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Forbes has an online piece suggesting that of current Amazon Prime members paying $79 a year for two-day guaranteed delivery on products, as well as complimentary access to a selection of videos and e-books, "three in ten (29%) … would be willing to pay an additional $10 to $20, while a very limited percentage (8%) would accept a rate hike of $30 or more."

The good news is that the customers who would spend the most on prime memberships are the cream of the crop - male, young, with a high level of disposable income and a willingness to spend it on Amazon for things like major electronics. The bad news is that "these Prime members represent the extreme minority" of its customer base.

The solution? "Maybe it’s time for Amazon to introduce Prime membership levels: a base level for free shipping alone and an upgrade for access to Amazon’s digital media content," Forbes suggests. "Or perhaps they should incentivize a higher Prime rate with a rewards system, such as a percentage earned back on purchases à la Costco’s Executive Membership. Ramped up Prime benefits may take the sting out of a higher fee for some as well, because, let’s face it, while Amazon Instant Video is nice, it’s no Netflix – yet."

Meanwhile … the Seattle Times has a story suggesting that Amazon doesn't have much to worry about if it raises Prime memberships, in the same way that Costco has not experienced a loss of members when it has raised fees.

Indeed, the Amazon-Costco comparison may be valid … especially because Costco probably has maintained membership levels by offering improved benefits, such as two percent cash back on purchases made by those with executive memberships. And Costco apparently actually has found that such members spend more when when rates have gone up, because they want to justify the cost.
KC's View:
This will be an interesting process for Amazon, but if I had to guess, it'd be my feeling that an increase in Prime rates probably won't membership levels too much, and will even increase spending by Prime members, at least in the short term. Because I'd also guess that if they can engineer it, Amazon will offer improved benefits at the same time as they raise prices, which will take some of the sting out of it.

Here's my suggestion for an improved benefit, by the way. How about cutting Kindle e-book prices by 10 percent - or one dollar - across the board for anyone who is a Prime member? That would certainly have a positive impact on my book purchasing behavior…