Amazon is making a play for low-income shoppers. The online leader is offering a discount on its pay-by-month Prime membership for people who receive government assistance.
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The move, announced Tuesday, is seen by some analysts as an attempt to go after rival Walmart’s lower-income shoppers. The world’s largest retailer has revamped its shipping program and improved other services to drive online sales growth as it tries to narrow the gap with Amazon.
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People who have a valid Electronic Benefits Transfer card, used for programs such as the Supplemental Nutrition Assistance Programs, or food stamps, will pay $5.99 per month for the Amazon Prime benefits like free shipping and unlimited streaming of movies and TV shows.
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The typical Prime membership is $99 a year, but those who cannot afford to pay up front also have a $10.99-a-month option.
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Amazon designed this option to make its selection and savings more accessible, including the many conveniences and entertainment benefits of Prime, Greg Greeley, vice president of Amazon Prime, said in a statement.
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Walmart has gained momentum in its online business, seeing its e-commerce sales soar 63 percent in its first quarter, up from a 29 percent increase the previous period. It now offers free-two-day shipping for online orders of its most popular items with a purchase of $35. Online shoppers who collect their purchases at a store get extra discounts. And Walmart has dramatically expanded its online offerings — though it’s still far behind the hundreds of millions of products at Amazon.com.
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Amazon’s aim with the latest move is two-pronged, says Ken Perkins, president of research firm RetailMetrics.
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It is part of Amazon’s overarching goal to inexorably move into every corner of retail, he said. Secondly, it is a direct move to pull consumers away from its chief retail rival Walmart, which has been far more aggressive competing with Amazon…