Is Amazon Prime Worth $99 A Year?

By Mike Flacy on May 25, 2014

I’ve been an Amazon Prime subscriber for a few years now. I was an early adopter, long before the retail giant started adding perks like free access to select Amazon Instant Video content or a free Kindle book rental each month. I signed up during a promotion, paying approximately $40 for my first year. Since then, I’ve paid the standard $80 yearly fee for access to Prime and I will now pay the new $99 fee for access.

To determine if it was a good deal for me, I analyzed my Amazon purchase history over the three previous years. Amazon is kind enough to provide all this data on your Order History page, dating all the way back to 2002 in my case. Specifically, I added up the cost of shipping for all my purchases each year. While I tried to take advantage of free Super Saver shipping as much as possible, I typically averaged about $65 to $75 per year on Amazon shipping costs. This usually included at least one exorbitant shipping fee for overnight or two-day shipping for a nearly belated birthday present.

When I browsed through my email order history with other retailers, it only got worse. Despite my best efforts to locate and use coupons on purchases, my total in shipping costs for all online retailers were at least $125 a year! It doesn’t look like much when getting hit with a $3.99 charge here and a $5.99 charge there, but it all adds up over time.

After tallying up my shipping costs, I took the plunge and signed up with Prime. In the first year, four things happened:

When I wanted to purchase something I traditionally bought online, Amazon become my starting point before any other retailer.
Purchases that I traditionally made at brick & mortar retailers (heavy, large or bulky items) became Amazon purchases. Why spend an hour in the store picking up something when it can be delivered to my doorstep?
I became a procrasti-shopper. As mentioned here, I longer felt the need to group items together to save on shipping or shop for gifts early to leave time for delivery.
I had to start fighting off the urge to pay $3.99 to upgrade to same-day / one-day shipping on most orders. Unfortunately, I still falter from time to time on something I want immediately.

Interestingly, my order rate more than doubled from 20 to 25 orders per year to 50 to 60 orders per year. I wasn’t necessarily spending more money per year, simply routing a larger volume purchases through Amazon rather than other online and offline channels.

Amazon Shipping Explained

The core feature of Amazon Prime is free two-day shipping on all items enrolled in the Amazon Prime program. When searching for products, you will see the Prime logo beside each item to indicate the two-day shipping is available. There’s also a filter option in the left navigation that allows you to remove all items that don’t come with Prime shipping.

If you aren’t enrolled in Prime, the free shipping option available to you has a couple caveats. You have to meet the $25 minimum purchase threshold and you have to be patient enough to wait 5 to 10 days for Super Saver shipping. However, some items, like video game preorders, offer release date shipping for free. In addition, there are site like this that allow you to search for Amazon filler items to bring up your threshold to the $25 level.

If you want your items faster, standard shipping (3 to 5 days) starts between $2.99 to $7.99 per shipment (depending on the product category) and a per item rate that varies between a flat rate and weight-adjusted rate. For instance, if you ordered this Dell computer, you would pay a $7.99 base rate plus $13.65 for standard shipping. If you want two-day or one-day shipping, the cost rises yet again.

A definite benefit to Prime shipping is not having to fool around with padding your cart with extra items in order to hit that $25 mark. Arguably, you may be able to spend less money on purchases each year if you don’t have to artificially inflate your shopping cart with Add-On items that could end up collecting dust around your house.

Two-Day Shipping Is Cool, But What Else Do I Get?

In the past couple years, Amazon has become very competitive with Amazon Prime perks. If you can’t justify spending $99 per year to cover your yearly shipping costs, you may be able to justify the cost when adding in Amazon Instant streaming video or Kindle Lending Library access.

Accessible through tablets, smartphones, desktops, laptops, video game consoles and set-top boxes like the Roku 3, Amazon Instant Video is a hybrid between Netflix, Hulu Plus and Vudu. While premium purchases are available through the service, Amazon Prime subscribers get access to tons of streaming television shows and movies.

