Walmart is ending a free two-day shipping program it was piloting called ShippingPass, one that was intended to compete with Amazon's Prime service, though that's actually good news for customers. Instead of charging $49 per year for the benefit of expedited shipping on online orders, the company has chosen to offer free two-day shipping to home and stores on millions of items without a membership fee.
The caveat is that there is a minimum purchase required for free shipping to homes, which Walmart lowered from $50 to $35. Subscribers to Amazon Prime do not have to worry about making a minimum order—if all a customer wants is a $5 item shipped in two days to their house, Amazon will happily oblige. The way around this for Walmart shoppers is to have the item shipped to a local store. There's the inconvenience of having to pick the item up, but when shipping to a store, Walmart removes the minimum order restriction.
"I couldn’t be more excited. We are moving at the speed of a startup," said Marc Lore, president and CEO of Walmart U.S. eCommerce. "Two-day free shipping is the first of many moves we will be making to enhance the customer experience and accelerate growth."
More than two million items at Walmart qualify for free two-day shipping. Walmart claims these are "the items customers shop the most," such as baby necessities, pet products, cleaning supplies, electronics, food items, and so forth. In other words, a wide range of products will quality for two-day shipping.
How this aggressive move will affect Amazon remains to be seen. One thing Amazon has going for it is that Prime members receive numerous benefits that go beyond free two-day shipping. Prime members enjoy unlimited streaming of select movies and TV shows, unlimited ad-free streaming of more than a million songs, unlimited photo storage, and the list goes on.
Even so, things could get interesting in a hurry. Walmart says this is the just the beginning of more to come.