Amazon Prime Video's new ads have raised a massive backlash. Now, a group of subscribers have filed a lawsuit against the company founded by Jeff Bezos for alleged "misleading" advertising.

The main accusation lies in Amazon's allegedly deceptive strategy. Specifically, these customers have alleged that, for years, Prime Video has been promoted as an "ad-free" platform, so they have criticized that the new plan with ads "goes against that approach with which they have sold their service for years", an aspect that could be considered as "misleading" advertising.

Despite the fact that Disney+ or Netflix already have plans with ads and spots in their subscriptions, it has been Amazon that has received a lawsuit in this regard.

Recently, Amazon communicated through an email sent to its subscribers that, as of January 29, 2024, it would start showing ads in the current subscription, at least in the United States. In this context, the company detailed that users could avoid ads if they pay an extra monthly fee. This extra remains in the United States at $2.99 per month for the Prime subscription or a total of $9 for the dedicated Prime Video subscription.

Ads on Prime Video have arrived first, in addition to the United States, in the United Kingdom, Germany, and Canada and, by the end of 2024, in other countries such as France, Italy, Spain, Mexico, and Australia.

Amazon's goal, for the time being, is to offer significantly fewer ads than cable TV and other streaming platforms. In this regard, in its press release, the company reiterated that the amount of ads shown will be significantly lower than what we are used to seeing on cable TV.

The issue with subscription services 

Following a report by FastCompany based on a previous report by CNBC, the price increase for streaming services is derived from years of heavy investments from media companies, which poured billions of dollars into streaming to both catch up with Netflix and future-proof their business as consumers are increasingly abandoning traditional pay-TV services.

Under pressure from Wall Street, Disney and its industry compatriots have decided that the days of cheap streaming are over—unless you’re willing to watch ads, that is.

Disney is not increasing the cost of the ad-supported Disney+ plan, which is priced at $7.99. The ad-supported plans of Hulu and Max also stayed the same, while other services increased the subscription fees of their ad-supported plans at a slower rate than their ad-free offerings. 

Netflix even got rid of its basic $9.99 ad-free plan altogether in July, forcing new subscribers to make a stark choice: Either pay $15.49 per month for an ad-free viewing experience or pay just $6.99 for the company’s newly launched ad-supported plan.

Steep price hikes for ad-free streaming to steer consumers towards ad-supported plans, and that gambit appears to be working. 

Disney CEO Bob Iger told CNBC in July that 40% of new Disney+ subscribers now opt for the service’s ad-supported plan. Iger professed that this number was higher than he had expected, adding that “advertising will be a significant factor” in the company’s streaming business going forward.

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Amazon has announced that from 2024, dealers will be able to sell cars on its website after reaching an agreement with Hyundai, whose cars will be the first to be purchased through the company's website, it confirmed in a statement. Thus, customers can buy new cars online and then pick them up or take delivery at their local dealership at a time that suits them.

Customers will also be able to search for available cars in their area based on various preferences, including model, trim, color, and features; choose their preferred car; and then checkout online with their chosen payment and finance options, all from the company's website.

Amazon has taken advantage of the Los Angeles Auto Show to announce the initiative together with Hyundai, the first brand to join such an agreement in the United States. Hyundai cars will be the first to be available for purchase from the U.S. online store, but Amazon has confirmed that other brands will join its catalog by the end of 2024.

Allied with Hyundai 

This project will be done via an alliance with the world-known automotive manufacturer Hyundai. 

"Hyundai is a highly innovative company that shares Amazon's passion for trying to make customers' lives better and easier every day," said Andy Jassy, CEO of Amazon. 

"Our broad strategic partnership should do just that, from changing the ease with which customers can purchase vehicles online to simplifying the use of Alexa in Hyundai vehicles for entertainment, shopping, smart home settings, and calendar checks, to enabling Hyundai to transform customer experiences and business operations by migrating to AWS. We look forward to inventing together for many years to come," said Jassy.

