Amazon Prime’s Next-Level Membership Gimmick
Amazon wouldn't have any Oscars if not for Amazon Prime, which is why residents of Manchester-by-the-Sea, Massachusetts, are getting free memberships. The gimmick offers some lessons for associations.
Membership gimmicks aren’t always easy to formulate, but they can be an effective way to draw attention if done well.
Case in point: Amazon’s recent move to celebrate its Oscar wins for the film Manchester by the Sea. The movie helped put the real-life Massachusetts city, population 5,136, on the map. And Amazon, which is going to bring the film to its Prime Movie service on Friday, wants to keep it there.
This week, the company sent packages to every Manchester-by-the-Sea resident that included free Prime memberships, along with a three-pack of Wickedly Prime Popcorn. The $99 price tag for Prime isn’t cheap, and the $14.22 for the Wickedly Prime bags certainly ensures it won’t be the cheapest thing Amazon does this week. Some back-of-the-napkin math puts the cost of the promotion at nearly $600,000.
But the gimmick could win over people outside the city by earning the company free press and reminding folks that unlimited Manchester-by-the-Sea viewings are a benefit of Amazon Prime. (How many viewers will return repeatedly to the film is an open question. It’s a bit of a bummer.)
“We wanted customers in the town to enjoy popcorn and a movie on us,” Amazon Video Vice President Greg Hart said in a statement. “Manchester by the Sea is a masterpiece representing the best of cinematic storytelling. In other words, it is wicked awesome.”
Of course, Amazon can get away with the move because it has proven just how hugely successful Prime is as a model. Designed to help encourage future payments by customers while offering useful benefits like free two-day shipping and included content, Prime is used by 60 percent of Amazon’s shopping base, according to The Motley Fool.
The company counts 80 million members as Prime members, and membership grew by 8 percent in the most recent quarter.
Beyond turning celebrations into marketing opportunities, perhaps the biggest lesson that associations can take from Amazon Prime these days is to show a willingness to embrace a monthly model. Amazon was slow to introduce the offering, only doing so last year. While the company charges slightly more for the monthly subscription—$10.99 per month, versus $8.25 per month if paid yearly—it represents 26 percent of all Prime members. Not only does Amazon make more money from them off the bat, but it helps slowly build loyalty.
“We think that the monthly membership option appeals to the later Prime adopters, with a smaller, potentially temporary commitment, that ultimately yields a long-term commitment,” Josh Lowitz, cofounder of Consumer Intelligence Research Partners, told The Motley Fool.
And, of course, the reason Amazon won an Oscar in the first place was that it invested money in a secondary service that helped win over the stragglers. By spending more money on video, it increased video consumption on Prime—making its service stickier.
In other words, this Manchester-by-the-Sea story has a lot of layers to learn from.
Oscar-winning actor Casey Affleck, shown in "Manchester by the Sea." (Roadside Attractions/Amazon Studios)