The massive retailers recently announced its own subscription service which launches after two weeks. Upon this announcement, the news was received favorably by Wall Street as the company’s shares shot up by 6 percent and the stock hit a new 52-week high. Additionally, its market cap rose to $418 billion.
The retailer’s upcoming membership program and its perks will launch on 15th September. It will cost $12.95 every month or $98 every year. Members of Walmart + will gain access to unlimited free home delivery of more than 160,000 items sold in its stores. The delivery includes groceries, as long as they spend at least $35 on every order. Members will also gain access to discounts of up to 5 cents a gallon for fuel and have access to a Scan & Go app that lets shoppers skip the checkout line.
Walmart makes shopping more accessible and helps families save money
Janey Whiteside, the company’s chief customer officer, downplayed the company’s objective as a competitor to Amazon Prime and instead described the new service as a “life hack” that makes shopping more accessible and helps families save money. The company aims to continue adding benefits.
However, this doesn’t mean customers won’t compare Amazon Prime to Walmart +. They will likely face the dilemma of which program they should pay for, or decide whether they can afford both. While knowing whether Walmart shoppers would be willing to pay for the programs remains undecided, this move could potentially increase its sales.
Walmart + slightly cheaper than Amazon Prime
The retail giant expanded its wallet share during the pandemic and increased its customer base across many categories. Additionally, the program is slightly cheaper than Amazon Prime, which costs $12.99 a month or $119 every year. However, Amazon Prime also includes an expansive library of movies and TV shows and lets customers order a single, low-priced item, such as a shampoo or lightbulb and ship it to their home without any minimum order fee.
According to Moody’s retail analyst, Charlie O’ Shea, Walmart aims to expand its grocery segment unlike Amazon Prime which also additionally offers a large “content universe”.
Currently, Walmart + will only be available to customers in the United States and members of Delivery Unlimited, a grocery delivery subscription service that offers flat rates will automatically become part of Walmart +.
The pandemic also encouraged customers to explore new ways of shopping, like getting large bags of groceries on their doorstep. For a retailer to increase and retain the usage of its loyalty program or subscription service, it needs to offer personalized programs to its customers and continue adding value. By gaining insights, it can help customers continue engaging with their brand.
