Amazon targets teen market with new app-based program
Teens ages 13 through 17 years old can now shop or stream content on Amazon with their own login through the e-commerce giant’s mobile app, Amazon announced on Wednesday.
Parents do stay involved: When their teen places an order on the Amazon App, parents will receive a text or email showing the item, cost, shipping address and payment information. They can then approve the order by text, visit their page to review it in more detail, or set blanket approval by default. Parents can also choose to skip the approval step and set pre-approved spending limits.
Parents who are Prime members can share some of the perks with their teens and choose a payment method and shipping addresses for their teens — who would have their own user name and password — and then download the Amazon App to start shopping.
Not content with building up the scale of their sticky Prime membership just among adults, Amazon is clearly hoping to also capture some early loyalty from their teenaged children. The e-commerce giant has been accomplishing the same thing with their operations at many college campuses, where students can access Amazon orders at pickup locations.
It’s smart to forge ties with younger consumers, who could end up as lifelong Prime members after experiencing the perks and convenience of a Prime membership. It's also smart for Amazon to cultivate and grow these members, who spend more annually with Amazon — about $1,300 per year, compared to about $700 per year for non-members, according to Consumer Intelligence Research Partners.
There’s a lot of speculation about the size of Amazon’s Prime membership because the company doesn’t disclose that itself. CIRP pegs it at 85 million U.S. members, though Moody’s Investors Service this summer called into question that oft-cited estimate, calling it "seriously overstated," "highly improbable" and made "in the absence of any real guidance from the company itself." Moody’s analysts, based on an evaluation of demographic data, think the figure for Prime members is closer to 50 million, well below Costco’s 86.7 million members.
In his statement on the program, Michael Carr, vice president, Amazon Households, positioned the teen program as another Prime benefit. "As a parent of a teen, I know how they crave independence, but at the same time that has to be balanced with the convenience and trust that parents need," Carr said. "We’ve listened to families and have built a great experience for both teens and parents. For teens who have a parent with a Prime membership, they can also access Prime benefits at no additional cost, including fast, free shipping, Prime Video and gaming benefits with Twitch Prime."
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