Amazon.com raises threshold for free shipping to $35 an order
Online behemoth Amazon.com raised the minimum order price to get free shipping to $35, a decision that could give the retailer a big boost during the crucial holiday season.
The $10 bump affects the company’s Super Saver Shipping, which for years offered free shipping on any orders that cost $25 or more. The move comes just days before the Seattle company releases its third-quarter earnings results.
“This is the first time in more than a decade that Amazon has altered the minimum order for free shipping in the U.S.” the company noted in a Tuesday blog post. “During that time, we have expanded free shipping selection by millions of items.”
With the move, more customers may opt to spend $79 a year on Amazon’s Prime shipping service, with perks such as free two-day shipping and access to instant video streaming, analysts said.
Some analysts say the change could be a boon to Amazon.com, which is investing heavily in distribution centers and also in digital products. In the second quarter, Amazon reported a net loss of $7 million, or 2 cents a share. In its 2012 fiscal year, the company suffered a $39 million loss.
Other industry watchers speculated that the change may be prompted by a lackluster earnings report due Thursday.
Paulo Santos, a trader and analyst at financial site Seeking Alpha, said free shipping “has long been a cornerstone” of the company’s strategy.
“Moving this threshold is a borderline desperate measure,” Santos wrote in a Tuesday blog post. “A measure which would only be taken if Amazon.com internally was looking at some seriously ugly numbers.”
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