Amazon Prime members aren’t just passionate shoppers on Amazon. It turns out they are hot on online shopping in general. In fact, they spend nearly 80% more time than non-Prime members on shopping related activity online.
In a five-month study from August to December tracking the online behavior of nearly 300 U.S. Prime members and 419 non-Prime members, all of whom own a mobile device, market research firm GfK found that each Prime member spent an average of 12.8 hours on online shopping-related activity over that period, including browsing retailers’ websites or apps. That’s nearly 80% more the than 7.2 hours spent by non-Prime members.
While it’s no surprise that Amazon is the most used shopping “resource” as cited by 78% of Prime members, more than three-fifths of the Prime shoppers said they also visit and shop mass discount retailers, such as Walmart, as well as pure-play online merchants other than Amazon. And compared to non-Prime members, a higher percentage of Prime members shop and visit warehouse club sites like Costco. They also are more likely to shop for groceries and home-improvement products online.
(And, in another sign of Amazon’s enormous influence, Amazon also ranks as the most used shopping resource by non-Prime members.)Even though they are spending a lot of time on Amazon, there are a lot of opportunities to reach them.
Other retailers shouldn’t “shy away from Prime members,” said Christina Pate, senior research director of digital experiences at GfK. They “are a big portion of the online shopping population. There’s a lot of time spent shopping outside of Amazon. You can’t cut them out. Even though they are spending a lot of time on Amazon, there are a lot of opportunities to reach them.”
For instance, holiday shopping period would be a key opportunity for other merchants to reach Prime members, Pate said. The GfK study found that Prime members tend to begin their holiday shopping on other sites in early November before picking up their activity on Amazon on Black Friday week, she said.
There’s another reason to target Prime members: they tend to be more affluent. Nearly 30% of them have household income of more than $100,000, compared to 16% for non-Prime members, the GfK study found. About two-fifths of Prime members in the study have household income of between $50,000 to $99,999, compared to 33% among non-Prime members. (To be sure, GfK cautioned all of the respondents in the study are adult smartphone owners, which may not represent income of all Prime members.)
The promise of Prime members isn’t lost on other retailers and brands: GfK decided to conduct the study after its clients asked it about the impact of Prime members on other retailers outside of Amazon, Pate said.
Amazon doesn’t disclose the size of its Prime membership, but in its most recent annual filing this year, it said retail subscription services revenue, which includes annual and monthly fees generated from Prime, more than doubled to $6.4 billion in 2016 from $2.76 billion in 2014.
Cowen & Co. in January estimated there were about 50 million US Prime subscribers based on a December survey, up 23% from 41 million a year earlier. They represented 57% of total Amazon purchases in December, up from 46% a year earlier, according to Cowen. It said Amazon US Prime’s “remaining addressable market” is over 60 million US households, half of which already buy goods on Amazon on a monthly basis.