Amazon Prime is Amazon’s monthly or annual membership program. Back in 2005, when it had only been around for 10 years, Amazon launched the flat-fee shipping program. On its website, Founder and CEO Jeff Bezos wrote that the new feature was introduced to “take the effort out of ordering.”
Last week, Bezos announced in a letter to shareholders that Amazon Prime had surpassed 100 million subscribers. With the announcement, Bezos also added that “Amazon shipped more than five billion items with Prime worldwide, and more new members joined Prime than in any previous year — both worldwide and in the U.S.”
“No minimum purchase and no consolidating orders. Two-day shipping becomes an everyday experience rather than an occasional indulgence,” Bezos wrote. “We expect Amazon Prime to be expensive for Amazon.com in the short term. In the long term, we hope to earn even more of your business, which will make it good for us too.”
More than half of the items sold through Amazon now come from third-party sellers. The company’s own goods are also selling well, according to Bezos, who also added that last year was the best yet for Amazon Hardware sales, like Echo and Fire devices.
Bezos kicked off the letter by doling out some advice on how to run a business: “How do you stay ahead of ever-rising customer expectations? There’s no single way to do it – it’s a combination of many things. But high standards (widely deployed and at all levels of detail) are certainly a big part of it,” Bezos wrote in the letter.
He ended the letter saying,
This year marks the 20th anniversary of our first shareholder letter, and our core values and approach remain unchanged. We continue to aspire to be Earth’s most customer-centric company, and we recognize this to be no small or easy challenge. We know there is much we can do better, and we find tremendous energy in the many challenges and opportunities that lie ahead.
A huge thank you to each and every customer for allowing us to serve you, to our shareowners for your support, and to Amazonians everywhere for your ingenuity, your passion, and your high standards.
As always, I attach a copy of our original 1997 letter. It remains Day 1.
Prime costs $99 a year or $12.99 a month in the U.S., with similar membership prices in 15 countries. It includes perks such as free and discounted shipping, music and video streaming, and free e-books.