We are in the middle of the holiday shopping craze. This week is Thanksgiving and Black Friday is right on its way. On top of that, Cyber Monday starts the week after. This is the week of deals and steals. People will be shopping their minds away until they literally pass out. While I’m not a big Black Friday or Cyber Monday shopper, I don’t mind getting a good deal when I shop. As most of you know, I love Amazon. I do most of my shopping there. I’m also an Amazon Prime member. There was a time when I thought that I wouldn’t renew my prime membership because it jumped in cost. It went from $79 to $99. Now, I haven’t paid the $99 yet. My membership renews in February. After this year, I thought I was done. Well, it looks like I’m keeping it for another year and will pay the $99. I always see people wondering if Amazon Prime is worth the money. Well, I’m going to break it down with math this time. Remember, everyone’s situation is different and you need to do the math yourself.
Is Amazon Prime Worth the Money? – A Mathematical Approach
I’m not tackling this by an emotional approach or a convenience approach. I don’t want to get into that, especially when math works just fine. As we gear up for Christmas, I can easily gauge what it would cost me for shipping if I chose what Amazon gives me in my Prime membership. Remember, for $99 a year, you get unlimited free two-day shipping on anything prime eligible. There are millions of items prime eligible. You also get access to Kindle sharing, Amazon instant video, Amazon Prime music, and other services which Amazon provides. They are also now testing out the ability to check out and use your two-day shipping benefit on other websites. That would be awesome. This breakdown is just going to deal with the two-day shipping as that is what’s easily calculated.
I placed 11 orders this year so far. While not much, I haven’t done my holiday shopping yet. I plan on placing a few more orders, not all at once as I know there will be deal staggered across the holiday season. I also have some regular items I need to purchase. Here is a breakdown of my purchases, just what it would cost for two-day shipping had I not been an Amazon Prime member. These are just two-day shipping charges and nothing else like taxes. Since Amazon has a distribution center in our state (or will soon), we pay sales tax.
| Order | Amount I Paid | Amount I Could Have Paid | Savings |
|---|---|---|---|
| 1 | $7.18 | $13.22 | $6.04 |
| 2 | $7.18 | $13.98 | $6.80 |
| 3 | $7.18 | $15.35 | $8.17 |
| 4 | $7.18 | $7.98 | $0.80 |
| 5 | $7.18 | $16.43 | $9.25 |
| 6 | $7.18 | $17.61 | $10.43 |
| 7 | $7.18 | $77.78 | $70.60 |
| 8 | $7.18 | $52.67 | $45.49 |
| 9 | $7.18 | $10.34 | $3.16 |
| 10 | $7.19 | $11.46 | $4.27 |
| 11 | $7.19 | $9.98 | $2.79 |
| Totals | $79.00 | $246.80 | $167.80 |
Now, you are probably wondering why there are shipping charges in the “Amount I Paid” column. Well, the two-day shipping is not really free. It costs you the amount of the Prime membership. Since I paid $79.00, I just divided that amount by the number of orders I placed. This makes the math a little easier to look at. You might also ask how I got the shipping charges since I’m already a Prime member. It was hard to do in my account, but I remembered my wife has an account which she doesn’t really use. She’s not a big online shopper, but has a Kindle, so she has an account. I haven’t shared my Amazon Prime benefits with her yet, but I could. Luckily for me, I hadn’t yet. I found each item I ordered and went through the checkout process as normal. Before I placed the order, I was able to get the charges for two-day shipping. That’s how I arrived at these numbers.
So, Is Amazon Prime Worth It?
For me, yes it is. You can see that I saved quite a bit of money on shipping charges. $167.80 to be exact. That’s nothing to sneeze about. This was how much it was including the Prime membership costs. Now, I know there are some of you saying that Amazon already has free shipping for orders over $35. Yes, they do have free shipping, but it’s not two-day shipping. I can place an order on Monday and have it on Wednesday. There have been times when I would get the package the next day. I’m going to speculate that Amazon puts Prime members in the front of the shipping line. This means those who have free shipping, standard shipping, and super saver shipping are going to be last out of the warehouse.
A few years ago you could order many things on Amazon without Prime and get it two or three days later. That has slowly changed. I think Amazon might be using their shipping speeds to force people to get Prime or at least speed up the sign ups. For me, Prime works and I like it. I also use Amazon Instant Video and Prime Music. I get those services with my membership, so it distributes out my costs. I’m also not done Christmas shopping yet. I plan on saving another $13.86 on this Zombie Cajun Hot Sauce Basket, which I put on my “ten Christmas gifts for him under $35” list.