Amazon is currently competing with Netflix for rights to television shows, so you may find exclusives on Amazon Instant Video from time to time. An example would be CBS’s Under the Dome mini-series. New episodes of the show are available to stream for free to Amazon Prime subscribers four days after the show airs on CBS. As an another example, all the seasons of Downton Abbey are currently exclusive to Amazon. Amazon also recently secured rights to stream a huge collection of HBO shows such as The Sopranos, The Wire and True Blood.

Looking at it from a monthly cost perspective, $8.25 per month for access to Amazon’s streaming video library is only slightly more than the $7.99 per month paid for Netflix or Hulu Plus. While Netflix offers a much greater depth of original content and Hulu Plus has a much broader library of recently released shows, the added benefit of Amazon Instant Video is tough to beat when combined with other Amazon Prime features.

Speaking of, if you own a Kindle e-Reader or tablet, Amazon Prime subscribers have access to the Kindle Lending Library. This allows users to borrow one book per month similar to checking out a book from a library. At the start of the next month, the user can borrow a new book. Since the average price of books in the Lending Library is between $5 to $10, that can potentially save a subscriber $60 to $120 a year on Kindle purchases.

Can I Get It For Less Than $99 A Year?

There are four scenarios that will help you reduce the cost of Amazon Prime:

Sharing is Caring: To justify a regular Amazon Prime subscription, you can share the subscription with up to four members of your household as long as they live in the same mailing address. My fiancée (different last name) uses my subscription constantly and she orders about 2x the volume of packages as I do each year. It’s ridiculously beneficial for large families and brings down the overall yearly cost if you get everyone in the household to contribute.
Off to College: If you have a student email address, you can enroll in the Amazon Prime Student program. It gives you six months of Amazon Prime for free and students can renew up to four years at a cost of $39 per year. However, you aren’t allowed to share the subscription with family members. In addition, Amazon Instant Video and the Kindle Lending Library aren’t included during the first six months.
Babies Ain’t Cheap: Ideal for new parents, the Amazon Mom program offers three free months of two-day shipping and 20% percent off diapers and wipes in the Subscribe & Save program. While it also has the same restrictions as the student version, the savings on diapers can be monumental over time.
Slow It Down: Occasionally, Amazon may provide an option to slow down your shipment in order to reduce the overall price of the order. While the savings are typically nominal, each little bit can chip away at the yearly subscription rate.

When it comes down to it, look at your Amazon order history and weigh the cost of Prime against that with the added perks and/or potential for sharing the subscription with family members. In my case, it was a no-brainer. You can always try out the 30-day free trial to see if it’s beneficial to you. In addition, if you cancel the subscription at any point during the year, Amazon will prorate the remainder of the yearly fee and refund your money.

About Mike Flacy

Editor-in-Chief for The CheckOut. During my free time, I love to write about pop culture, home theater, digital photography, social media, mobile technology and cool gadgets!

16 Comments

tom graham

February 21, 2017 at 2:18 pm

I have Amazon prime but they started some kind of gimmick called Prime Pantry.
A few weeks ago I went to order 6 bottles of Kraft cheese spread (covered by Prime original type) and some Gaviscon.
Turns out the Gaviscon was only shippable by Prime Pantry and was only free shipping if I ordered $25 minimum, and the cheese spread was NOT prime pantry eligible, though eligible for regular Prime.
I wrote customer service but got only “boilerplate’ text as a reply.
Needless to say I bought both items elsewhere.
Smoke and Mirrors!!!
If anybody wants, I’ll post both of the customer service replies.

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Angela J

May 31, 2016 at 9:49 am

I used to think Amazon was awesome because almost *everything* one could want is for sale on there, available to be on my doorstep in just 2-4 days. But now that I have investigated the company’s work ethic and found its treatment of warehouse workers desperately inhumane, I would rather pay more money and wait more time elsewhere. How selfish we have become about saving time and money at the expense of others!

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MikeA

March 30, 2016 at 8:12 am

I used to think Prime was great and tried making Amazon my “one-stop-shop” also, until they pissed me off with annoying changes to their website and a preapproved card that wasn’t preapproved. After that I decided that I would cancel Amazon prime and seek other on-line retailers for my purchases before going to Amazon, which is now my last resort.

