Cost of Amazon Prime going up?

[ISiddiqui]

Btw, in case you are wondering (this is last year when it was just in NYC):

http://www.wsj.com/articles/amazon-t...ity-1418071863

At the base, Amazon has built a lounge replete with foosball, pool and air hockey tables; an arcade; and other amenities for messengers hanging out between deliveries, the person said. Messengers are paid around $15 an hour and work eight-hour shifts.

Now, granted $15 an hour may just be for NYC, but that's quite a decent salary for a courier.

[ISiddiqui]

Originally Posted by Logan

But isn't the "courier" inevitably the same guy in both examples? Someone is getting me my item today in example #1.

I'm pretty sure they are different. One using a delivery service, other using a courier service - through from WSJ it seems it may be an in-house thing... at least in NYC. Not sure about the other cities they are in.

[Logan]

Originally Posted by ISiddiqui

The UPS and FedEx folks get a list of their deliveries for the day. Therefore they can plan their route. Couriers get it and have to make a bee line for the one location and come back for the next one. I see courier work as far, far more stressful. Having lead time matters.

I won't speak for other locations but there is zero chance it works this way in NYC. Amazon's warehousing/inventory system is based upon efficiency and there is no way some guy is delivering one box to the Upper West Side while passing others that are also getting deliveries, only to return to some central location, to go back to pick up their boxes and make those deliveries.

[ISiddiqui]

Originally Posted by molson

What would be so terrible about Amazon paying the employees more, and charging a little extra for 2-hour delivery?

What's the difference in the end? This way the courier actually gets the entire of your extra cost, rather than splitting it.

[ISiddiqui]

Originally Posted by Logan

I won't speak for other locations but there is zero chance it works this way in NYC. Amazon's warehousing/inventory system is based upon efficiency and there is no way some guy is delivering one box to the Upper West Side while passing others that are also getting deliveries, only to return to some central location, to go back to pick up their boxes and make those deliveries.

In Prime Now, I think they probably try to group as many as possible, but if they can't, I'd imagine they'd have to go themselves. Especially since after your order, the app becomes basically a tracking app:

What it's like to use Amazon Prime Now | Android Central

At this point in the purchase, the Prime Now app becomes a tracking app. You get a map showing you where the package is coming from, who the name of your courier is, and a small purple dot to track that driver along his or her route. When you package is ten minutes from its destination, you'll get a text message warning you the package is nearby.

[molson]

Originally Posted by ISiddiqui

What's the difference in the end? This way the courier actually gets the entire of your extra cost, rather than splitting it.

See my edit above about the tipping system basically just being a "dick discount". By tipping, you're just subsidizing the service or product cost of people who don't tip. If there's 10 orders, and 7 people tip $5, that's $35. I'd rather Amazon just pay the employees and spread that $35 cost among all 10 customers, rather then penalize the tippers. Of course in reality, Amazon wouldn't pay a whole $35, they'd pay much less, which is the whole reason corporations love the tipping culture, it saves them money.

[molson]

Dola, just tell me how much something costs and I'll decide to pay or not. It's insulting when a global corporation, motivated solely by a desire to reduce what they pay employees, utilizes social pressure to guilt me into subsidizing their worker's salaries. Somehow the rest of the world manages without this setup, for the most part.

[Logan]

There are dozens of courier and messenger services in NYC already. I don't know of a single one that is "free" with a suggested tip involved. If my lawyer is sending me a contract by courier, he's paying the service and I'm sure passing the fee along to me in his billable rate.

Even Uber offers it as a service (Uber Rush)...which they charge for.

[Arles]

Tipping to me is associated with a service provided that goes above and beyond the "normal expected". I don't see how people can be OK tipping a pizza guy a few bucks for bringing a pizza 45 minutes after ordering, but not feel a courier deserves a similar tip for bringing a package 2 hours after ordering. Heck, I tipped a bellhop $5 for pushing a cart with a few suitcases 30 feet (no stairs or elevators) at the last hotel I stayed at. Given the low threshold for "tips" in today's society, I think this level of courier service more than qualifies.

[ISiddiqui]

Originally Posted by molson

See my edit above about the tipping system basically just being a "dick discount". By tipping, you're just subsidizing the service or product cost of people who don't tip. If there's 10 orders, and 7 people tip $5, that's $35. I'd rather Amazon just pay the employees and spread that $35 cost among all 10 customers, rather then penalize the tippers. Of course in reality, Amazon wouldn't pay a whole $35, they'd pay much less, which is the whole reason corporations love the tipping culture, it saves them money.

