Amazon

I have to say, I just don’t understand Amazon–especially Amazon Prime (the free unlimited two-day shipping thing).  We just signed up for our free one-month trial, which we’ll follow with our free Amazon Mom subscription (three more months of free two-day shipping).  After that, we’ll see if we want to pay the $79/year to continue the service.

But just in the one week we’ve had Amazon Prime, we’ve made 4 orders of 15 total items. All of them were as cheap or cheaper than we could get them elsewhere, and they get shipped to our house for free in two days.  Even the diaper wipes were cheaper from Amazon than at the Coop, where everything has a standard mark-up that generally beats retail handily.

So, what I don’t get is: How on earth is Amazon making money? Their prices are low, their profit margins are incredibly slim, and now they’re paying UPS and FedEx to deliver us our stuff quickly and not getting reimbursed.

Anyway, guess it’s not really my problem. So I’m happy to take advantage while it lasts. And it does seem like same-day delivery is the future. But what’s going to happen when they drive all the local retailers out of business and still can’t make real profits? At some point, they’d go the way of Kozmo.com, right?

P.S. My crazy idea is to start a small business in the neighborhood where you tell Amazon to deliver to me, and then tell me exactly what time you’d like your package delivered.  Daytime, evening, late night, whenever.  I can’t be the only one that dreads leaving the house when UPS has my package out for delivery. And even for people with offices, better to get home delivery, rather than lugging your package home from the office, right?

5 Comments

  • November 26, 2012 - 4:33 pm | Permalink

    Assume you will be trying all the streaming options plus free books for your Kindle app on those cold, long winter, spring, summer, fall nights up with TK. Will be very interested in hearing if there is enough decent content available quickly enough to prove worth it even w/o the free 2 day shipping, and if the quality of the streaming is acceptable. Obviously and not surprisingly, focused on my issues.

    C u soon.

  • Daniel
    November 26, 2012 - 4:55 pm | Permalink

    Eh, maybe. For the most part, it just duplicates what Netflix has available. And the Kindle lending library, sadly, is only for people who have actual Kindles, not people who have other devices with the Kindle app. So for me, it’s mostly about the shipping. And the not having to go shopping :-)

  • Kathy Johnson
    November 27, 2012 - 5:35 am | Permalink

    Well, what happened to David and I was we started buying everything on Amazon because of the free shipping. But then you start buying things that aren’t prime eligible without realizing it and you pay exorbitant shipping. But you’ve gotten used to shopping at Amazon, so you keep doing it…. I’m not saying it’s part of the business model, but it’s such a contrast. If it’s not Prime Eligible, Amazon’s shipping rates are obscene – half the time the shipping is more than the item I’m trying to buy.

  • Daniel
    November 27, 2012 - 9:16 am | Permalink

    Yeah, that’s definitely a good flag, Kathy. Kesa was trying to order some picture frame mats yesterday, and it was $6.50 for five, but $50+ shipping. I think that one may win the prize for most obscene differential.

  • November 27, 2012 - 10:00 am | Permalink

    Agree on the shipping. I buy loads from Amazon, but always try to make it >$25 and items eligible. You’ve all probably seen the CNN bit on “the largest fulfillment center in the network,” in Phoenix, so shipping usually not much of an issue for me. There’s gotta be some benefit to living in the third world.

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