.svg)
Latest Business News
How Much Money Do Americans Spend on Amazon Each Month?
The Impact of Amazon Prime
According to a survey conducted by Upgraded Points, the average American spends $91.75 on Amazon each month. However, this number varies based on whether or not individuals are Amazon Prime members. Non-Prime members spend an average of $38 per month, while Prime members spend an average of $110 per month, or $1,320 per year. The survey also revealed that during Amazon's Prime Day shopping holiday, customers reported spending an average of $117 on discounted products.
The Benefits of Amazon Prime
With a subscription fee of $139 per year, Amazon Prime offers various benefits to its members, including free two-day shipping, access to Prime Video streaming service, and discounts at Amazon-owned Whole Foods. These perks entice customers and contribute to the platform's success. In fact, Amazon Prime boasts over 200 million members, making it a popular choice for online shopping.
The Convenience of Amazon
One of the main reasons for Amazon's ability to generate high customer spending is convenience. With just a few clicks, customers can easily purchase items through the app or website. This ease of use has led to 25% of Americans buying from Amazon one or more times per week. Additionally, 33% of Americans believe they've spent more money on Amazon this year than they have in their savings accounts.
The Regional Spending Habits
The survey also revealed variations in spending habits among different states. The top ten states with the highest monthly spending on Amazon include Tennessee ($124.22), Delaware ($114), Wisconsin ($113.66), Iowa ($113.46), Washington ($112.06), New Mexico ($110.56), Kentucky ($108.63), Utah ($107.69), Massachusetts ($105.52), and Arkansas ($105.20).
On the other hand, the states with the lowest monthly spending on Amazon are West Virginia ($56.10), Minnesota ($68.86), Indiana ($72.87), Missouri ($74.78), Maine ($75), Pennsylvania ($75.79), Nevada ($75.93), Kansas ($76.29), Idaho ($77.07), and Oregon ($77.55).
Amazon's ability to generate substantial customer spending is evident. With the convenience of Amazon Prime and the wide range of products available, customers are more likely to spend money on the platform. As the popularity of online shopping continues to grow, it's important for individuals to be mindful of their spending habits and budget accordingly.
Hot Take: The Impact of Amazon on New Businesses
The significant amount of money Americans spend on Amazon each month has both favorable and challenging implications for new businesses. On one hand, it showcases the immense potential and profitability of e-commerce platforms. The convenience offered by Amazon, especially through Amazon Prime, has cultivated a culture of online shopping where consumers are willing to spend substantial amounts. This trend opens up opportunities for entrepreneurs looking to launch their products on Amazon or other online marketplaces. By tapping into this existing customer base, new businesses can gain visibility and reach customers who are already inclined to make purchases online.
However, the dominance of Amazon also poses challenges for new businesses. With such a large portion of consumer spending concentrated on the platform, it becomes increasingly competitive to stand out amidst the vast array of products available. Building brand recognition, establishing a loyal customer base, and driving traffic to independent websites or online stores can be a daunting task. Additionally, the premium placed on offering fast shipping and competitive prices may strain the resources of smaller businesses with limited capacity.
Nevertheless, innovation and differentiation remain key factors in succeeding as a new business in the face of Amazon's influence. Providing unique products, exceptional customer service, and personalized experiences can help businesses carve out their own niche and attract customers who value quality over convenience alone. Targeting specific demographics or verticals that may not find everything they need on Amazon can also be a successful strategy.
In conclusion, new businesses must carefully evaluate the opportunities and challenges presented by the dominance of Amazon in order to navigate the evolving e-commerce landscape effectively. While it may seem intimidating to compete against such a retail giant, there are still plenty of avenues for innovation and success for those willing to adapt, differentiate, and connect with customers on a deeper level.
Article First Published at: https://www.cnbc.com/2023/07/10/americans-spend-91-on-amazon-monthly-these-10-states-spend-the-most.html
