Shipping perks aren’t the pull for Prime members. It’s the enhanced experience.
Walmart today announced its counter to Amazon Prime: A free two-day shipping model that doesn’t require a membership. Shoppers need only spend more than $ 35 to benefit from the new deal, which is no doubt powered in some form by Walmart’s acquisition of Jet.com last year.
The new 2-day shipping model replaces Walmart’s ShippingPass, a low cost alternative to Amazon Prime that ostensibly underperformed for the massive retailer.
While this new model is sure to bolster Walmart’s eCommerce endeavors, the chances that Walmart will ultimately dethrone Amazon through this initiative are probably slim, largely because Walmart is attempting to match plans with a multimedia subscription service that only seems to be expanding.
Amazon Prime’s value isn’t in its retail quality-of-life service, it’s in the way the company has deeply integrated Prime membership across its ecosystem. Everything user do under the Amazon umbrella is enhanced with a Prime membership.
Members gain access to Amazon’s Netflix parallel, its music streaming service, deals during Black Friday, Cyber Monday, and Amazon’s own Prime Day, as well as rolling all of this into the massively popular Alexa virtual assistant.
Of course, Walmart too has a streaming service (it bought Vudu in 2010, and offers free ad-supported streaming of older films), and its stores have always been a prime target during the Black Friday shopping rush. Yet this hasn’t been enough to close the gap between the two businesses, and Amazon continues to reign as the great retail power of the day, despite Walmart’s dominance of brick-and-mortar; a dominance that counts for less as the retail giant struggles to compete with Amazon’s staggering growth.
Walmart may even lose its grip on physical retail, as both Amazon and Google have announced brick-and-mortar stores, with Amazon’s in particular sure to bring about a new way of shopping. It’s perhaps in the case of Amazon Go that the differences between the two companies is the most clear, or at least ultimately indicative of why Walmart’s new shipping model is way too little and far too late.
Amazon Go’s most notable feature is its abandonment of checkout lines. Shoppers instead have their Prime accounts charged after they leave the store. This is the kind of pure innovation Walmart has as yet failed to duplicate.
Walmart has been behind the curve throughout the rise of digital commerce, and despite two-day shipping, its media streaming, and overall shopping experience simply pale in comparison to the holistic digital experience customers receive through Amazon; an experience which Prime only enhances. That a $ 100 a year Prime subscription also buys free 2-day shipping is a perk, not the sell.