Photo by Venturebeat courtesy of Creative Commons.
Kieron Williams/Staff Writer
Amazon has long been known to the business world as an unexplainable phenomenon. The company has increased in product, sales and revenue nearly every quarter for the past 10 years, but has yet to make any kind of tangible profit.
However, despite this lack of return, investors have inexplicably held steadfast to Amazon shares, according to International Business Times.
Investors have kept an eye on the increasing industry revenue, watching Amazon take business away from rivals both online and offline. While they may have felt that the company has been stringing them along, Amazon may have chosen 2014 to capitalize on their share of the market.
Amazon’s chief financial officer Thomas Szkutak told the New York Times that the company plans to increase the price of their Amazon Prime shipping program by $20 to $40, a 50 percent increase from its original price.
With an estimated 25 million Prime subscribers, the price increase could lead to an immediate boost in profit for the company. But are Prime subscribers willing to lose the old customers-before-profit Amazon?
Henry Doce, senior psychology major and avid Amazon customer, doesn’t seem to mind.
Doce uses Amazon Prime to buy electronic equipment and accessories and says he has never received a late package.
“I’ve pretty much replaced Best Buy with Amazon,” he said. “Even with the price increase, I’d still be saving a substantial amount of money with the free 2-day shipping considering the amount of purchases I make in a year.”
“Even with the price increase, I’d still be saving a substantial amount of money with the free 2-day shipping considering the amount of purchases I make in a year,” said Henry Doce, senior psychology major.
Although Amazon’s new price increase on Prime is out of character for the company, the the prices of their products aren’t changing.
Even if one of their services is more costly, they will still have competitive prices on everything from apparel to electronics to textbooks. And when compared to Barnes & Noble, it may even be safe to say that a student with an Amazon Prime subscription would save more money than a student paying for their books on campus.
One can compare Amazon prices with the Barnes & Noble College website to find the prices for the used textbooks of some typical freshman courses: ENC 1101, College Algebra, SLS and Spanish I.
The combined price of all the required books through the campus bookstore website came out to $509.75 with tax, and that’s including package deals that come with necessary online access codes. The two most expensive books on the list were the Dicho y Hecho package for Spanish I that cost $107.15, and the Algebra+Trig package that cost $182.90.
Each textbook can also be found on Amazon—even the FIU-specific SLS book.
Some of the packages that contained the textbook and online access code at a cheaper price could not be found, so their components had to be added separately. But even with that disadvantage, the difference is a staggering: $360.17 with tax. Every single book was found at a cheaper price than their Barnes & Noble counterpart, the biggest price difference being the Dicho y Hecho package that went from $107.15 to $39.94.
Amazon would have to increase the price of Prime by almost double just to cost the same as Barnes & Noble, and even then the advantage of 2-day shipping would still put it over the edge.
Although Amazon is taking an aggressive step forward to increase their profit margin, it may be more harmless than it appears to be on the surface.
“Even if they increase the price, I’m still saving money when I’m shopping with them,” Doce said. “That’s what matters the most to me.”