Is Amazon Prime worth it? It’s been almost one year since I decided to sign up for Amazon Prime, so I thought I’d crunch the numbers to see if Amazon Prime membership has actually saved me money. Soon, I’ll need to decide whether to renew my $79 per year account.
My first experience with Amazon Prime was actually a few years ago when I signed up as an Amazon Mom member. At the time, I could receive free Prime shipping for three months, which would be renewed for another month every time I made a mom-related purchase within the prior month (for up to one year).
I shopped so little on Amazon back then, that my free Amazon Prime membership lapsed. I realized that if I didn’t use it enough then, I wouldn’t use a paid Prime membership often enough to justify the cost.
However, I decided to purchase an Amazon Prime membership once I was pregnant with my younger son last year — I was shopping a lot more on Amazon, and it was annoying planning my purchases around the Super Saver Shipping threshold. When Christmas came around, I didn’t like to worry about whether shipments would arrive in time.
Does Amazon Prime save on shipping costs?
I looked over my Amazon orders for the past year and found that I had placed 30 shipped orders (I’m not counting digital orders, or e-gift cards that wouldn’t incur shipping costs).
Most of those orders were baby-related: buying supplies to prepare for his arrival, and monthly shipments of formula since he was born. My purchasing volume will probably be less in the coming years.
If I considered how much it would cost to ship all of those orders in two days without Amazon Prime, then I am saving a lot of money. But who pays extra for two-day shipping on every order? Certainly not me. I always opt for the free shipping if I can, or pay for the slowest, and cheapest, shipping method. Is Amazon Prime worth it if I wouldn’t pay for premium shipping services, anyway?
Amazon offers free Super Saver Shipping for orders over $35 (up from the $25 threshold they had in previous years), and of my orders from the past year, only 13 would have incurred shipping costs if I was not a Prime Member. In calculating my shipping savings, I did not consider what two-day shipping would have cost, but instead looked at what the cheapest ground shipping would have cost for my orders that were under the $35 Super Saver Shipping threshold.
The Amazon Prime cost is $79 per year, and shipping those 13 items would have cost me around $70 (based on current Amazon shipping rates). Amazon Prime has not actually saved me any money on shipping.
Other Amazon Prime Benefits
Two-day shipping is one of the main Amazon Prime benefits, but Amazon also pushes two other perks that may make Amazon Prime worth it for some.
Free Instant Video Streaming
Amazon offers a robust selection of videos for streaming, and they make a portion (over 40,000 titles) available for free to Amazon Prime members. Back when I was initially trying to decide whether or not to sign up for Amazon Prime, everyone said “don’t do it for the instant video”. I heard it was a good perk, but not an alternative to Netflix.
We are very light Netflix users in our family, and I actually think that Prime Instant Video could be a viable replacement for Netflix in our household. All of the things we watch are also on Amazon Prime, and my husband has found some things he’s interested in that are on Amazon Prime, but not on Netflix. I also like that we can rent other titles for a fee that aren’t part of the Amazon Prime selection–a few rentals here and there cost less than paying monthly (and waiting) for the additional DVD service at Netflix.
We still have a clunky old TV, so it doesn’t matter to us whether the HD streaming is up to par with Netflix, and there are Amazon streaming apps for our Nintendo Wii and iPad that work great. Netflix costs us $96 per year. If we use Amazon Prime Instant Video instead at only $79 per year, we could save that $96. So far that’s the most compelling reason to renew my Amazon Prime membership.
If you’d like to test out the video selection before making a decision, Amazon is offering a free 30-day trial of Amazon Prime which comes with all the perks, including the free video streaming.
Free Kindle Lending Library
Amazon also offers a free lending library of select e-books (more than 500,000 titles) that Amazon Prime members can share among themselves. The free Kindle Lending Library sounds like a great perk, but I can’t use it because I don’t own a Kindle. Even though Amazon makes a great reading app for my iPad, I can’t take advantage of the lending library. It’s a disappointment, but I rarely have time to read these days, so it wouldn’t be worth all that much to me anyway.
