Why Prime is a big win for Amazon

03/19/2013 | Time.com

Amazon's Prime service, in which customers pay $79 a year for free two-day shipping and digital content, has proven a big win for the online retail giant. The cost to Amazon of Prime perks only marginally exceeds the fees it charges, and members increase spending by as much as 150%. The key, Brad Tuttle writes, is a price point that's not too expensive but is enough to spur increased spending to justify being a member.

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