Walmart recently introduced free, two-day shipping for all orders with a minimum of $35 worth of merchandise, and now Amazon has dropped its free shipping minimum to the same level.
About a year ago, Amazon increased its free shipping minimum to $49 for non-members of Amazon Prime (Prime member get free two-day shipping on everything), so this marks a reversal in strategy for the online retail giant.
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The move reflects increased competition online from Walmart, which has eliminated its Prime-like membership program, ShippingPass. For those who aren’t Amazon Prime members, the Walmart offer is a better deal, assuming that the merchandise is similarly priced, since non-Prime members don’t get guaranteed two-day shipping.
Consumers have benefited from the battle for their online dollars, as prices continue to fall. Walmart’s online sales were up nearly 30 percent last year, thanks to aggressive promotions and the acquisition of Amazon competitor Jet.com.
While Walmart is the largest retailer in the world, it lags behind Amazon in online sales, and the company is focused on closing that gap. In addition to fighting for consumers, Wal-Mart has been building infrastructure such as warehouses and shipping systems to allow it compete with Amazon.
Amazon’s sales last year were $136 billion, more than 10 times Walmart’s online sales. Walmart’s overall sales, however, were nearly $500 billion.
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Now that both Amazon and Walmart have lowered their free shipping threshold to $35, expect other online retailers to follow suit.