Knowing that I will be using my Prime membership next year as well, I’m sure I will also win on the shipping savings. I can’t answer the question “is Amazon Prime worth it” for you as each person’s situation is different. I know many people who use the hell out of Prime and save a ton of money on shipping charges. I saved a lot of money on shipping a safe and a dehumidifier. Those would have cost me a pretty penny shipping from another store, even on Amazon.The best advice I have on Amazon Prime is try it out and see if you like it. Yes, it costs $99, but if you shop there a lot and would love to watch movies and listen to music and any other features they plan on releasing, then it might be worth it. Do the math!
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If you order a lot from Amazon this program is definitely worth it, not just for the holidays.
You are correct!
With those perks, I’d definitely be an Amazon Prime member. It seems like it is really worth it.
The math really helps you understand if it works for you.
Nice mathematical evidence with the shipping savings. For me just getting the free movies, music, and ebooks would almost be enough to strongly consider it.
I like the other perks as well, but the shipping savings are really what help you understand what you’re getting!
Excellent! I love when people actually run the numbers for themselves. This is what personal finance is, and somehow people still sometimes overlook this.
This definitely seems worthwhile for you based on this analysis. I’m going to perform an analysis myself this afternoon, but in the UK, I’m not sure it will be worthwhile as you get free 3-5 shipping as standard for most purchases.
However, it’ll be good to go over the last year of purchases and see if it would have been worth it…
You can get free 3-5 day shipping on most purchases as well. Since I can only compare what it is for two-day shipping as that’s what you’re paying for, then it works. You also get access to all the other services in Prime.
I have Amazon Prime and I LOVE it! We actually cancelled Netflix because we liked Amazon’s offerings more, especially since they added HBO shows. I haven’t run the full analysis like you, but if I just compare Netflix vs Amazon Prime, then it’s definitely worth it to us.
I still have Netflix and Prime. Since I don’t have cable, I’m still paying much less per month than I would be.
I love your approach on this! It looks worth it!
Thanks!
I got Amazon Prime free last year with my AMEX gold card. I loved having it, but I probably won’t renew. I don’t shop online enough to save much, unfortunately.
Well, that makes sense. You need to shop online enough to make it work!
I love Amazon Prime, and sharing a membership makes it even more affordable!
Yep, sharing the shipping benefits is awesome!
Our subscription is up in January, and I’ll probably renew. I like to buy household goods and dog food on Amazon, and it would be pricey to ship dog food. I’m sure my UPS man hates me. I have noticed the option of selecting slower shipping for $1 Kindle credit. I have been doing that when I can because Kindle books can be a weakness for me!
Yes, when you can buy large items and heavy items and pay very little for shipping, then it makes sense. That is how I got my safe and de-humidifier. Those would have been expensive without Prime!
We had Amazon Prime for a few years when the student version was free and it was nice to have the quick delivery, but we won’t pay for it at this point. Either I need something NOW and I get it in-store or I can wait a week – no need for 2-day shipping. I really can’t remember the last time I paid to have anything shipped from Amazon. This is our first Christmas in a while without Prime, though, and I do need to remember to get my orders in early!
I hear you there. Most things I order I can’t find in the stores, plus I hate shopping at any time of the year. I really do hate shopping!
I did the same calculation when I added prime and realized it was worth the money. Plus I LOVE the streaming videos and free Kindle books.
That’s great to hear Tre! Doing the math is easy and helps you know if you are getting a deal or not!
Very nice to see the math on it Grayson! I’ve gone back and forth on getting Prime and think it’s time for us to pull the trigger on it. I hate going to Wal-mart enough that I’m willing to fork over the money and having the movies/books seals the deal for me.
Eww…Walmart! Prime is worth it just for that!
I’ll definitely be paying $99 for Prime. I love being able to buy 40lb bags of cat food and cat litter that are delivered (FREE) to my door!
Heavy items help you make up for the price quickly!
I like the way you wrote out the costs because it makes a lot of sense that way. My husband has Prime through his student email, so we often use his account for ordering. I’m still not sure I can justify the cost when his membership is up. My mentality is that I just have to shop well in advance and save up items until I hit the free shipping threshold. Prime is a neat feature though- I can’t argue with that.
I typically buy my items when I need them, so I don’t have a running list of things until I hit the free shipping threshold. This is just how I do it though.
I am an Amazon Prime member and it definitely adds up to serious savings for me. I shop Amazon for everything from toiletries to furniture. I also like the free movies and prefer to service to Netflix.
Me too Sunshine! I buy almost everything from there, or at least check it first.
Wow, good choice that you are an Amazon Prime Member! Getting a less of $167.80 is totally a big savings@
I was happy to see those savings!
