Searches for ‘Canceling Amazon Prime’ Spike on Prime Day
An order picker collects customer delivery orders at an Inc. fulfilment center during the online retailer’s Prime Day sales promotion day in Koblenz, Germany. (Photographer: Krisztian Bocsi/Bloomberg)

Searches for ‘Canceling Amazon Prime’ Spike on Prime Day

(Bloomberg) -- Internet searches for “Canceling Amazon Prime” were 18 times higher on Monday -- the beginning of Inc.’s two-day sale -- than the previous day, according to search intelligence firm Captify. The data suggest shoppers want to snatch up discounted gadgets and appliances without making a long-term commitment to the world’s biggest online retailer.

“If Amazon is hoping to use Prime Day as a way to sign up and retain new Prime members, they might need to rethink their retention plan,” Captify said in a statement. “According to search, consumers are signing up for Prime, getting their deals and then canceling membership shortly after.”

Shoppers are projected to spend $5.8 billion on Amazon over the two days, according to an estimate from Coresight Research. The e-commerce giant launched Prime Day in 2015 as a way to lure new Prime members, who pay fees in exchange for shipping discounts and other perks like video streaming.

Analysts estimate Amazon’s Prime member retention rate is more than 90%, better than Costco Wholesale Corp. The Seattle-based company has used a variety of tactics to try to find additional subscribers. For example, Amazon offers monthly memberships to attract those who don’t want to join for a year.

The average Prime member spends $1,400 a year on Amazon, more than double the $600 spent by shoppers who aren’t Prime members, according to Consumer Intelligence Research Partners. The firm estimates Amazon has 103 million Prime members in the U.S.

Captify based its estimate on searches by 2.2 billion global consumers using computers, voice-activated devices and smartphone apps. The search metrics include sites like Reddit and deal hunting websites that have discussion forums where shoppers swap knowledge about the best prices, said Rohaan Dullabhai, a senior insight strategist at Captify.

Searches for Best Buy Co. were up 255% from the day before Prime Day, while Walmart Inc. queries climbed 130% and EBay Inc. searches rose 72%. That suggests shoppers are bouncing from one site to another in search of the best deal before subscribing to Amazon Prime, he said.

"Consumers are becoming more and more savvy," Dullabhai said. "They are going to the discussion forums to find the best deals and taking advantage of all of these retailers competing with one another."

©2019 Bloomberg L.P.

BQ Install

Bloomberg Quint

Add BloombergQuint App to Home screen.