OPERATIONS

Report: Amazon Prime price may rise

BY Dan Berthiaume

Seattle – The price of subscribing the Amazon Prime preferred shipping program will reportedly increase. According to the Huffington Post, Tom Szkutak, CFO of Amazon, said on a Jan. 30 investors call that the company is considering raising the current $79 yearly fee for Amazon Prime, which includes free two-day shipping, by $20 to $40 in the U.S.

The main rationale for potentially raising the cost of Amazon Prime is reportedly that it has not changed since the program launched in 2005 and fuel and shipping costs have gone up significantly. Szkutak did not give a timetable for when the price change may occur or if existing customers would also have their annual fee raised.

In addition to free two-day shipping on 19 million items, Amazon Prime offers features such as access to Amazon Prime Instant Video and a digital library for Kindle owners. Amazon has previously said that Amazon Prime has tens of millions of members.

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MARKETING/SOCIAL MEDIA

Study: Facebook influences holiday shoppers

BY Dan Berthiaume

New York – Facebook had a notable influence on holiday shoppers, especially those using mobile devices. According to a new study from Millward Brown Digital, 83% of 500 consumers surveyed who follow a retailer or consumer product on Facebook found their posts to be somewhat to very valuable when preparing for holiday shopping.

And when the holiday shopping was complete, 89% of shoppers shared their experience on Facebook. At the store, 65% of shoppers accessed their phones for a shopping-related activity; and, while shopping in-store, those people used Facebook at four times the rate of any other app or search. Nearly 60% of shoppers who used Facebook for information and ideas found it to be influential to their shopping experience.

Other notable findings include:

• Nearly two-thirds of shoppers spent less than an hour researching their trip; they typically made a purchase within three days from the start of their research.

• News Feed played a key role in consumer discovery — 46% of people who used Facebook before shopping used it to look for deals, promotions and holiday gift ideas.

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REAL ESTATE

Report: Saks to add luxury items, outlet stores

BY Dan Berthiaume

New York – Saks Fifth Avenue is reportedly planning to both increase the amount of high-end luxury goods it sells and also increase the number of Saks Off 5th outlet stores it operates. According to the Wall Street Journal, Richard Baker, CEO of Canadian department store chain (and new Saks owner) Hudson’s Bay Company wants to overhaul Saks stores by selling more items such as $48,000 Louis Vuitton crocodile handbags.

In addition, Baker plans to spend as much as $1 billion in upgrading Saks stores, with $250 million earmarked for the company’s flagship Fifth Avenue store in New York. Changes to the flagship will include redeveloping the 30,000-sq.-ft. lower level that currently houses a hair salon and storage into retail space, which will double the space dedicated to handbags and also include new duplex displays that cover both the first and second floors.

Baker also plans to more than double the store count of Saks Off 5th outlet stores from the current 71, including 20 stores in Canada. He also wants to increase outlet profitability by placing more lower-priced merchandise, including Lord & Taylor overstock, and increase customer appeal by making the stores less like traditional department stores and more cluttered full of item like competing Nordstrom Rack outlets. Other new plans for Saks include using its e-commerce platform as infrastructure for all Hudson’s Bay, Lord & Taylor and Saks online activities, which would save the company a reported $50 million per year.

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