And yet, tipping breaks out the costs. Amazon's price for goods is the same, regardless of which you charge (aside from the 1 hour delivery on Prime Now, or the overnight delivery on regular Prime). Then you have a suggested tip, which is designed for the consumer to pay extra to the courier for the added hassle of delivering in a 2 hour window.

I find hidden fees rolled into the cost of an item to far more aggravating than a broken out "tip" or "tax". Economically speaking, it allows for people to actually see how much things may actually cost.

[ISiddiqui]

Originally Posted by Logan

I don't know of a single one that is "free" with a suggested tip involved. If my lawyer is sending me a contract by courier, he's paying the service and I'm sure passing the fee along to me in his billable rate.

Of course. I find that far more aggravating. Obvious the service is costing the consumer more, but its all rolled up into one. It's far more of a money making scheme for the corporation that way, FWIW, than suggesting a tip.

[molson]

Originally Posted by ISiddiqui

(aside from the 1 hour delivery on Prime Now, or the overnight delivery on regular Prime)

Would you tip delivery people in those two situations? I'm sure they're working just as hard.

[bob]

Originally Posted by Arles

Given the low threshold for "tips" in today's society....

I think that's the actual issue people are having. Everyone wants a tip, no one wants to give exceptional service.

[Subby]

I will gladly pay someone $5 to go to the store, get exactly what I want, and bring it back to me. In 2 hours. I can't even argue with that.

I would much prefer this approach to having Amazon increase the price of Prime to $150 so I can subsidize a bunch of impulse control bereft shut-ins who order instant delivery every other day.

[ISiddiqui]

Originally Posted by molson

Would you tip delivery people in those two situations? I'm sure they're working just as hard.

I would definitely tip the 1 hour courier. Probably not the overnight shipper though. That guy is doing his regular rounds. The package just left the warehouse quicker (or moved to the front of the line).

[Logan]

Originally Posted by ISiddiqui

Of course. I find that far more aggravating. Obvious the service is costing the consumer more, but its all rolled up into one. It's far more of a money making scheme for the corporation that way, FWIW, than suggesting a tip.

I was using that as an example for every courier service in NYC charging a fee, and not operating under a tip based model.

As I said, my wife forgot her key this morning on her run. I'm already at the office. I can go back to Port Authority, get on the bus, go home, let her in, and then repeat my morning commute. Or I can log on to Uber, choose the Rush option, and pay about $20 to get some guy to come to me, where I hand him the key, and he gets it to her. I want a service, the service costs $20, and I pay for the service.

[Logan]

Originally Posted by Subby

I will gladly pay someone $5 to go to the store, get exactly what I want, and bring it back to me. In 2 hours. I can't even argue with that.

A lot of grocery stores offer this option. I think it costs around $10. That's the price of the service for them to take your list, gather all the items, and pack them for delivery. And I'd gladly pay the guy who actually shows up hauling the bags a tip on top of that.

[digamma]

1. What if the cost to Amazon is $3.50, but they charge a $5 fee (no tip) in order to generate additional revenue and profits? Does that offend you?

2. What if the delivery service or courier negotiated the rate with the tip structure, because they'd rather take their chance at batting better than .700 on tips rather than getting $3.50 a delivery from Amazon?

[Fidatelo]

Is it fair to assume that part of the reason for the tip, rather than an additional fee, is that Amazon plans to remove the courier from the equation as soon as possible? If they can get drones doing the 2-hour deliveries in the near future then they don't have to adjust prices. In fact, since drones will probably be phased in it probably helps with that intermediary period. "If a human shows up, kindly tip them $5. If it's a drone then no worries".

[Arles]

Originally Posted by Subby

I would much prefer this approach to having Amazon increase the price of Prime to $150 so I can subsidize a bunch of impulse control bereft shut-ins who order instant delivery every other day.

This is exactly right. The consumer is somehow going to have to pay for higher levels of response/service - so why not send the bill to the people that use it (via tips). I enjoy prime and sometimes choose the new "Next day" service for local items. However, I would rarely use same day and would be fairly aggravated if my yearly fee went up so that I now subsidize a bunch of people who do use it.

