Amazon has long been the "Everything Store." Now, thanks in part to its Prime membership program, it has become the everyone store.
For the first time ever, Americans are shopping at Amazon at nearly the same frequency as the country's largest retailer, Walmart: Sixty percent of primary household shoppers bought something at Amazon in the four weeks ending June 16, roughly the share of Walmart shoppers during the same period, according to consultancy Kantar Retail.
Amazon's share is up from 31 percent of consumers in 2009, back when 68 percent of people said they had shopped at Walmart, according to Kantar. Amazon hasn't surpassed Walmart yet, but the retailers have been close for six months.
The chief driver? The Amazon Prime membership program, which gives customers free, two-day shipping, as well as streaming videos and music, for $99 a year. It's the secret sauce in Amazon's quest for retail dominance.
On Tuesday, Amazon will celebrate its Prime members -- and try to convince more people to join the loyalty club -- with its second annual Prime Day, a made-up shopping holiday with Black Friday-like deals for Prime members. Critics gleefully panned last year's Prime Day as being loaded with dud offers, inspiring the Twitter hashtag #PrimeDayFail.
But blockbuster sales are beside the point. Prime Day helped Amazon sign up 19 million new Prime members in the past year, according to Consumer Intelligence Research Partners, or CIRP. As Prime membership shot to 63 million this year, members became the majority of Amazon shoppers for the first time. Prime members made up 52 percent of Amazon shoppers as of June, up from 44 percent in June of 2014, according to CIRP. Amazon's moves to offer more perks, such as streaming web video and music, show it's willing to keep piling on incentives for Prime members.
A broad trend toward online shopping certainly helped Amazon grab a bigger share of consumers. But the surge in regular Amazon visitors also points to how Prime has helped usher in a profound shift in consumer behavior: The promise of fast, free shipping has made it just as routine for most shoppers to pop over to Amazon.com when they run out of toilet paper or toothpaste as they once found their weekly stock-up trip to Walmart. It's now commonplace to open the Amazon app within seconds of a need, instead of waiting until a big shopping excursion is necessary.
The shift has meant big business for Amazon -- and a steady loss of market share for competitors such as Walmart.
Research shows Prime members spend more than twice as much as non-members -- an average of $1,200 a year, compared to $500 for non-members, according to CIRP. They also tend to be more profitable, and shop more often.
In response, Walmart is trying to mimic its e-commerce rival with its own version of Amazon Prime, called ShippingPass. Walmart's half a trillion dollars in annual sales still dwarf Amazon's roughly $110 billion -- not to mention Amazon's still-paltry profits.
But the rising frequency of Amazon shopping should worry Walmart and other retailers more than the financial metrics, because once Amazon gets shoppers hooked, they tend to stick around: Bernstein analysts estimate the average Prime membership lasts nearly seven years.
For Amazon, every day is Prime Day.
This column does not necessarily reflect the opinion of Bloomberg LP and its owners.
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