Is Amazon Prime Really Worth It?

I saw a funny commercial recently where a couple was made fun of for having too many subscriptions, and it startled me into taking a look at my own subscriptions and memberships. And boy, do I have plenty.

While Netflix, Plum Plus, and even my library card (even though it’s free!) are purely for entertainment purposes, certain memberships make sense for lots of reasons. Just look at Costco – a perfect example where paying for a membership can be worth it for thousands of Canadians.

The Amazon “Prime effect” is no different. For some, their membership has metamorphosed into a marriage contract of sorts; we’ve become increasingly loyal and spend more quality time (read: money) on the site – especially since Covid hit. Some of us just might not realize yet how committed we are.

The “Prime Effect”

It turns out that I am a perfect example. To investigate, I looked at my Amazon order history and decided to crunch some numbers.

• In 2016, I didn’t have Amazon Prime. I thought of Amazon as the last-resort for cheap items I didn’t want to pay a higher retail price for at brick-and-mortar stores in my town, or for items I couldn’t find nearby.
• The total money I spent at Amazon in 2017 was $744.03.
• In 2018 I got Amazon Prime. I then spent $1,499.37.
• And in 2019, I spent $1,723.32.
• Then came the pandemic. I won’t go into how much of my money Amazon has received since the first lockdown in 2020.

By looking at how my spending has increased, it’s clear to me that I no longer see Amazon as my last resort. It’s become my go-to for pretty much anything, and I’ll only shop somewhere else if Amazon doesn’t have what I’m looking for, or if I’m (somehow) in the mood to walk around an over-lit and over-crowded mall.

And since I’m paying around $80 per year for it, I know I’m going to shop there first to make my investment worthwhile.

I used to buy things like board games at Toys R Us, books at Indigo, and work clothes at Mark’s…but now all of that money is going into Amazon’s pockets.

Amazon Prime – Is It Worth It For You?

With all that being said, is Amazon Prime worth the subscription fee? Let’s take a look at what this service has going for it.

Speedy 2-Day Delivery

Perhaps the biggest perk of having an Amazon Prime membership is free 2-day shipping, with some regions even eligible for same-day delivery.

If speedy delivery time is your biggest concern, Amazon Prime could be a blessing, although not all items are eligible. So it’s a gamble – will the item you’re looking to purchase qualify for 2-day shipping? If not, is it really worth it?

Amazon Prime Video, Amazon Music, and Amazon Reading

Amazon Prime Video

In addition to giving you fast and free shipping, your Amazon Prime membership includes their Prime Video streaming service, which is like Netflix, only with (mostly) different options. In the last couple of years, to compete with the myriad of other streaming options that have popped up, they have also started investing lots of money and resources into creating original shows and movies for this service. If you use video streaming services, then this alone could make the subscription worth it.

Amazon Music

Similarly, Amazon Prime members receive a subscription to Amazon Music too. The complimentary version of Amazon Music is similar to Spotify: there are limits to how many devices can use it at once, and certain content that’s only available for those willing to pay a few dollars more. They’ve got a leg-up on Spotify in one area, though, as the free version of Amazon Music Prime doesn’t have any commercials.

Amazon Reading

Many people don’t realize it, but your Prime membership also gives you access to a rotating list of ebooks, including comics and graphic novels. You’ll need either an internet browser, Kindle device, or another device where you can download the Kindle app, but the app is free. Members can borrow 10 of these titles at once, and (as far as I can tell) there’s no due date. If you were to buy even just one paperback title, not a new release, it can cost over $15.

Membership Cost Breakdown

An Amazon Prime subscription is currently $7.99 a month, or a flat annual fee of $79. If you’re a Canadian paying monthly, this works out to just over $95 a year, before taxes.

That’s almost $100 a year, which feels like a lot. But let’s take a look at what you get, and how other options compare. For this we’ll assume we’re only ordering 1 book-sized item from Amazon per month.

You can see that Amazon Prime is a steal of a deal if you actually use it to replace other music and video streaming subscriptions.

If you’re keeping those other subscriptions, however, the free shipping may not be worth it on its own, unless you’re having things shipped relatively often.

What Does This Mean for the Competition?

We’ve already seen the impact Amazon has had on local bookshops and small retailers, and it hasn’t been good. Amazon is also constantly expanding its reach with things like its video streaming, music streaming, and ebook services. They’ve expanded into grocery delivery too, through their acquisition of Whole Foods, and recently they bought out MGM – signaling their ongoing commitment to expanding their entertainment services. I’m sure their expansion is far from over. Almost every industry is starting to feel the pressure from Amazon’s competition.

It’s easy to see how an Amazon Prime membership leads to increased loyalty and spending. With guaranteed free delivery, low prices, and easy returns, most members will default to ordering most things from Amazon as a matter of course. The added free streaming services are just a bonus, giving members a way to save money by cancelling other, competing subscriptions.

I’m sure they’re not finished expanding what Amazon Prime has to offer. So, judge for yourself the value for yourself and your family, but at the end of the day, if you make full use of what it already includes, it’s a pretty clear way to save some money.