Since doing this I have actually saved tons of money. What I found is that the Amazon prime items are heavily marked up to compensate for the free 2-day delivery. For instance, a bed frame in my Amazon cart was at $519. I got the very same frame it at Wayfair for $240. This has been the case with pretty much everything from Amazon that I found on other sites. Yes I’m doing without the 2nd day air on the other sites, but considering the savings, I can pay for the 2nd day air and still save money over what I was paying at Amazon with free 2nd day air. I’m still using Amazon for items that I cannot find elsewhere and I don’t miss Prime Video, which really sucked and was useless anyway.

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- Tracee Arsena
  
  February 6, 2017 at 2:19 am
  
  I compare pricing and can almost always find things cheaper on Amazon including my premium dog food. A few dollars less and huge bag delivered to my door. Their premium treats are seriously half the price of the pet food store. Not to mention, if you can think it, you can find it on Amazon.
  My daughter bought me the Fire stick during a sale because I really wanted to watch The Man in the High Castle. Love it. There’s a couple others that look good too.
  I try to make up for my love of Amazon by shopping local frequently too.
  
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john malvern

December 30, 2015 at 9:18 am

I have received notice of a payment via Barclaycard
dated 21st December to amazon prime and am unaware of
what was bought.

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USAMaid

October 14, 2015 at 11:36 am

Amazon is following the Walmart model. Keep prices low until you have people hooked, then raise them so you are now more expensive than a small store! I caught on to the Walmart thing a long time ago. They are more expensive than a supermarket in a lot of food items.

Now to Amazon, where the kibble I buy for my five dogs is $79.95, as opposed to $47.95 in a small pet supply store with two brick and mortar locations. How does that sound to you? I’ve complained several times about this, to no avail. I found the 28# bag of kibble two weeks ago on Amazon for $39.95, through an Amazon seller. Now that seller is no longer available for the kibble.

Bezos went wild with distribution facilities and sacrified a lot of profit because of it. Now he’s trying to make up for his stupidity over his customers’ backs. I no longer order from Amazon without doing an online search first. Screw me once, shame on you…

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- Nobody
  
  October 16, 2015 at 12:52 am
  
  Did you really think it doesn’t cost them anything to ship 28lbs of dog food? Prime or not, they have to charge more to make up this difference, and often people are just seeing something from a 3rd party seller and assuming falsely that they were supposed to get free shipping discounts because of prime when the product isn’t coming from an Amazon warehouse because it’s not “fulfilled by amazon”.
  
  Food, naturally it’s not cost effective to mail in small quantities instead of a truckload at a time to a grocery store, but you can often save a little bit if you buy say a dozen+ at a time of the exact same canned goods product.
  
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- Colleen brillhart
  
  June 25, 2016 at 1:28 pm
  
  Only about 25% of my purchases online were 2 day shipping and there were minimal updates to Amazon movies . So I will not renew my contract .
  
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Eric SD

February 17, 2015 at 7:47 am

I’ve been a Prime member for a couple of years now and their service seems to be getting worse lately. I use my membership for the 2 day shipping and also the Prime video. I would say the 2 day shipping is hit and miss. Most shipments take 2 days while the rest are more like 3 or 4 days. The biggest issue I’m having now is the free Prime videos/shows. Stuff I have watched on Prime for free, I now have to pay for?!? Examples: Watched first 2 seasons of Duck Dynasty for free a couple of months ago, now I have to pay for those seasons and any newer ones. 2 years ago at Christmas, National Lampoons Christmas Vacation was free to watch. This last Christmas you had to rent it for $4.99.

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VA Mom

January 24, 2015 at 1:31 pm

Not anymore! If you have used Prime 3 or 4 times, you can no longer get a refund of any amount, even if you have 11 months left on the year.

Today they are offering $72 membership but only for NEW subscribers). Those of us who have been loyal for years are stuck paying $99 for our year.

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Ben Den Houter

December 9, 2014 at 2:41 am

I am a Amazon Prime member and I love it! I use it all the time to buy my auto mechanic tools.

