As PM for Amazon Prime, would you add more Amazon Prime benefits that increase membership cost, or maintain current Amazon Prime benefits at existing price?

Introduction

The trade-off we're examining today is whether to add more Amazon Prime benefits that increase membership cost or maintain current Amazon Prime benefits at the existing price. This scenario touches on the core value proposition of Amazon Prime and its impact on customer retention, acquisition, and overall business growth. I'll approach this analysis by examining the current product landscape, potential impacts, key metrics, and experimental design to inform our decision-making process.

Step 1

Clarifying Questions (3 minutes)

• Based on recent market trends, I'm thinking customer price sensitivity might be a key factor here. Could you share any insights on how our Prime membership growth rate has changed in the last 6-12 months?

Why it matters: Helps gauge current market appetite for Prime and potential resistance to price increases. Expected answer: Slowing growth rate due to market saturation and economic pressures. Impact on approach: If growth is slowing, we might lean towards maintaining current benefits and price to protect market share.

• Considering our ecosystem strategy, I'm curious about the types of new benefits we're considering. Are these primarily Amazon-owned services or third-party partnerships?

Why it matters: Influences the cost structure and scalability of new benefits. Expected answer: Mix of both, with a focus on expanding our own service offerings. Impact on approach: In-house benefits might justify a price increase more easily due to better margins and ecosystem control.

• Looking at user behavior, I'm wondering about the utilization rates of current Prime benefits. Do we have data on which benefits are most valued by our members?

Why it matters: Helps identify core value drivers and potential areas for expansion or optimization. Expected answer: Shipping, Prime Video, and Prime Day are top utilized benefits. Impact on approach: Would focus on enhancing high-value benefits rather than adding new, potentially underutilized ones.

• From a technical perspective, I'm thinking about our platform's capacity to support new benefits. Are there any significant infrastructure upgrades required to implement potential new offerings?

Why it matters: Affects feasibility and timeline of implementing new benefits. Expected answer: Some upgrades needed, but within current technical roadmap. Impact on approach: Might influence the timing and rollout strategy of new benefits.

• Considering our current resource allocation, I'm curious about our capacity to support new benefits. Do we have the necessary teams in place to develop and maintain additional services?

Why it matters: Impacts the feasibility and quality of new benefit offerings. Expected answer: Some resource constraints, but potential for reallocation. Impact on approach: Might lean towards optimizing existing benefits if resources are limited.