Membership Takeaways From Amazon’s Medicaid Discount

By / Mar 12, 2018 (Jorge/iStock/Getty Images Plus)

Amazon’s plan to discount membership to its Prime service for people on Medicaid speaks to a key concept for association membership discounts: Often, they can advance a broader strategic goal.

For people who think a lot about membership strategies, Amazon’s Prime service is an interesting case to study. Even though it’s the ultimate for-profit enterprise, Prime highlights the potential of membership at maximum scale.

And that means Amazon often stretches in directions that your association may never think of—but they could offer some inspiration.

Last week, the company announced it would offer Prime memberships to Medicaid recipients discounted by more than half, to $5.99 per month. Standard customers pay $99 per year or $12.99 per month. Even compared with the yearly membership, it’s a discount of nearly $30.

The new program, which requires the customer to have a valid Medicaid or electronic benefit transfer (EBT) card, expands an offering Amazon started last year for those participating in other government assistance programs, such as the Supplemental Nutrition Assistance Program (SNAP) and Women, Infants, and Children Nutrition Program (WIC).

“We hope to make Prime even more accessible,” Amazon Prime Vice President Cem Sibay said in a blog post. “With more than 100 million products to choose from, low prices, time savings, and fast and convenient delivery options, the combination of shipping, shopping, and entertainment provide tremendous value to customers.”

The program has earned Amazon praise for “doing well by doing good” but also draws attention to product offerings that will likely come in handy specifically for customers on Medicaid, such as over-the-counter medications and eyewear. Healthcare consultant Lyndean Brick of the Advis Group noted to the Indianapolis Star that the move is also aligned with the company’s larger strategy to expand into the healthcare marketplace. Amazon recently announced a plan to partner with Berkshire Hathaway and JPMorgan Chase to launch their own employee healthcare company.

“They have a strategy to enter into the healthcare market and it’s clearly well thought out, and they are going to enter the industry from all sides simultaneously,” Brick said.

The model suggests a question for associations: Are there people who might not be able to afford membership in your organization but who might benefit from its offerings?

For example, two separate broadcast groups—the Streaming Video Alliance and the International Association for Broadcast & Media Technology Suppliers—have taken steps to target startup audiences. Those companies may not be able to afford a full-price membership but would likely benefit from participating in an association serving their industry. Another example of the strategy: student membership categories, which Amazon also offers for Prime.

So whether your association is large or small, don’t be afraid to take a cue from Amazon and consider how discounting your member benefits might attract a new key audience to your organization.

Ernie Smith

Ernie Smith is the social media journalist for Associations Now, a former newspaper guy, and a man who is dangerous when armed with a good pun. More »


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