Amazon looks to save money – and the environment – with new Prime strategy
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Amazon looks to save money – and the environment – with new Prime strategy

Ecommerce giant Amazon has announced a new program for Prime members that could help it achieve two of its long-term goals: saving money, and saving the environment. How will it do that? By letting Prime members group orders together into a single box. Like most great ideas, it’s simple – but has the power to be incredibly effective. And, if the company is to be believed, its trial run has already eliminated a huge amount of packaging material from Amazon’s operation.

Amazon’s share price has appreciated by 12% so far this year

graph amazon

Source: Yahoo Finance

Amazon’s incredible success story is well-known, and the company now services millions of people around the world. And a growing number of these people are signed up to the company’s wildly popular Prime scheme, which lets them access discounts, free services, and – crucially – free 2-day shipping. As you can imagine, paying for all that shipping out of its own pocket represents one of Amazon’s major costs.

Add to that the huge amount of packaging the company has to produce in order to send its billions of packages out… and you have a significant outlay. Letting customers combine orders into a single box cuts down on both shipping and packaging costs – a win-win for the company, and for the customer, who probably doesn’t want a house overflowing with multiple Amazon boxes.

Another reason Amazon wants to reduce the number of boxes it posts is environmental. Amazon has committed to making 50% of its shipments zero carbon by 2030 – given the incredible number of packaged Amazon sends out every year (608 million) that could represent a real difference for the planet.

Maria Renz, the overseer of Amazon’s delivery experience, didn’t mince words when it came to the effectiveness of the program’s pilot. She told reporters: “We’ve been testing this program with a group of Prime members and Amazon Day has already reduced packaging by tens of thousands of boxes.”

Disclosure

Dominion holds Amazon in its Global Trends Ecommerce Fund.


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