I’ve read mixed reviews about the Lending Library, and many users say the selection isn’t all that great. I think it’s a nice feature if you do have a Kindle, but probably not one that should influence your decision to pay the $79 Amazon Prime cost.
How much does shopping on Amazon.com save?
It was a little disappointing to realize that I wasn’t actually saving money on shipping (even if I missed by only $10), but was I losing money by paying for Amazon Prime? On the contrary.
I did the math and found that I had saved a whopping $439 by shopping on Amazon. And I’m talking real savings, compared to other store prices, not inflated suggested retail pricing. That more than makes up for the $79 Amazon Prime cost. Of that $439, I saved $304 on necessities like baby formula, diapers, toiletries and cleaning supplies that I absolutely needed to buy.
I used the Subscribe and Save program along with Amazon Mom to get 20% off subscription-based products, and I had a few big wins from the Amazon Warehouse Deals store where I found like-new products that just had damaged packaging.
My Amazon Prime membership enabled me to donate needed items to others on short notice as well. For example, I sent a needy family a book for homeschooling, and found a box of thermal laminating pockets for my son’s teacher in Warehouse Deals for 42% off. I didn’t pay extra for shipping, and the recipients got what they needed quickly.
Being an Amazon Prime member has definitely encouraged me to shop more often on Amazon.com, and with the amount I save, I come out ahead even after I pay that $79 annual fee.
Is Amazon Prime worth it?
I’ve concluded that, for my family, Amazon Prime is a luxury. But it’s a luxury that I’m willing to pay for. Amazon Prime doesn’t save me money on shipping costs, but I can get items I need for cheaper, and in only a little more time than it would take to go to a store.
I am less stressed around birthdays and holidays knowing that I can stretch my shopping deadline a little bit, or order affordable gifts on short notice. With two little boys to take care of, I can’t really put a price on that convenience.
As an added bonus, Prime Instant Video can take the place of our Netflix subscription, which will save another $96 per year.
So, is Amazon Prime worth it? I’ve decided that, for now, the $79 Amazon Prime membership is a great deal for our family. If Amazon does hike the fee by $20 to $40 like they are contemplating, however, I may reconsider.
Image sources: Amazon boxes, UPS trucks, dollar bills
Hi Jen – why can’t you use the Kindle Reading app on your iPad? I’ve been able to borrow free books from Amazon’s library and I don’t have a Kindle.
Hi Sam! Maybe I’m overlooking something? I have the Kindle app on my iPad. When I click through to lending library eligible books, my only options are to buy the book, or download a free sample to my iPad. And there’s no means to browse or search the library from the app itself (that I can find). Amazon says in several places that you have to use a Kindle device to borrow Lending Library books. I have read purchased books and free books with the Kindle app, and it works great.
(The free books being books that were free to keep, not borrowed)
I mainly keep Amazon Prime for convenience. It’s nice to be able to do most of my non-perishable shopping online and know that delivery is only 2 days away. I highly doubt that I save money on it, and in fact, I bet that Amazon Prime made it easier for me to buy things that I otherwise may not have purchased.
The convenience factor is definitely a major draw. I would happily pay a little over $6 per month to avoid a few store runs.
Hi Jen,
I read this with interest since I use Amazon Prime a lot. I loved that you too the time to do all the math. Too bad it didn’t turn out to be a big savings, but at least your knowledge can help shape future decisions.
Thanks for this thorough analysis,
Amy
Thank you for reading, Amy. My husband gave me the go-ahead to cancel Netflix, so at least the video streaming aspect will save us some money.
I’ve debated this myself after canceling a similar service that offered me free 2 day shipping. I can’t even remember the name of it now.
My dad gets Amazon packages pretty much weekly with his hobbies and is a Prime Member. He swears by it and the ease of return policies.
He hasn’t taken advantage of streaming movies nor kindle downloads. I have to tell him about that if he isn’t aware.
Shoprunner, maybe? I have that as well because I was able to get my membership for just $1. I wouldn’t pay full price for it, but it was nice when I was Christmas shopping.
Thanks for visiting!