For us, it is totally worth it. We buy a bunch on Amazon and most times we wouldn’t hit the free shipping requirement. Plus, we take advantage of the free Prim movies they offer so that saves us a ton of money. They may not have the newest movies, but they have a lot that I’ve never heard of and are pretty enjoyable to watch.
I’m the same as you Jon. I don’t hit the free shipping threshold all of the time, nor do I bundle up my purchases to hit it.
Not sure if Amazon is putting a buffer just for Cyber Monday or if there will permanently be a 1-day buffer but I ordered an item this morning (Monday) and had a guaranteed delivery day of Thursday with Prime 2-day shipping. I definitely expected it to show Wednesday like you mentioned in the article and like I’ve experienced myself. I ordered a few items and some were shipped separately, so it’s not as if there was a specific cut-off for a particular item–nope, just a blanket extra day than before. I hope the buffer goes away soon!
Also, next to the one-day shipping option the promised day was tomorrow, Tuesday. Yet two-day shipping equates to Thursday? Seriously confused about what is going on over there.
That is strange.
That is strange. I was looking on there today and didn’t see anything like that. I wonder if depends on where the item is located and if there is a package log jam. Remember, Amazon is dependent on Fedex and UPS to deliver, so it could be an issue on that end. I don’t know, but only speculating.
You know, my last five orders have gone straight through USPS. I think they’re really trying to reduce their shipping costs and perhaps USPS is just less able to do immediate shipping. Not a fan.
I think Amazon get into an agreement with USPS to do Sunday delivery soon, so maybe they’re testing their viability. I don’t like the tracking for USPS and they rarely deliver stuff on time.
No Amazon anything for me, They are putting stores out of business. I rather go out shopping. Good to get out of the house. People complain about Walmart, hurting the little guy, yet Amazon gets a pass. Amazon is really not that much cheaper anyway. Just how I feel.
That’s OK. I can understand your trepidation. I will say that I’m tired of hearing how Amazon is putting stores out of business. This is what competition is all about. If you don’t change with the times, you will lose. Many retailers didn’t start going online until they lost business. Too little, too late. If you don’t go with consumers, you lose. Blaming Amazon won’t bring back customers and won’t change the need to get in front of them.
No offense, as I enjoyed the article. But that math argument only makes sense if you are willing to pay for 2-day shipping. Otherwise, it’s invalid. If you order $35 or more (which I always do), then shipping is free anyway. So we’re talking a cost of $0/year for shipping, vs. $99/year for shipping. Kind of a no brainer from a shipping cost standpoint.
Now the movies and streaming… Yeah, that might be a good sell to me, thinking about it based on that. The 2-day shipping would just be a perk in that case.
No offense taken Clint. I would agree with you, but not everything Amazon sells or ships is under the $35 dollar free shipping umbrella. They have just expanded the number of products, but it’s not just the basket amount, but also which products they allow. The math is only there to show you what you would be paying if you went with 2-day shipping. That’s the only way comparing prices actually works. There have been people noticing that Amazon has been slowing down their free shipping so you don’t get it for 5-8 days. To me, $99 a year is worth getting free and fast shipping, plus the streaming.
There’s a second flaw (after Clint’s) in your case for prime. Most lower cost items are marked up for prime. Often you can find a retailer with free shipping (not prime) with a lower cost. So you are not only paying the $99/year but also the additional markup on small items, which adds up. I would not keep prime if it were not for the fact my wife uses it for business. There are a handful of exclusive video offerings of interest to me, but otherwise, it’s the last place I go for videos. The music service is awful. They typically have limited offerings and multiple albums of the same music so selecting songs from an artist gives you a song-repeating playlist.
If you are going to argue that free shipping and free 2-day shipping aren’t the same, then you have to account for the most frustrating issue with prime; about 50% of the items arrive a week or more later, but are listed under “prime 2-day shipping”. I have complained on multiple occasions, but the simple fact is that Amazon can’t really control the vendors, or when they ship, even if when they finally do ship, they use “2-day”.
You can often find a lower cost with free shipping, but that shipping is often days longer than what you get with Prime. You have to account for what it costs for two-day shipping with prime compared to the same option with someone else.
Sorry to hear you don’t get your items on time. I get them in two-days or less about 98% of the time. I rarely have any issue, so 50% might be your experience, but things that are set to prime shipping aren’t always coming from another vendor. Amazon ships many of those themselves using their FBA model. They have them in their warehouse. Yes, things can sell out, such as when they had huge orders for the Instapot products during the holidays and couldn’t keep up, but I don’t have issues with not getting product to my location.