Amazon will raise the price of its Prime monthly subscription service by 12.5%, or £1, to £8.99 from September, in the latest sign that delivery costs are rising.
The company said the cost of an annual Prime package, which includes unlimited deliveries for online shopping, access to its video and music streaming services and its Amazon Fresh grocery deliveries, would increase further, 20%, or £16, up to £95. although this is still a discount on the monthly option.
Amazon said the fee increase, which will be implemented as members’ contracts come up for renewal starting Sept. 15, was the first since 2014 and came after a series of improvements in their Prime service.
“We’ve increased the number of products available with Prime unlimited fast delivery, recently added ultra-fast fresh grocery delivery, and significantly expanded our high-quality digital entertainment including TV, movies, music , games and books,” a spokesperson said. said
They added that Prime Video had tripled the amount of original content on Amazon since 2018, with series such as The Boys and The Terminal List, and UK-produced shows such as Clarkson’s Farm and Backstage With Katherine Ryan. The service has also added access to Premier League football and Autumn Nations rugby in the UK and will launch The Lord of the Rings: The Rings of Power series in September.
Half of all UK consumers over the age of 16, or around 27 million people, are believed to have access to Prime, as the service expanded rapidly during the pandemic, when high street retailers were forced to to close for long periods.
More than a third of UK over-16s, some 19 million people, are estimated to be individual members, a rise of 31% or 15 million in 2019, according to market research firm Mintel. Prime membership peaks among younger consumers, with nearly two-thirds (64%) of 16-34-year-olds now accessing the service.
Prime Delivery is the most widely used service, but the video streaming service grew the fastest during the pandemic, with 62% of members regularly using it in 2020, according to Mintel. In contrast, only 7% used Amazon Fresh’s grocery delivery service.
The price hike comes as online retailers and streaming services look for ways to offset inflation in delivery costs and growing difficulties in handling returned goods.
In March, Netflix said it was increasing the cost of its Basic and Standard plans by £1 per month to £6.99 and £10.99 respectively, while the premium tier will rise by £2 to £15.99. Apple Music is also increasing the cost of its student plan by £1 to £5.99, while the cost of Disney+ has risen by £2 a month to £7.99.
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The price hikes come despite evidence of waning interest in streaming services as households look for ways to cut costs and find alternative entertainment now that pandemic restrictions have ended.
Fast fashion group Boohoo, which owns online brands including Debenhams, Dorothy Perkins, Oasis, Wallis and Burton, became the latest online retailer to start charging shoppers for returns earlier this month with a fee of £1.99.
Zara, Sports Direct and Next also now charge for returns for items bought online as the costs of cleaning, checking and repackaging items, as well as deliveries, have soared.