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An Updated Look at US Amazon Prime Membership
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We have tracked and estimated US Amazon Prime membership for ten years, more than half of the program’s 18 years of existence, and definitely its most exciting period. As we reported over the past several months, our data shows that Amazon Prime membership in the US has reached a plateau.
We update our estimate each quarter, based on our new survey data and public figures from Amazon. When Amazon Prime membership grew rapidly, our estimates showed the magnitude of those quarter-over-quarter and year-over-year increases. In this most recent period of slow or no growth, the slight variances in our estimates fall within the margin of error of our calculations.
So, as the quarters pass, it becomes increasingly clear that at least in the US, growth in membership in Amazon Prime has flattened. CIRP estimates both the total US membership and the penetration into the total Amazon customer base. Recall we look at the number of individuals with use of an Amazon Prime membership, rather than the number of paying Amazon Prime households.
CIRP estimates 167 million US Amazon customers had a Prime membership as of the March 2023 quarter. This is essentially unchanged from our 170 million estimate for the March 2022 quarter (Chart 1).
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Chart 1: Amazon Prime membership and penetration (figures as of the indicated quarter)
The share of Amazon customers that are Prime members has also leveled off, at approximately 70%. As of the March 2023 quarter, 71% of Amazon transactions were made by Prime members, similar to the 70% in the March 2022 quarter.
US Amazon Prime membership growth had started to slow in the 2019-2020 period, only to rebound during the COVID-19 pandemic period. That rebound may have been the last significant membership bump for Amazon Prime in the US, as it may have finally reached the theoretical and practical limit. The return to in-person shopping and current economic uncertainty put further pressure on membership. Amazon Prime of course adds new US members each quarter, but now, just enough to sustain the member count. This is a far cry from the years of double digit growth.
It is of course a little less exciting to track a relatively flat number such as this. Still, as we have seen from Netflix, Costco, and other subscription businesses, it is critical to keep an eye on this key metric. It does sometimes decline, and can be a leading indicator of impending challenges. That is not the case for Amazon in the US this quarter, but we’ll keep watching.