Yesterday, I linked to Eric Hellman’s post about “Publishing’s Amazon-powered future“. In it, Hellman outlined how publishers are fundamentally misunderstanding the retailer’s long-term competitive strategy.
In his post, Hellman makes the point that “Amazon has alway been willing to lose money to achieve that scale.” It’s a point that came to mind when I read an Internet Retailer report about a new offer Amazon introduced this past week in Germany:
“The Amazon Student Membership program gives students a free one-year membership to Amazon Prime, Amazon’s loyalty program that offers unlimited free next-day delivery and other perks. After a year, students can sign up for Amazon Prime for 15 euros (US $19.64) a year—about half the regular price— and keep that discounted price for the next four years.”
“Through the program, German students can also get 20% higher value for products they turn in to Amazon via Amazon Trade-In and use the credit they receive to purchase products from 25 categories on Amazon.de.”
The IR post points out that this offer parallels one made two years ago to students in the U.S. An offer doesn’t have to be new to underscore the point, though. If Amazon is all about scale, what are we about?