Data Dive

The Try New Things Edition: Amazon, Bitcoin And Airbnb

Data Dive: Intuit, Zillow And Amazon

It’s never a bad idea to try a new thing — and this week was full of a lot of players in payments trying new things.

Amazon is trying out some new pricing as it works to expand and better monetize its Amazon Prime Customer base. Bitcoin is getting used to a new, and reset, pricing order as investors worldwide say they aren’t concerned about the coming regulatory wave (or the army of hackers stealing cryptocurrency), but the sluggish pricing tells a different story.  And Airbnb is trying to get more competitive by making bookings cheaper up front.

It was a lot to keep up with — but luckily, we did it for you.

 

Amazon’s Prices Are Up — And Down

It just got more expensive to be a Prime Member for those on the monthly plan.

It will now cost $2 extra a month to have access to free two-day shipping, media streaming and other Prime benefits, raising the annual cost of membership 18 percent to $156. Annual membership will remain at $99 a year for those who pay it in one lump sum and Prime Video membership will remain at $8.99 per month.

The price increase comes as some analysts — namely Morgan Stanley — report that Prime membership has slowed and might have hit a plateau at around 40 percent of American consumers.

According to the Consumer Intelligence Research Partners (CIRP), Amazon currently has 90 million U.S.-based Amazon Prime subscribers. The study also estimates Amazon Prime subscribers spend almost double the $700 per year the average non-Prime Members spend on the site.

But as prices go up on Amazon — particularly for lower income customers more likely to opt for the monthly, as opposed to yearly, plan — prices are also going down as Amazon is rolling out an under $10 section.

The items in the new section are notable for their price — namely, cheap — and also for the fact that they ship without a fee (all shipping is free with Amazon Prime, but $10 and under items’ free shipping is not limited to Prime customers.)

Amazon, thus far, has rolled the program out quietly — sans an announcement — but does display it in the What’s New section of Apple’s App Store.

The section is called $10 & Under and is found in the app’s main navigation. The new section organizes the cheap products via category.

 

Following The Bouncing (And Stolen) Bitcoin

While an ever-growing number of fans is usually a good thing, developing a rapid following among cybercriminals is almost never a good thing.

But bitcoin has lots of hackers for fans, according to Lex Sokolin, global director of FinTech strategy at Autonomous Research — and those fans have managed to run off with over $1.2 billion worth of bitcoin and Ether in the last decade.

“It looks like crypto hacking is a $200 million annual revenue industry,” Sokolin said, noting that more than 14 percent of bitcoin and Ether supplies have been compromised by hackers in that timeframe.

Worldwide, those hacks come at a cost to governments and companies of $11.3 billion in tax revenue from coin sales, according to Susan Eustis, CEO of WinterGreen Research.

And the experts agree — as interest in cryptocurrency continues to flourish, the attraction is likely to only grow stronger, and the attempts will likely be more frequent.

And while $1.2 billion is a lot of money to have lost — notably, it is literally 1 percent of the $100 billion in value bitcoin and other associated crypto currencies managed to lose on what one PYMNTS writer described as “as a not so good Tuesday” when fears of coming regulatory structure to the emerging markets kept prices depressed for most of the week.

As of the writing of this story, bitcoin was trading off its high of $20,000 at roughly $11,201.

 

Airbnb Lowers The Bar  

Good news for Airbnb fans who can now pay for a portion of a trip — instead of the entire thing up front — when they book through the app.

Previously, Airbnb guests had to pay 100 percent of the trip at the time of booking. With the introduction of Pay Less Up Front, guests can now pay for just a portion of the trip at the time of booking, usually a 50 percent deposit.

The remainder is paid closer to check-in.

“The new feature extends our commitment to providing flexible payment options to more guests, and greater opportunities for hosts,” said a company statement.

During testing of Pay Less Up Front, the company found that given the choice of paying less up front, 40 percent of guests chose to take advantage of the opportunity. Even better: They then opted for higher-value bookings on the whole.

Moreover, Airbnb noted, the new option gives hosts a better chance of capturing more bookings as they now can access cash-flow sensitive guests who now have a better incentive to book earlier.

Compared with ordinary bookings, the Pay Less Up Front option led to reservations with nearly double the lead time, helping hosts to secure and manage bookings more easily.

Bookings must be a certain value to qualify for Pay Less Up Front — $250 or more — and must be booked at least 14 days from the check-in date.

 

So what did we learn this week?

Some resets are more fun than others.  Airbnb guests booking earlier, more often and more expensively sounds like a win for everyone — whereas the various mysteries surrounding bitcoin are probably good for no one, except maybe hackers.

As for Amazon?  A $10 section is nice — but $156 a year for Prime is high enough that they might have pushback.  Or, more customers opting for Walmart’s free shipping over $35.

 

‘Till next week.

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