Tipping/extra fees for people who want service above and beyond the normal expectation seems fair for a system like this. Is there a better alternative I'm missing (outside of having all prime members subsidize it)?

[ISiddiqui]

Originally Posted by digamma

1. What if the cost to Amazon is $3.50, but they charge a $5 fee (no tip) in order to generate additional revenue and profits? Does that offend you?

2. What if the delivery service or courier negotiated the rate with the tip structure, because they'd rather take their chance at batting better than .700 on tips rather than getting $3.50 a delivery from Amazon?

Let's be honest, if Amazon starts charging a flat fee of $5 extra for 2 hour delivery, they are likely going to be keeping most of that money (so what you are saying would be right on, but I am guessing Amazon gets closer to $4 of that $5 fee).

[digamma]

Yes, I was just using the hypothetical numbers put forth in post 106.

[Logan]

Originally Posted by digamma

1. What if the cost to Amazon is $3.50, but they charge a $5 fee (no tip) in order to generate additional revenue and profits? Does that offend you?

I assume this is what happens with virtually all delivery fees...there's margins everywhere, so no, this doesn't offend me personally. If they explicitly said "we're charging you $5 because that is how much it costs us to provide the service to you" but it actually only cost $3.50, I'd have a problem with that.

[Logan]

Originally Posted by Arles

Tipping/extra fees for people who want service above and beyond the normal expectation seems fair for a system like this. Is there a better alternative I'm missing (outside of having all prime members subsidize it)?

Agree. But these are two entirely different things. That's what I'm speaking about at least.

[digamma]

Originally Posted by Logan

I assume this is what happens with virtually all delivery fees...there's margins everywhere, so no, this doesn't offend me personally. If they explicitly said "we're charging you $5 because that is how much it costs us to provide the service to you" but it actually only cost $3.50, I'd have a problem with that.

I understand that. I'm just trying to figure out what the real contention is here. It doesn't make a ton of sense to me that we're ok with corporations seeking to make a profit by increasing revenue, but we're not ok with it if they do it by reducing costs--particularly when we don't know the labor side of the equation.

[molson]

Originally Posted by Arles

Tipping to me is associated with a service provided that goes above and beyond the "normal expected"

I always associated tipping with employee's individual efforts and service, not how impressive the company's product and manner of delivery is.

If a local pizza company sets up some system where they have a ton of locations and can get me a pizza in 2 minutes, that's pretty cool. But I don't see why that driver is personally more entitled to a tip than the guy in his shitty car who went through traffic and got me a pizza in 30 minutes. The "above and beyond" in the first example is all about the company and its system, so I would expect to pay that company more for its better system. It wasn't the driver that made the difference. He's not working any harder, he's just delivering more pizzas in a more efficient system. If anything, the driver in the worse system, or the UPS driver with a truck full of packages he got late, and has to get out by a deadline, is working harder and is more deserving of extra compensation direct from the customer.

Edit: Related to this is the whole fiction we've bought into that carrying an $8 beer to your table is more worthy of a tip than carrying a $4 beer to your table. I've submitted to the cultural norm on that one, but I will tip a higher % at a busier, cheaper restaurant than an expensive one.

[Arles]

Originally Posted by molson

I always associated tipping with employee's individual efforts and service, not how impressive the company's product and manner of delivery is.

If a local pizza company sets up some system where they have a ton of locations and can get me a pizza in 2 minutes, that's pretty cool. But I don't see why that driver is personally more entitled to a tip than the guy in his shitty car who went through traffic and got me a pizza in 30 minutes.

But I look at it as the quality of service. For pizza delivery, it's the quality/condition of the pizza and the speed at which it is delivered. The establishment should setup a process through most drivers by which I get both in good quality. It makes no sense to tip a guy who brings colder pizza 30 min later the same as a guy who brings hot pizza in just 5 minutes. Granted, it might not be the "driver's fault", but he gets credit/blame for the process his workplace sets up for him to work under.

The "above and beyond" in the first example is all about the company and its system, so I would expect to pay that company more for its better system. It wasn't the driver that made the difference. He's not working any harder, he's just delivering more pizzas in a more efficient system.

I guess that's a distinction without a difference to me. If a driver is a complete f-up and still delivers me good, quality pizza in 5 minutes: he's getting a better tip than the "James Brown of pizza delivery" who is forced to go across town on his route and gets me colder pizza much later. Even though the latter guy works harder, my focus isn't on the work ethic of each driver, but rather on the quality/timeliness of the pizza I receive.

