Walmart+ Challenging Amazon Prime with $98-a-Year Free Shipping Service

(Image credit: Walmart)

Walmart on Tuesday announced a new service offering, Walmart+, that designed to compete—even undercut—Amazon’s popular Prime service.

For $98 a year, Walmart+ will offer members free shipping on orders of $35 or more, covering more than 160,000 items. There’s a self-service checkout option using a smart phone app that will benefit members when they do venture out to Walmart stores. And Walmart+, which undercuts the $119-a-year Amazon Prime on price, delivers a 5-cents-per-gallon break on gas at Walmart stations. 

One of the big questions about the new service offering: Will Walmart+ include a video component, a la Amazon Prime Video, to draw users to the platform?

Presently, Walmart has partnered with Microsoft on a joint bid to acquire Chinese short-form video platform TikTok. Walmart and Microsoft are bidding against Oracle. Analysts peg the sales price to ultimately come in between $20 billion - $30 billion. 

Notably, Walmart sold its transactional video platform, Vudu, to Comcast’s Fandango division back in April. Vudu would have seemed like a logical starting point to build a multi-faceted video platform, a la Amazon Prime Video, that encompasses everything from SVOD to AVOD to transactional channels.  Walmart also has strong ties to content channels dating back to its leading position as a DVD retailer in the aughts. 

Speaking during a press call Monday, Janey Whiteside, Walmart's chief customer officer,.called Walmart+ “the ultimate life hack.”

For now, at least, analysts seem underwhelmed by the program

"My sense is they are going to do a bit more to entice people into this, because as it stands it's not a bad program but it's not a great program," Neil Saunders, an analyst at research firm GlobalData, told CNET. "When you look at Amazon Prime, it's just light-years ahead.”

Walmart+, Saunders added, also faces the wind drag of “subscription fatigue caused by more established services like Amazon Prime, Netflix and Spotify, which already have inroads to consumer credit cards. 

“For a $35 minimum and $98 annual fee, this is a thin gruel,” said Craig Johnson, president of Customer Growth Partners, a retail research and consulting firm, to the New York Times

Daniel Frankel

Daniel Frankel is the managing editor of Next TV, an internet publishing vertical focused on the business of video streaming. A Los Angeles-based writer and editor who has covered the media and technology industries for more than two decades, Daniel has worked on staff for publications including E! Online, Electronic Media, Mediaweek, Variety, paidContent and GigaOm. You can start living a healthier life with greater wealth and prosperity by following Daniel on Twitter today!