Friday, February 04, 2005

Netflix competitor Amazon Unveils Loyalty Shipping Program

via The

Amazon is offering a customer loyalty program which costs $79 per year, and for which you receive free two-day shipping or overnight for $3.99. In other words, you'll break even after your ninth purchase. The article asks if this is Amazon's way of preparing to take on Netflix in the online DVD rental business.


  1. What the heck does a loyalty shipping program have to do with starting an Online DVD Rental Business?

  2. They're setting up a subscriber base, building their brand.

  3. They don't need to build their brand, they already have one of the largest customer bases in the world. That is why you don't see television or print ads often.

    Amazon got some customers, of which most are probably already loyal, to keep them there by charging them for a year, and giving them expedited shipping in return. Nothing more than hoping to keep customers away from competitors in what they sell now. A DVD Rental Service would not be tied in with Amazon Prime, as shipping DVD Movies for a rental service via a courier 2nd day service would just be suicide from a financial standpoint.