my daily commute, I spend a lot of time going nowhere. But I've found a way to make that time benefit me.

The Motley Fool offers five podcasts that I refer to as "binge-worthy financial information."

Motley Fool Money features a team of our analysts discussing the week's top business and investing stories, interviews, and an inside look at the stocks on our radar. It's also featured on several dozen radio stations across the country.

The hosts of Motley Fool Answers challenge the conventional wisdom on life's biggest financial issues to reveal what you really need to know to make smart money moves.

David Gardner, co-founder of The Motley Fool, is among the most respected and trusted sources on investing. And he's the host of Rule Breaker Investing, in which he shares his insights into today's most innovative and disruptive companies ... and how to profit from them.

Market Foolery is our daily look at stocks in the news, as well as the top business and investing stories.

And Industry Focus offers a deeper dive into a specific industry and the stories making headlines. Healthcare, technology, energy, consumer goods, and other industries take turns in the spotlight.

They're all informative, entertaining, and eminently listenable ... and I don't say that simply because the hosts all sit within a Nerf-gun shot of my desk. Rule Breaker Investing and Answers contain timeless advice, so you might want to go back to the beginning with those. The other three take their cues from the market, so you'll want to listen to the most recent first. All are available at www.fool.com/podcasts.

But wait, there's more

The book and the podcasts – both free ... both awesome – also come with an ongoing benefit. If you download the book, or if you enter your email address in the magical box at the podcasts page, you'll get ongoing market coverage sent straight to your inbox.

Investor Insights is valuable and enjoyable coverage of everything from macroeconomic events to investing strategies to our analyst's travels around the world to find the next big thing. Also free.

Get the book. Listen to a podcast. Sign up for Investor Insights. I'm not saying that any of those things will make you rich ... but Business Insider seems to think so.

Compare Brokers