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Illustration: Aïda Amer/Axios
Companies like Amazon are tacking on new fees and surcharges on top of the regular subscription fees they already charge.
Why it matters: Subscription fatigue is real and growing, testing the limits of consumer appetites for convenience.
Driving the news: Amazon announced the launch of a $9.99 a month unlimited grocery delivery subscription benefit Tuesday that is available in more than 3,500 cities and towns across the U.S.
- The benefit works on orders over $35 from Whole Foods Market, Amazon Fresh and local grocery and specialty retailers available on Amazon.com.
- Low-income customers get a discounted fee of $4.99 per month without a Prime member if they have a registered EBT card, Amazon says.
Between the lines: Adding on the grocery feature will cost $120 a year for the average Prime member who already pays $139 a year, or $14.99 a month.
- That's on top of the new $2.99 optional fee for consumers choosing the ad-free Amazon Prime Video option that launched in late January.
- Amazon also has monthly ad-on options for RxPass from Amazon Pharmacy at $5 per month and $9 per month for One Medical (or $99 annually).
The big picture: Though consumers have been increasing scrutiny over their growing number of subscriptions, analysts say there's still room for the ones that check the right boxes.
- Consumers "seem increasingly willing to subscribe to time-saving services, and Amazon's subscription economics likely make sense for those that shop multiple times a month," Bank of America analysts wrote yesterday.
- Amazon has a "slight advantage" with fee-weary consumers, GlobalData managing director Neil Saunders tells Axios, because this is an add-on to its existing program.
Zoom out: The same-day delivery wars have been heating up with Walmart and Target recently adding speedy new services that rival Amazon.
- Target Circle 360 debuted earlier this month with an introductory price of $49 a year for unlimited same-day deliveries for orders $35-plus.
- Walmart+ costs $98 a year or $12.95 a month. The retailer launched an early morning on-demand delivery service in March which comes with a $10 express fee for members.
The bottom line: Convenience comes at a price.
- Depending on your Amazon add-on selections, multiple subscriptions can more than double the cost of Prime.
Editor's note: The headline on this story has been clarified to note that the fees are add-on services.
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