Is it just inflation?

I recently received a reminder to renew my AMA Plus membership.  2018 marks my 10th anniversary of having an AMA membership.  I pay in annual lump sum payments as it’s cheaper than the monthly option.  I was curious how much they’ve charged for the service over the last decade.  Have a look as I think it’s kind of interesting.  Here’s what I see:

  • In 2008, they charged me about $123 for the year for my initial sign up.  At this point since it’s a new service and we don’t have a baseline, we’ll use this as are reference frame
  • The following year, which is presumably the most likely period one would choose not to renew if they didn’t use the service, AMA greatly discounted the service making it far more likely that if someone was on the fence they would renew “just because”
  • You’ll note that from year 3 to year 9 the price increases at a nearly perfectly linear rate.  The jumps aren’t massive but if we look at the different of the 2009 payment compared to the 2016 payment we see it increased by a non-trivial 16%
  • Then, oddly, right before the end of the 10 year duration which is the next psychological marker, the price drops again.  Coincidence?
  • If you still renewed, then they know that they’ve got you and you won’t easily leave so what do they do, they increase the price by a larger amount than any previous period

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All and all, the delta from the cheapest period to the most expensive is nearly 20%.  Recall that during this period, the membership plan remained constant with no changes and only one call was ever made to AMA in 2017, which coincidently is where the drop occurs.  The data suggests I should call in for service calls more often to get a greater discount on my renewals.  Therein of course lies the danger of drawing conclusions from this kind of data.

Now what happens if we compare this to inflation?  According to inflationcalculator.ca, a product that cost $123 in 2008 would cost $140.50 in 2018.  AMA is actually slightly under that.  It would seem the price increases really are just to cover inflation.

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I found it interesting and figured I’d share.

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