As part of this agreement, beginning in 2025, those who purchase next-generation vehicles from the South Korean automaker will be able to access the Alexa hands-free experience. Hyundai drivers will be able to ask Alexa to play music, podcasts, or audiobooks, set reminders, update to-do lists, and check calendars.

In addition, customers will also be able to control their smart home from the road, meaning that if certain functions in a home are linked to Alexa, it will be possible to ask it, for example, to heat the house, check that doors are locked or manage smart lighting systems.

The agreement between Amazon and Hyundai goes beyond selling cars. Hyundai has selected Amazon Web Services (AWS) as its cloud provider to "accelerate its digital transformation." Hyundai will prioritize business cases such as manufacturing and supply chain to help optimize production and minimize costs, security and disaster recovery for resilience, and connected vehicle development to deliver new features to drivers around the world. They have also designed a Master Builder training and certification program to train Hyundai engineers in critical cloud skills.

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Amazon has shared the results of its Prime Big Deal Days held on October 10th and 11th, where - following Amazon report- customers save over $1 billion on thousands of product deals in over 150 million items sold in only two days.  

This is the second year in a row that Amazon has kicked off the holiday shopping season before Black Friday with an exclusive two-day shopping event for Prime members. It helps members get everything they want and need quickly and reliably on hundreds of millions of items worldwide.

During the first Prime Big Deal Days, U.S. Prime members purchased more than 25 million items with same-day or next-day delivery, and hundreds of thousands of items were delivered within four hours of purchase. 

The fastest delivery in the U.S. on the first day of the event was 54 minutes in Ohio, ordered at 7:20 a.m. ET and delivered at 8:14 a.m. ET. The customer ordered a pasta attachment for a KitchenAid stand mixer and "The New Canning and Preserving Book." Amazon offers U.S. Prime members more than 300 million items with free Prime delivery.

What categories were bought more in the U.S. during Prime Big Deal Days?

The categoríes of apparel, beauty, home, and toys were the top-selling categories. Customers also purchased millions of Alexa-enabled devices, including Fire TV and Echo, which were top sellers. 

Apple AirPods Pro (second generation), BISSELL's Little Green portable multi-purpose carpet and upholstery cleaner, and Crest 3D white strips were among the best-selling offerings.

LANEIGE Lip Sleeping Mask, COSRX Snail Mucin 96% Power Repairing Essence and The Children's Place matching holiday holiday pajama sets for kids are among the top-selling creator favorites.

Squishmallows, Barbie Toy Boat Playset and Catan are among the top-selling toys in the U.S. For the first time, Prime members in the U.S. shopped holiday launch event deals beyond Amazon using Buy with Prime, with some of the most popular deals being purchased at Wyze, ALT. Fragrances and Moon Juice.

In addition, Prime members ordered more than 150 million items from independent sellers in the Amazon store, most of which are small and medium-sized businesses, with Clean Skin Club clean towels, Hula Home spray bottle and PicassoTiles 100-piece set among the top performers. selling small business products in the U.S. on the first day of the inaugural holiday event.

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Amazon Prime Day 2023 broke all records grossing over $12.7 billion in sales for the marketplace titan. Over the two days of Prime Day, customers bought more than 375 million items worldwide and saved 2.5 billion dollars on millions of deals, the company said.

The company, founded by Jeff Bezos has remarked on the importance of commercial partners, mostly small and medium-sized businesses, to offer this "wide selection" of products and added that it has been, textually, "the largest Prime Day event" in the company's history.

Amazon focused its Prime Day deals on SMB products more than ever before, and this year, SMBs Caraway, True Classic, and TUSHY increased their average daily sales through Amazon by more than 18x on the first day of Prime Day compared to 2023. 

Prime members purchased millions of Alexa-enabled devices, including Fire TV Stick (3rd generation) with Alexa Voice Remote, the best-selling product worldwide.

Curbside pickup exploded in the USA 

Curbside pickup was used by 20% of online orders on July 11, according to Adobe, highlighting the staying power of a service that gained traction during the pandemic. That's up slightly from last year.

Amazon holds Prime Day in July yearly to boost sales during the usually slow summer months. It also helps Amazon promote an early start to the back-to-school and college shopping period, according to JPMorgan analyst Doug Anmuth.

