HomeFinance NewsAmazon Reduces a Popular Customer Privilege

Amazon Reduces a Popular Customer Privilege

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Over 200 million people globally have subscribed to Amazon Prime, a service that contributes significantly to Amazon’s revenue. Prime members enjoy various benefits for an annual fee of $139, including free shipping, exclusive Prime Day deals, and a free Grubhub+ membership.

According to Amazon’s earnings report for the second quarter of 2024, revenue from subscription services, including Amazon Prime membership fees, totaled approximately $10.8 billion. This figure represents an 11% increase compared to the same period the previous year.

As Amazon Prime’s success continues, a notable change is imminent. The company plans to discontinue its Amazon Today service, effective January 24, 2025. Introduced in 2022, this service allowed Prime members to order products from local stores for same-day delivery or pickup through Amazon’s website or app. Participating retailers, such as GNC, PacSun, Diesel, and SuperDry, are required to achieve a “Pickup Readiness Rate” of 99%, involving order preparation within 60 minutes of notification.

Amazon Today is currently offered to Prime members at no charge if they spend $25 or more on eligible items. For spending below this threshold, the service costs $2.99. An Amazon spokesperson stated that the discontinuation comes amid overlapping functionalities with the company’s other rapid delivery services. The change aims to streamline offerings while maintaining access to same- and one-day delivery for most items previously available via Amazon Today.

The decision will affect Amazon Today employees, who face potential layoffs or reassignment within the company. Amazon’s CEO, Andy Jassy, recently highlighted record delivery speeds for Prime members, noting that over 5 billion units were delivered the same or next day this year.

Jassy mentioned the company’s plans to further reduce costs and enhance delivery speed through the development of its same-day facility network and optimization of its inbound inventory processes. These improvements follow past criticisms regarding Amazon’s delivery time promises, as some customers had reported delayed same-day and next-day deliveries.

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