Dive Brief:
- Amazon has enlarged its assortment of Prime exclusive phones with an Alcatel A30 that’s $40 below retail at $59.99 for Prime members and a Motorola Moto G5 Plus starting at $184.99 for Prime members or $45 off the retail price. The Alcatel A30 marks Alcatel’s first Prime exclusive phone, according to an Amazon press release. Consumers who are not Prime members can purchase the phones at full price.
- The latest offerings expand the Prime exclusive phone program Amazon kicked off last year with two phones $50 below their retail prices: a Blu R1 HD for $50 and a Lenovo Moto G4 for $150. As reported by CNET, the lower prices are supported by ads on the devices’ lock screens. Amazon’s Kindle and Fire devices contain similar ads.
- The phones provide a streamlined sign-on for Prime users to easily access their Prime benefits, including Prime Video movies and television shows, Prime Music songs, Prime Photos storage, and Amazon Underground apps and games. Amazon noted they can also shop a selection of daily deals from a home screen widget.
Dive Insight:
Amazon’s tentacles are extending further into the pockets of Prime members. The new Prime exclusive phones are simply fresh examples of Amazon’s attempts to keep customers within the Prime ecosystem. That ecosystem is flourishing, and Prime is a significant growth driver at Amazon. There are tens of millions of Prime members around the world largely paying $99 per year for expedited shipping, and Amazon is constantly widening Prime’s reach into new merchandise categories and geographies.
The Prime exclusive phone program illustrates that Amazon learns from failure. The Amazon Fire Phone, the company’s play to become a smartphone maker, was a complete flop. So, Amazon pivoted to selling phones from established smartphone firms and developing hardware devices like its virtual assistant Alexa. Amazon’s continuation of the Prime exclusive phone program indicates its strategy shift was productive.
Amazon describes the Prime exclusive phone program as a winner. “Prime Exclusive Phones consistently rank in our best-sellers list, and are some of the most highly rated unlocked phones available on Amazon — the program has exceeded expectations,” said Laura Orvidas, vice president of consumer electronics at Amazon. Orvidas' enthusiasm could mean more Prime-affiliated phones are on tap.
Prime was born in 2005 to encourage Amazon purchases with two-day shipping. Today, shipping times for thousands of items have been reduced to one to two hours in more than 45 cities through Prime Now. The speedy shipping and multiplicity of Prime products have increased Prime usage. The e-commerce giant divulged in its Q4 earnings call, for instance, that Prime hours for video, music and reading doubled in 2016. Amazon has been rolling out Prime globally and recently introduced the service in India.