Since Prime Day began in 2015, other chains, such as Walmart with its Walmart+ week and Best Buy with "Black Friday in July," also jumped on board to capture shoppers' spending during the slow summer months.

Amazon shares Thursday morning were up about $2 to $133.

Spain consumers went for Amazon Prime essentials 

In Spain, top-selling products on Prime Day included everyday essentials such as Dodot Baby Sensitive diapers, Finish Powerball dishwasher tablets, Ariel All-in-One laundry detergent, and Scottex Original toilet paper; Amazon devices such as the Fire TV Stick 4K, Echo Dot (5th generation) and Kindle; small appliances such as the Honeywell TurboForce fan and COSORI air fryer; and electronics such as Apple AirPods.

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Amazon India is testing a new path to conquer the Indian market after shutting down its food delivery business last year: Now it is trying its hand at food payments at restaurants. The company has started a limited rollout of bill payments at restaurants using Amazon Pay.

This initiative is being rolled out in select areas of Bangalore with a limited number of restaurants. Users can go to Amazon Pay > Dining in the Amazon app to make payments using credit/debit cards, net banking, UPI, or Amazon Pay Later. Thus, Amazon India currently offers bill payment discounts at almost all the restaurants in the listing.

The company has yet to comment on whether they are testing this in any other cities. Amazon India spokespersons did not respond to a request for comment.

Food delivery giants Zomato and Swiggy are offering payments and discounts at the restaurant as they try to attract more customers. Earlier this month, Zomato launched its own UPI service in partnership with ICICI Bank for faster checkout and bill payment processing.

This new Amazon experiment is one way to succeed in attracting customers in India. There are huge challenges in this country, so it is challenging to reach smaller cities in the country, according to a report by investment firm Sanford C. Bernstein. The e-commerce giant claims that 85% of its customers are from tier 2/3 cities/towns.

Amazon India has a Lite Prime version

Early this year, Amazon tested in India a Lite version of its Amazon Prime subscription with a 33% price cut. 

The new Amazon Prime Lite subscription in India has a reduced price of 999 rupees per year, equivalent to approximately 11.30 euros, compared to the 1,499 rupees that usually cost the service, which is about 17 euros.

The differences in the Lite version are not to reduce the amount of content on Amazon Prime Video, but in exchange, they will not be able to watch HD content, limiting the quality to SD. In this subscription, Amazon will introduce ads, although, at the moment, it has yet to be known how it will do it. Nor will it be possible to access Amazon Prime Video content outside the applications for Android and iOS, although it is not known if they will serve the same for other platforms.

Strike and discontent 

According to a news released by India Today journalist Ankita Garg, over 2000 Amazon employees started a strike today due to poor working conditions, new office rules, and recent job cuts. 

The situation could potentially damage Amazon's capabilities in the next 24 hours or even completely stop the operations if the strike grows larger, with more employees joining it. 

So far, Amazon has not acknowledged the strike nor made any comments.

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The loyalty program Amazon Prime is not growing as fast as before. Consumer Intelligence Research Partners (CIRP) announced this during the international bargaining day Prime Day, in which only members of Amazon Prime can participate.

Between June 2017 and June 2018, the number of US Prime members increased with 10 million, bringing the total to 95 million US members. A year earlier, 38 million Americans subscribed to Amazon Prime.

CIRP bases the results on their own research among online shoppers. Amazon itself does not normally release this kind of figures. With the exception of the release of the number of 100 million members worldwide earlier this year.

CIRP thinks that the growth of Amazon Prime is decreasing because 59 percent of Amazon users are already Prime members. This means that they receive unlimited free orders and can watch films and series via Amazon Video. Measured by households, 75 percent of Americans would have access to the Prime program. It is probably not possible for Amazon to stretch the market more than this.

In May 2018, the subscription was substantially increased in price, the effect of which is not yet measurable due to the short time since the increase.

Prime members spend an average of $ 1400 at Amazon, while 'non-members' spend less than half of that amount.

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