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Amazon Prime Expansion & Instagram's New Product Tags

There’s no question that Amazon dominates the ecommerce market in the U.S. This is largely driven by Amazon Prime, the standard for online shopping convenience. New data, however, suggests that Amazon may be reaching its limit. As a result, Amazon is focusing on expanding in other areas, such as video production, logistics, and tapping into larger ecommerce markets such as China and India.

20% of U.S. Population Already Have Amazon Prime Membership

According to securities research firm Consumer Intelligence Research Partners, 20% of the U.S population are Amazon Prime members. This accounts for 65 million online shoppers, up by 38% from last year.

Prime members are particularly loyal, spending twice as much on Amazon Marketplace than non-Prime members - $1200 compared to $600. The survey also found that among all Amazon Marketplace shoppers, 52% of them are Prime members.

Despite the significance of Prime, Amazon is starting to reach a limit of available U.S households. According to CIRP, the number of people signing up for Prime is slowing. Amazon is trying to remedy this by offering a monthly membership fee structure of $10.99, instead of the $99 annual subscription plan. This move was done to improve Prime conversion rates and add on seasonal shoppers sitting on the sideline.

Amazon Prime still gives marketplace sellers a strong advantage over online commerce. In fact, Amazon Marketplace sellers sold 30% more items during Prime Day 2016. Online retailers can tap into this consumer base by using Amazon’s FBA service or using Seller Fulfilled Prime.


Amazon Launches a Cheaper, Limited Version of Prime in China

Last Friday, Amazon expanded their Prime subscription program to customers in China, a country where it has struggled to gain market share against local competitors Alibaba and The program, which doesn’t include digital content streaming, will cost 388 yuan a year, about $57 U.S. dollars.

Chinese customers will be able to enjoy Prime’s free shipping on goods sold domestically, as well as free shipping on overseas goods costing more than $29.50. As the world’s largest ecommerce market, China represents a huge opportunity for Amazon and international sellers. Cross-border ecommerce may be the future.

Last year, Alibaba's Singles Day online shopping festival raked in about $14 billion, more than Black Friday and Cyber Monday combined. Amazon hopes to expand its footprint in China, as it currently makes up less than 1-3% of the country’s total ecommerce market.

Via Business Insider

Instagram’s New Product Tags Help Users Make Faster Purchasing Decisions

Like Pinterest, Instagram is making it easier for brands and retailers to promote and sell products within its photo-sharing app. Instagram is testing a feature that lets retailers tag products within photos. Each product will then have its own detailed product page. Participating brands include Kate Spade, Warby Parker and JackThreads.

The move was inspired by internal research, finding that only 21% of consumers would buy a product they saw within the first day of discovery. According to the company’s blog, “Most mobile shopping experiences today take people from the shop window right to check out — without giving consumers the opportunity to consider a product and get more information.”

Most shoppers spend a day or longer researching an item before making a purchase. To aid this process and improve the mobile shopping experience, Instagram’s new product tags will bring important information to the viewer earlier in the shopper’s journey, all without having to leave the app.

Via Instagram Business


Albert Ong

Albert Ong

Albert Ong is the marketing manager at Jazva, an all-in-one ecommerce platform for multi-channel sellers. When not leading content strategy, Albert spends his time listening to audiobooks, writing science fiction, and binge-watching Netflix.