In its second-largest acquisition, Amazon buys the company for $970 million.
Shoppers who own the retailer’s tablets and e-readers buy 50% more often than those who don’t, and they shop across more Amazon.com departments, according to new research. About 40% of Amazon customers own a Kindle device.
Aggressive pricing compared to Apple Inc., Samsung Electronics and other tablet manufacturers has helped Amazon.com Inc. put more of its Kindle tablet and e-reader devices into shoppers’ hands, and shoppers who own Kindles spend more on Amazon.com, too, according to the results of a new survey by Consumer Intelligence Research Partners LLC.
The research firm estimates that roughly 40% of all Amazon shoppers own a Kindle device and that those shoppers on average spend $1,233 with the retailer annually, which is $443, or 56%, more than the $790 non-Kindle owners spend with the retailer each year, it says.
CIRP surveyed 300 Amazon.com shoppers online from Nov. 15 to 18 about their Amazon purchasing behavior in the previous 90 days.
“One way to look at the Kindle Fire and Kindle e-reader is as a portal to Amazon.com,” says Mike Levin, partner and co-founder of CIRP. “Kindle Fire provides access to everything Amazon sells, while the Kindle e-reader has become the way that Amazon customers buy books, Amazon’s original product line.”
The latest line of Kindle Fire tablets, released in September, start at $139 for the 7-inch HD version and $229, $269 or $379, depending on the feature selection and screen size (7-inch or 8.9-inch). By comparison, Apple sells the 9.7-inch iPad starting at $499 and the 7.9-inch iPad Mini starting at $329. Samsung’s newest Galaxy tablet, the 2014 10.1-inch Galaxy Note, starts at $549.99, while its older 7-inch Galaxy Tab starts at $169.
Of the survey respondents, 28% own a Kindle Fire tablet and 21% own a Kindle e-reader. And 9% of Amazon.com customers own both devices, which Josh Lowitz, partner and CIRP co-founder says reveals “how well Amazon has done to drive sales of what amounts to a portal to Amazon.com.”
Two main factors contribute to why Kindle owners spend more on Amazon.com than non-Kindle owners, according to the survey. Kindle owners shop 50% more frequently on Amazon.com than non-owners and across more of the retailer’s departments and product categories (6.4 on average versus 5.5 on average for non-owners), it says.
Amazon did not immediately respond to a request for comment. It is No. 1 in the Internet Retailer 2013 Top 500 Guide.