10 Sneaky Ways Amazon Gets You To Spend More

Selling everything from books to pocket-sized cannons for your desk, Amazon is an online mega-retailer like no other. The company has earned a reputation for offering budget-friendly prices and free and fast shipping, but all that convenience comes with a high price tag for the sales giant.

To continue offering speedy shipping for your Amazon purchases, the company finds many ways to boost its income through what customers spend — maybe even without your noticing.

Amazon uses a highly sophisticated algorithm to recommend the right products to the right customers, at just the right times. The company has access to data that allows it to analyze behavior from customers and use the information to recommend products to other shoppers with similar profiles.

According to Vadim Bichutskiy, former director of data science at Innovizo, Amazon has pioneered a data-driven strategy for cross-selling and upselling.

“As an avid reader, I buy lots of books on Amazon, and on many occasions, I have taken advantage of its ‘Frequently Bought Together’ and ‘Customers Who Bought This Item Also Bought’ features,” said Bichutskiy. “Not only did I enjoy the books, but I never would have known about them without these recommendations.”

GOBankingRates Tip for Amazon Shoppers: Impulse Buys

Amazon’s personal recommendation engine is designed to show you items you are likely to buy based on your browsing and purchasing history. Make sure to stick to a shopping list instead of adding everything to your cart that is sponsored by your algorithm. You should also make sure you aren’t too heavily trusting sponsored reviews, as this may fill you with false confidence.

Free shipping isn’t free for Amazon, and the company has to make up its losses somehow. The goal of the free shipping offers is to incentivize customers to pay extra for Prime memberships or get them to increase the number of items in their carts to hit the minimum. The strategy works — revenue from these incentives offsets Amazon’s annual shipping costs.

GOBankingRates Tip for Amazon Shoppers: Your Free Shipping Threshold

Amazon often offers free shipping on orders over a certain amount. This encourages you to add more items to your cart to avoid shipping fees, often resulting in your spending more than initially intended — so make sure you calculate the true cost of what you’re spending and not what you think you’re saving.

Amazon Prime is a customer loyalty program that was originally designed to get shoppers to spend more. Members can take advantage of incentives like free expedited shipping, same-day delivery, unlimited video and music streaming, early access to lightning deals, access to the Kindle Owners’ Lending Library and discounts on diapers, video games and more.

Amazon Prime has become a tool for acquiring new customers and building loyalty, so the company can make money off members in other ways, like video streaming and cross-selling, according to Fortune.

GOBankingRates Tip for Amazon Shoppers: Free Delivery May Cost You

The convenience and perceived value of Prime make members more likely to shop exclusively on Amazon, increasing overall spending. However, what you spend each month might be more than what you would spend on delivery fees in general, so subscribe accordingly.

Amazon Prime members have access to Prime Video, which lets them stream a number of popular TV shows and movies. However, Prime Video doesn’t actually make the company money directly.

Amazon has discovered that Prime members who use the free video streaming service are more likely to rent or buy movies from Prime Video than non-Prime members. Once customers get into the habit of streaming free videos, Amazon has a chance to sell them on renting or buying videos that aren’t available for free.

GOBankingRates Tip for Amazon Shoppers: Bundling Products

Amazon often suggests bundling products together for a discount. This tactic can lead you to buy more items than you initially planned, thinking you’re getting a better deal, but make sure you’re not biting off more than you can watch.

Amazon actually owned the patent for 1-Click ordering until 2017, when it expired, but the service has generated billions in revenue for the retail giant. Once customers store their credit card and shipping information on the servers, they can simply click once to place orders without going through the checkout process.

This frictionless ordering system is another way in which Amazon disconnects customers from how much they are actually spending and encourages impulse buying.

GOBankingRates Tip for Amazon Shoppers: Add to Cart

The one-click ordering feature removes the friction from the buying process. By eliminating the need to go through multiple steps to complete a purchase, Amazon makes it easy to make impulse purchases. By avoiding this feature, you can wait and save to make sure you really want to buy an item.

The next time you see a promotion for an Amazon Kindle, think twice before buying, as the “deal” might actually cost you in the long run. According to Business Insider, owners spend an average of $1,450 per year at Amazon, compared to $725 for customers who don’t own Kindles.

GOBankingRates Tip for Amazon Shoppers: Read the Receipts

Audible subscriptions with this online retailer can also sneak up on you, as they range between $7.95 to $14.95 per month. If you are not keeping up with your reading, chances are you’re also behind on your budget.

Amazon’s Prime Day is an event during which members enjoy access to a wide array of products at below-average prices. To lure more customers into taking advantage of this promotion, Amazon offers a free 30-day Prime membership, so anyone can participate in the event. By selling more Amazon Prime memberships, Amazon can increase its cross-selling opportunities and profits.

GOBankingRates Tip for Amazon Shoppers: Buying More Isn’t Saving More

Amazon constantly suggests additional items that complement what you’re buying. This cross-selling and up-selling, especially during Prime Days, can lead to increased spending as you add items to your cart that you hadn’t planned on buying.

Amazon’s Lightning Deals can be found throughout the website and on the Gold Box page. These deals are limited to one per customer and usually have very short expiration dates. Along with making the offers time-sensitive, Amazon creates a sense of urgency by displaying status bars that show the percentage of products already in shoppers’ carts and the percentage still available.

If you’re looking to save money on Amazon, you might want to steer clear of this section of the site and avoid the temptation to buy on impulse. Amazon is notoriously reticent about how much revenue it gains off these deals, but the company tends to double down on the strategy around certain holidays.

GOBankingRates Tip for Amazon Shoppers: Determining Deals

Amazon’s Lightning Deals and Daily Deals create a sense of urgency, encouraging you to buy quickly before the deal or limited time expires. These deals are always running, so don’t let the fear of missing out fiddle with your finances.

Echo is a wireless, voice-operated speaker that features artificial intelligence. It’s always ready to listen and can play music and games, set alarms, perform math equations and look up facts online. Additionally, Echo allows customers to purchase items from the company’s website without the use of a computer. Echo even has a friendly persona named Alexa, so you feel less like you’re interacting with a company and more like you’re shopping with a friend.

GOBankingRates Tip for Amazon Shoppers: Avoid Targeted Advertising

Amazon uses your browsing history and data from your previous purchases to show you targeted ads both on and off its platform, such as through these devices. These ads remind you of items you’ve looked at, but you don’t always need to buy the hype.

The Subscribe and Save program offers discounts on repeat purchases of everyday items. While it saves you money per item, it also locks you into regular spending, ensuring a steady stream of revenue for Amazon. You might be overestimating how often you use an item and what you’ll spend on it each month.

GOBankingRates Tip for Amazon Shoppers: Skip the Middle Man

Instead of housing products in expensive warehouses and losing money on free shipping, Amazon has started employing third-party sellers. Meanwhile, the company just sits back, relaxes and collects your money, when you could just shop elsewhere in order to find better deals.

Caitlyn Moorhead and Jordan Rosenfeld contributed to the reporting for this article.