Amazon launches Prime service in India to woo customers

In an attempt to increase customer loyalty in its fastest-growing market, Amazon has launched its Amazon Prime membership programme in the country.

Amazon Prime members will get unlimited free one-day and two-day delivery in over 100 cities and early access to lightning deals and exclusive offers. Amazon Prime is available for a free 60-day trial period, and thereafter, at an introductory annual subscription of Rs 499 ($7.4), a discount of Rs 500 from the list price of Rs 999 ($14.8). This is considerably lower than its price in the US ($99) and UK (£79), but subscribers in the US can also get unlimited photo storage, access to free e-books on Kindle First and Kindle Owners' Lending Library, and Prime Video and Music.

Amazon India has said that it will launch Prime Video, which includes Amazon's original TV series and movies, soon. Indian customers in 20 cities can also opt for same-day morning or scheduled delivery at a discounted fee of Rs 50 per order on 10,000 products.

"With Prime, guaranteed one-day delivery becomes an everyday experience instead of an occasional indulgence, and with no minimum purchases, it provides unlimited convenience all year long," Amazon India country head Amit Agarwal said. "For sellers, Fulfillment by Amazon is now an even more powerful opportunity to rapidly grow their business and at the same time, provide customers across India with vast selection and unlimited fast free Prime delivery."

Amazon Prime has been successful in the US, where it has 63 million members. More than half of all Amazon customers in the US are Amazon Prime subscribers. Amazon Prime shoppers also spend an average of $1,200 annually, as compared to $500 for non-members.

It remains to be seen whether Amazon can repeat this success in India. Amazon's main rival in India, Flipkart already has a similar service called Flipkart First. Priced at Rs 500 ($7.4), it offers free fast deliveries and discounted one-day deliveries.

In the last few years, Amazon has been pumping considerable money into the Indian market. In June, CEO Jeff Bezos had announced that he would increase investments in India by an additional $3 billion. This placed Amazon's total investments in the country ($5 billion), above that of its homegrown competitors, Flipkart and Snapdeal. This month, it opened six new fulfillment centres near major cities to meet growing demand.

Amazon also recently overtook Flipkart in several parameters, including the number of app downloads and website traffic, as well the sellers and the products listed on its platform.