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Now Amazon wants to clean your home
In his annual letter to shareholders, Amazon.com founder and CEO Jeff Bezos wrote, “We want Prime to be such a good value, you’d be irresponsible not to be a member.”
To make good on that proposition, Amazon currently offers free two-day deliveries on over 30 million items, free same-day deliveries on hundreds of thousands of products, Sunday deliveries along with free video streaming of original series and other programming, free storage on the Amazon Cloud, the Kindle Lending Library, discounted rates on its new streaming music subscription services, etc. Now, according to reports, it appears as though Amazon plans to add housekeeping services as a perk for its Prime members.
The Seattle Times appears to have been the first to spot two job postings on Amazon’s site seeking “Amazon Assistants” who will work as two-person teams “tidying up around the home, laundry, and helping put groceries and essentials like toilet paper and paper towels away.” The goal is to create “errand-free” homes for Prime members.
This new service appears different than Amazon Home Services, launched last year, that helps shoppers find and hire local professionals a la Angie’s List and HomeAdvisor.
The latest Amazon news follows reports in September that the company is working on a new delivery option for Prime members that would allow designated couriers to enter residences to deliver items when customers are not home.
Amazon charges an annual fee of $99 for its Prime service. Members who also use Amazon Fresh pay an additional monthly fee of $14.99 to have groceries delivered to their homes.
The annual fee provides cash flow while tethering customers to Amazon’s service. Prime members spend twice what non-members spend, according to Consumer Intelligence Research Partners (CIRP).
Seventy-three percent who sign up for Amazon’s free 30-day Prime trial membership make it permanent, according to CIRP. Ninety-one percent of first year subscribers renew their memberships for a second year, while 96 percent who have been members for two years re-up for a third time.
- Amazon looks to clean house — literally – The Seattle Times
- Amazon hints at housecleaning service in Prime – USA Today
- Annual Letter to Shareholders – Amazon.com
- Amazon’s Prime retention rates are just sick – RetailWire
- Will customers give Amazon the keys to their smart homes? – RetailWire
- Amazon’s Prime Now is going mobile and beyond – RetailWire
- Amazon guarantees service for household projects – RetailWire
Discussion Questions
DISCUSSION QUESTIONS: Do you think significant numbers of Prime members will pay extra for Amazon home assistants? What other types of perks do you think fit with Amazon’s goal of expanding the ranks of Prime members?
Poll
BrainTrust
Tom Dougherty
President and CEO, Stealing Share
Lee Kent
Principal, Your Retail Authority, LLC
The number of customers that sign up for the Amazon home assistants is not the issue. What we need to focus on is Amazon’s relentless quest to become indispensable and dyed in the wool of the consumer’s worldview.
Few brands have this deep an understanding of brand extension. Amazon is the new Apple.
It could not be said better!
What exactly will people pay to have someone put their paper towels away? Hard to say, but Amazon has cleverly convinced people that its fee-based services are actually free. I wouldn’t underestimate their ability to expand.
Good catch on this news item RetailWire. The service economy surpassed the product economy a long time ago, and beyond extended warranty registration, retailers too often overlook that service buyers are the same people as product customers. If commerce really is about customer experience, and share of wallet is the retailer’s goal, then retailers should take this page from the Amazon playbook.
While I love to see what Amazon comes up with next, I question the potential success of this idea. Certainly it will not be part of the Prime fee so I am not thinking a lot of folks will want to pay strangers to come into their homes to put things away. Also, many of us who order our staples through Amazon do not store them in the same places that we use them simply because we don’t have room. How do you explain to a stranger where you want it stored?
Ding me if you must but our practical Millennials, who are huge Prime users, and us Boomers are not very likely to want this service. I would suggest Amazon put their thinking caps back on.
But that’s just my 2 cents.
Yes, Amazon is working to be the one we turn to for all our needs. But tell me, what stranger are we going to entrust with the keys to our homes? That is something I choose to do for myself. I am not going to give this to someone else to choose for me.
Whether it works, makes money, and or makes prime stickier remains to be seen. The amazing and notable thing though is the pace of experimentation and PR that Amazon generates. Nothing ventured, nothing gained. How many other retailers do you know that have this culture of trying customer focused activity out in a non traditional manner.
This seems like a stretch for Amazon, but it seems like everything Amazon touches turns to gold. Amazon recognizes consumers’ desire to simplify their lives and the value they place on convenience. The new Amazon Assistants definitely aligns with consumer needs, so maybe it will work. Amazon has a cult like following and maybe some of the brand affinity and loyalty they have built with their customers will extend to this and other adjacent products and services. They have a vision that far exceeds the box people have placed them in and they appear to be succeeding each time the extend outside that box.
It will be interesting to see how this plays out.
For total integration, Amazon should provide nanny services, to get the kids off to school, and bring in a chef to prepare dinner. On the weekends, they can provide a babysitting service, so the parents can go on an Amazon Prime Cruise, which will have an Amazon echo in every room, that can replace the Butler, and the Amazon Drones can deliver your beer to the pool deck, for an extra fee. I could go on, but hey, I’ve been up all night enjoying the election, so excuse me for being silly. Amazon gets more press than the Kardashians, and nobody does it better. Have a nice day, I’m going home to take a nap.
Services require people, labor, with a smaller margin to Amazon. Better for the company to find the next AWS to support its retail habit. Prime and Alexa are great ways for Amazon to ingratiate itself into the fabric of customer lives with big margin. A turn to services offerings is not something that will increase the profit margin for Amazon, so I’m surprised to see it as an offering.
Existing members will pay more. The science of incremental value plays a role here. Human learning suggests that one would be more than happy to top-up the payment if there is value that ties to basic human nature — laziness. Human beings are lazy and anything that can offer or even give hope to assist them will be a hit. It is completely different discussion on whether they will use this feature. However, attracting new members requires a different strategy.