Amazon and Coffee

Announcing Amazon Prime
Amazon just announced that you can pay $79 and get a year’s worth of superfast shipping in exchange. For anyone buying more than a few items a month, it’s a no brainer.

But this has nothing to do with saving money on shipping and everything to do with Amazon’s innate understanding of human nature. Once you buy in, every single time you buy something from any other store (online or off) you’ll say to yourself, "ouch, I can’t buy this here. I’ll be wasting the money I spent at Amazon."

I love the idea that you can pay a lump sum and get a discount going forward.

The Soy Luck Club, my favorite place in New York, just announced the breakfast club. Pay $40 or so and you get breakfast every day for a month. "Grab and go" it’s called. If Vivian sells 100 memberships, it’s a home run. With $4000, she can certainly buy a lot of whole wheat bagels and grapefruit, and she ends up creating a cadre of super loyal customers. Best of all, she starts finding products for her customers instead of finding customers for her products.

Imagine a new chain of cafes that offers a coffee club. For a flat fee, you get all the wifi and lattes you can handle. With the markup on both, the owner does great, and people would feel terrible every time they strayed.

They say to ignore sunk costs. People are terrible at that, though.