[digamma]

Originally Posted by molson

Edit: Related to this is the whole fiction we've bought into that carrying an $8 beer to your table is more worthy of a tip than carrying a $4 beer to your table. I've submitted to the cultural norm on that one, but I will tip a higher % at a busier, cheaper restaurant than an expensive one.

Just so we're clear, cultural norm = market.

[molson]

Originally Posted by Arles

Even though the latter guy works harder, my focus isn't on the work ethic of each driver, but rather on the quality/timeliness of the pizza I receive.

That doesn't make any sense to me, but it helps me understand the differences of opinion on the Amazon thing.

I'm tipping more, (at least as a %), for great service giving me a mediocre product than I am mediocre service giving me a great product. Because IMO, tipping is about service of the individual employee, not about how well the company works. I expect how well the company works to be reflected in the cost of the product.

[Arles]

So, if a bartender mixes a crappy drink, but is super busy and nice to you - you would tip more than a normal bartender who makes a great drink but isn't that busy? I'm all for rewarding effort, but the product is the essential piece of the equation. Give me a crappy product and that pretty much ruins the experience - no matter how nice you are when you hand me the plate of sh*t.

[molson]

Originally Posted by Arles

So, if a bartender mixes a crappy drink, but is super busy and nice to you - you would tip more than a normal bartender who makes a great drink but isn't that busy? I'm all for rewarding effort, but the product is the essential piece of the equation. Give me a crappy product and that pretty much ruins the experience - no matter how nice you are when you hand me the plate of sh*t.

In that example the bartender is responsible for the crappy drink. A pizza delivery guy usually isn't the same person that made the pizza, and a waiter isn't usually the same person that made the food. On the flip side, if a Amazon courier gets me a package in 2 hours, or if a pizza delivery person from the place next door gets me pizza quickly, it's not due to the amazing ability of the employee - they didn't design the Amazon 2 hour courier system and they didn't strategically put the pizza places to ensure fast delivery.

Edit: I'm assuming you meant that the bartender made a crappy drink because of lack of skill or effort. If I just ordered a shitty beer or cheap drink or something, I absolutely would tip that bartender more for it (at least %-wise) if he was a good bartender, than I would an inattentive bartender who made me a very expensive drink. %-Wise, the biggest tips I leave are for the bartender at the dive bar down the street who makes my cheap drinks very strong and always takes my order right away, and for the waitresses at the cheap 24-hour diner down the street. I'll go as high as 40-50% for those people and I won't hesitate to do 10% for shitty service at a nicer place with a better product. Because the tip is for the service, not the quality of the product. With Amazon, the 2-hour courier thing is the product. It's not something special and extra that the employee is doing, its the entire nature of the PRODUCT that dictates that it be there in 2 hours. It's what you're paying for in the first place.

[Arles]

OK, so a waiter brings you crappy food, but he's nice about it. Or, a waiter isn't as helpful, but brings you a great meal. Who do you tip more?

[molson]

Originally Posted by Arles

OK, so a waiter brings you crappy food, but he's nice about it. Or, a waiter isn't as helpful, but brings you a great meal. Who do you tip more?

I'd tip the first waiter more, %-wise. I'm tipping on service. The waiter has no control of the quality of the food. I'm not going to punish a waiter if a cook screws up, or if I just subjectively don't like something.

[Arles]

I can't ever think of a situation where I tipped a waiter over 15% after having a bad meal. Yeah, it kind of sucks that the waiter's payment is partially due to the cook. But, I'm tipping on the dining experience and given I can't really tip the chef or even the restaurant GM, the waiter is the beneficiary/debtor of that experience. I can think of many times where I had a great meal with an average (or even below average) waiter and tipped him over 20%. I can't think of many 20% tips for a crap meal though.

[NobodyHere]

If I had great service but a poor meal, I would probably give a good tip but never go back to that restaurant.

[corbes]

You guys seriously calculate tip percentages like this for every meal?

[ISiddiqui]

Well, I generally give 20%, which is kind of easy to figure out (move the decimal, multiply by 2). But for bartenders I know or good service, it can easily go to 30% (that's a multiple of 3 ). It's not difficult.

[corbes]

Yeah I meant all these sliding-scale assessments of quality vs. product vs. the hardest working man in show business vs. market strategies vs. labor-supply vs. flux capacitators etc.

