Amazon share: Amazon has probably found a way to make Prime terminations significantly more difficult

Codename Iliad

With the project, codenamed Iliad, Amazon aims to make it significantly more difficult for its customers to cancel Prime. This emerges from internal documents leaked to Business Insider. The project reportedly added questions and new offers to the cancellation process at multiple levels in hopes of reducing cancellations. In fact, after the project started in 2017, Amazon saw a whopping 14 percent drop in cancellations as fewer members navigated to the final cancellation page. This multi-step cancellation process (a version of which is said to be still active), as Business Insider explains, “is just one example of subtle design choices that Amazon has used to complicate or confuse the Prime subscription and cancellation processes.”

Complaints to the Federal Trade Commission

The complexity of the termination process has led to multiple complaints about Amazon being filed with the Federal Trade Commission in recent years. This called for an investigation into the Amazon Prime cancellation process and the use of so-called “dark patterns”. “Companies like Amazon are obviously speculating that customers would give up on cancellation, either by repeatedly warning about the benefits that are disappearing, or by making the process so difficult that users eventually give up,” explains the Norwegian Consumer Council in the description of its results in January 2021. In an email to Business Insider, an Amazon spokesperson explained that the Prime enrollment and cancellation processes are “simple and transparent, clearly presenting customers with choices and the implications of those choices.” Amazon’s Vice President also explains that transparency and customer trust are top priorities for the company.

Prime cost increase

In addition, the US company only announced in February 2022 that Prime fees in the US would become more expensive. And that despite the fact that the company almost doubled its profit in the fourth quarter of 2021 compared to the same period last year, according to a press release. While the company’s earnings for the fourth quarter of 2020 were $7.2 billion, it was $14.3 billion for the same period in 2021. On an annual basis, net income increased 22 percent to $469.8 billion in 2021. In the meantime, the Prime fees in the USA no longer cost 12.99 US dollars as before the price increase, but 14.99 US dollars. With the annual payment method, the price went from $99 to $119.

E. Schmal / Editor finanzen.net

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