By Natalie Mojica 

Amazon announced on Feb. 3 that it will increase the price of Prime subscriptions from $119 to $139 per year. The price of a monthly subscription will go from $12.99 to $14.99. The increase will go into effect on Feb. 18 for new Prime members and after March 25 for existing members.  

The last time Amazon raised prices for Prime was in 2018 when the company raised membership fees from $99 to $119. 

Amazon Prime offers customers perks like free two-day shipping, a 10% discount at Whole Foods, access to the thousands of TV shows and movies on Prime Video, and unlimited reading from over a thousand books and magazines with the Kindle app. Amazon said it is deciding to increase the cost of Prime because of “expanded Prime membership benefits,” like new Prime Video content and more items available for free same-day shipping, as well as to aid in Amazon’s operational costs. 

From food to energy, the cost of everything is rising, and Amazon’s workforce has doubled over the past two years to include approximately 1.6 million employees (about the population of West Virginia), meaning the company must account for increased wages for thousands of workers. 

Despite the company citing rising operational costs, Amazon’s announcement accompanied its earnings report. Amazon’s profits more than doubled during December to $14.3 billion, causing its shares to increase up to 17% in after-hours trading.  

Even with the increase in membership fees, it is unlikely that members will leave. In the past, most Prime users chose to stay despite the company’s changes in price since Amazon Prime was first launched in 2005 with a $79 annual membership plan. With 200 million loyal subscribers, it is doubtful Amazon will lose many valuable members. In a recent Morgan Stanley analysis, it was reported that households with Prime memberships spent more than $3,000 annually on Amazon, roughly twice as much as non-Prime customers.  

As Amazon Prime becomes ingrained in e-commerce culture during the pandemic, it is not surprising that Prime’s subscription costs are rising. However, competitors are starting to develop their membership programs to catch up. For example, the new Walmart+ membership offers free two-day shipping, grocery delivery, discounts on gas at Walmart’s stations, and more for $98 a year or $12.95 a month. Soon enough, consumers will have more than just Amazon Prime for their fast-shipping, everyday needs.