[molson]

Originally Posted by corbes

Yeah I meant all these sliding-scale assessments of quality vs. product vs. the hardest working man in show business vs. market strategies vs. labor-supply vs. flux capacitators etc.

Ha, kind of. I'll do 15% or 20% and round up or down a little. I find waiter service really doesn't vary that much these days and/or I'm pretty low maintenance. I can't remember the last time a waiter actually screwed up an order. At dive bars and cheap diners I just go way higher %-wise if they're friendly and take my orders right away. Of course it's a % of a cheaper tab. But a super-fast bartender who is liberal with the alcohol and good diner waitress are so much more valuable to me as a service than a regular restaurant waiter, who are pretty much all the same.

[ISiddiqui]

Originally Posted by corbes

Yeah I meant all these sliding-scale assessments of quality vs. product vs. the hardest working man in show business vs. market strategies vs. labor-supply vs. flux capacitators etc.

Unless you give everyone the same percentage every time, I don't see how you don't do this?

[BigPapi]

Wal-Mart responds with it's own sale next week to counter this Amazon Prime attention whore. Loving this quote from Wal-Mart :

"We just don't believe you should pay a fee to get a better price," said Walmart spokesman Ravi Jariwala.


.....really Ravi- ever shop at Sam's Club??? You know, that OTHER Wal-Mart store. What a ridiculous statement.

[molson]

Walmart should just slash everyone's hourly wage and recommend that we all tip the cashiers.

[Barkeep49]

If you have a bad, or good, experience at a restaurant the way to communicate that is to talk to a manager. Sending a "message' via tip is unlikely to be noticed unless you are unusually generous or tip nothing. People vary so widely in their "standard" amount and whether they tip pre or post tax that 15% could just be seen as your normal amount not a "penalty" for a poor experience.

[Chief Rum]

Exactly. The way to deal with bad food is to tell your waiter and he will either get it fixed or discount it or get a manager, which is his job. If it's not fixed to your satisfaction but the waiter did everything within his power to fix it, then I don't think you should punish the waiter for that. Leave an appropriate tip and either don't go back to the restaurant, or go a lot less often (or give them a bad Yelp review).

[RainMaker]

Looks like they're now targeting people who share their Prime accounts. Seems like people are grandfathered in for now but who knows if that holds when the next renewal comes along.

Sharing Amazon Prime benefits just got harder - Aug. 3, 2015

I wish they'd offer a Prime just for shipping. Seems like the price increase and now this is to help fund their music and video offerings. I honestly don't care about either. Would be a shame to keep increasing the price for a bunch of shitty TV shows and C-level movies.

[ISiddiqui]

::shrug::

To be honest, I see the price increases as mostly for shipping. Shipping costs have risen since Prime started. While gas prices are down from their peaks, they are definitely higher than when Prime started.

[Drake]

Originally Posted by RainMaker

Looks like they're now targeting people who share their Prime accounts. Seems like people are grandfathered in for now but who knows if that holds when the next renewal comes along.

Sharing Amazon Prime benefits just got harder - Aug. 3, 2015

I wish they'd offer a Prime just for shipping. Seems like the price increase and now this is to help fund their music and video offerings. I honestly don't care about either. Would be a shame to keep increasing the price for a bunch of shitty TV shows and C-level movies.

I guess I don't understand this. Why would anyone expect to be able to share Prime with anyone outside of their family? (Everyone in my house uses one Amazon account.) If I had a roommate, I'd expect them to have their own Prime account or do without the two-day shipping (...and all of the other Prime stuff that I never actually use.)

[Logan]

I remember a couple years ago being surprised that I was able to send one of my niece's a birthday gift using Prime shipping for no extra fee. Fast forward to today and we have four addresses saved that we've used to send gifts to all of them.

[Barkeep49]

Originally Posted by Logan

I remember a couple years ago being surprised that I was able to send one of my niece's a birthday gift using Prime shipping for no extra fee. Fast forward to today and we have four addresses saved that we've used to send gifts to all of them.

I think you can still do this. It's just that you wouldn't be able to give your niece your account (unless you want her to have access to your credit cards).

[Logan]

Originally Posted by Barkeep49

I think you can still do this. It's just that you wouldn't be able to give your niece your account (unless you want her to have access to your credit cards).

Yeah. I meant that showed me that you could conceivably share something like this in the first place, which is what I was surprised by.