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Mark

July 15, 2014 at 9:07 am

I’ve had Prime for about 10 months now. Mine was set to expire in August, but due to shipping problems I’ve had a total of 5 months added. They were always the fault of the shipper. The worst was a failure to deliver by Christmas Eve. One was delivered on time but to the wrong place (an RV park owned by the same company in the same town). However, I do a lot of shopping on Prime. One of them was due to the fact that they used a regional shipper (Lone Star Overnight) who wouldn’t deliver to my neighbor even though I left a note with my signature.

That said, I use Prime all the time. I purchase a lot of things on Amazon I would normally purchase locally due to the free 2 day shipping. It saves me a lot of money. I use the streaming and have looked at the music. However, with the price increase, I’m debating about whether or not to keep it. I’ll have to do the math and see if the savings on shipping over the year vs. buying locally would still save me money overall.

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Haley

January 16, 2014 at 8:42 am

I was hesitant but then I decided to sign up for Prime and now I can honestly say that it’s totally worth it. It’s quite convenient for me, I buy a lot of stuff from Amazon, this is also the main reason why I’ve been looking for a why to manage better my online purchases. I’ve come across a web app an Amazon tool that let you create a digital inventory of your belongings along with their docs such as receipts, warranties or manuals. It’s clever and it’s been quite useful to me so far.

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Mark

December 24, 2013 at 9:28 am

I’m a Prime member. While I enjoy the instant streaming, I purchased it for the purpose of the free two-day shipping and the discounted overnight shipping. It seems that in recent years the program has been oversold and they are unable to fulfill their shipping obligations. I’ve had more failures than successes in terms of shipping times this last year–even with upgrading to overnight. One time the package sat at the amazon dock for two days (after marking as shipped) and it took an additional 4 days to arrive since it was shipped SurePost and USPS fumbled the final delivery. I know I’ll be told to allow more time. However, I use Prime instead of buying locally for a lot of things and time things in that way. I’m considering ending my long Prime membership after this disastrous year.

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- [email protected]
  
  October 23, 2015 at 8:55 am
  
  As for deliveries, I run into the same problem. One of the reasons I became a prime member was for the 2-day shipping. However, even though there is a warehouse 32 miles from my house, Amazon still ships packages of certain weights or sizes first through UPS but if the package is small enough they hand it off to the local post office for devlivery and that adds an average of FOUR additional days to the delivery. I could walk to the warehouse and pick the package up my self faster than they deliver. And just to make sure it is clear; yes, these are Amazon Ptime items sold and “delivered” though Amazon Ptime and not a 3rd party reseller.
  
  Also, one advantage I had as an Amazon Prime member was that I didn’t have to pay sales tax which was a big savings on big ticket items especially. Tje opened a warehouse in my state (CT) that has no showroom or sales floor of any kind – so it isn’t like you can go in and purchase anything – however, just because the product is located in my state they can now charge the 6.35% sales tax we have here in CCT as of 2015. I might understand if you could go to the facility and actually purhase something but that isn’t possible and as a I already stated, they are 32 miles from my home and using Prime it has taken over a week and a half to receive things between UPS and things being handed off to the post office for final delivery.
  
  As for prices; they are still the least expensive on some items but I also searh the internet now for better prices and am finding better orices more and more elsewhere.
  
  As for Amazon’s video, I have found the same thing as others: shows (movies OR TV) that use to be free now have to be rented. If you do searches they just seen to be filling out there library with old B movies…quantity is NOT quality. I watched the first 4 seasons of Teen Wolf for free (they currently as of – still are free) however season 5 (which is a oompleted season) now costs Prime members to view. Another old trick; get a viewer hooked on a series then charge if they want to keep watching it. Shady and unprofessional. Well, that’s another one of those things the internet an be used for – and it’s free, just takes little more work. But for what they want to charge for additional seasons of a show they got ou hooked on it’s worth a few minutes of internet searching.
  
  The price has gone up and the quality has gone down. I received an Echo/Alexa as gift and like it the only problem is that without a Prime membership it’s almost nothing more than a paperweight. There are promises of what it will be able to do in the future. It will be interesting to see if it comes true or not.
  
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Caleb Vander Ark

August 20, 2013 at 2:16 pm

I have Amazon student, and the $39/year gets me the prime videos and other stuff too. It’s only for the 6 month trial that they don’t give you the extras.

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