Dive Brief:

• Amazon is looking into add shipping options for merchants selling on its site, including shipping directly to Prime members.

• “Ship by Region” would allow merchants to limit free two-day shipping offers to certain areas. "As part of this limited test, sellers have the option to designate a region in order to save on their resources – as long as they guarantee unlimited free two-day shipping," Amazon noted in an email.

• Prime members outside of that region will not notice the added selection, but can continue to shop the 20 million items that quality for Prime's unlimited free two-day shipping. "When Prime members shop, they are logged into their Amazon account and their Prime member benefits are visible based on their preferred shipping address. No one has to enter a zip code. We are working to make the shopping experience as easy as possible," Amazon says.

Dive Insight:

Adding ways for merchants to improve their reach to customers is also another way for Amazon to expand Prime’s benefits, by creating that many more orders on which Prime members could exercise their benefits. "The ability for sellers to ship directly to Prime members is still a test AND the ability to designate a region is a still a test," an Amazon spokesperson said in an email. "Both are new and we are excited to get feedback from our sellers and members on these programs."

Amazon is likely looking for more ways like this, in the small cracks and crevices of possibility for its merchants and its members. 

After all, Prime membership has become a formidable thing. Prime members convert 74% of the time on Amazon, according to Millward Brown Digital, compared to 13% for non-prime members, and they have a preference for Amazon, converting 6% of the time at other warehouse retailers’ e-commerce sites. If membership growth for Amazon Prime continues at its current pace, half of all U.S. households could be Amazon Prime members by 2020.

“Ship by Region” could be a cumbersome proposition, though, so we’ll see whether it flies. Right now, shoppers see the “Prime” symbol next to a product, an indication that the item will arrive in a couple of days for free for Prime members. Any “Ship from Region” limitation would entail Prime members entering their zip code.

Still, the move is another way that Amazon has found to potentially flex its Prime muscles. And it’s also an answer to the new competition from Jet, which is built on offering ways for its members to save money on the fulfillment side.