Amazon Prime Growth Plan: Where a 20% Revenue Lift Would Come From

Quick Overview

Product strategy case on growing Amazon Prime's revenue by 20%. It tests defining which revenue counts, breaking it into members and revenue per member, sizing levers such as acquisition, retention, pricing, tiers and add-ons, and protecting member shopping with guardrail metrics.

Amazon Prime Growth Plan: Where a 20% Revenue Lift Would Come From

Company: Zendesk

Role: Product Manager

Category: Product Design & Strategy

Difficulty: medium

Interview Round: Other

You are a product manager for Amazon Prime, and your goal is to grow Prime's revenue by 20%. How would you get there? ```hint Break revenue into its drivers Write Prime revenue as an equation, then ask how much of the 20% each term could realistically supply, instead of listing ideas one by one. ``` ### Clarifying Questions - Does "Prime revenue" mean membership fees only, or also paid add-ons, Prime Video advertising and the extra shopping members do? - Over what period should the 20% be reached, and is it measured globally or in one market such as the United States? - Are price changes and new paid tiers on the table, or must the plan leave the current membership price alone? - Are new countries in scope, or should the plan grow Prime where it already operates? ### What a Strong Answer Covers - A clear revenue definition, decomposed into paying members and revenue per member - Sizing how much each lever (acquisition, retention, pricing and tiers, add-ons) could contribute toward the 20% - Prioritized initiatives tied to specific member and non-member segments, with the reasoning behind the order - The effect of each move on the link between membership and shopping, including churn risk from pricing - Metrics and guardrails that track progress toward the target ### Follow-up Questions - A price increase alone could supply much of the 20%. Why might you still not lead with it, and how would you test it? - If your plan adds tiers, how would you keep them from confusing members or pulling existing members down to a cheaper plan? - Which member segment would you expect to churn first under your plan, and what would you do about it?

Overview: Product strategy case on growing Amazon Prime's revenue by 20%. It tests defining which revenue counts, breaking it into members and revenue per member, sizing levers such as acquisition, retention, pricing, tiers and add-ons, and protecting member shopping with guardrail metrics.

Zendesk logo
Zendesk
Feb 18, 2025
mediumProduct ManagerOtherProduct Design & Strategy
0
0

You are a product manager for Amazon Prime, and your goal is to grow Prime's revenue by 20%. How would you get there?

Clarifying Questions Guidance

  • Does "Prime revenue" mean membership fees only, or also paid add-ons, Prime Video advertising and the extra shopping members do?
  • Over what period should the 20% be reached, and is it measured globally or in one market such as the United States?
  • Are price changes and new paid tiers on the table, or must the plan leave the current membership price alone?
  • Are new countries in scope, or should the plan grow Prime where it already operates?

What a Strong Answer Covers Guidance

  • A clear revenue definition, decomposed into paying members and revenue per member
  • Sizing how much each lever (acquisition, retention, pricing and tiers, add-ons) could contribute toward the 20%
  • Prioritized initiatives tied to specific member and non-member segments, with the reasoning behind the order
  • The effect of each move on the link between membership and shopping, including churn risk from pricing
  • Metrics and guardrails that track progress toward the target

Follow-up Questions Guidance

  • A price increase alone could supply much of the 20%. Why might you still not lead with it, and how would you test it?
  • If your plan adds tiers, how would you keep them from confusing members or pulling existing members down to a cheaper plan?
  • Which member segment would you expect to churn first under your plan, and what would you do about it?