Wal-Mart wants in on Amazon’s Prime Day
July 13, 2015 02:30 PM
Wal-Mart Stores Inc. isn’t about to let its chief online rival hog all the spotlight this week. As Amazon.com Inc. prepares to offer big deals Wednesday for members of its Amazon Prime loyalty program, Wal-Mart began offering new discounts today for all consumers. It also has lowered it minimum threshold for free shipping to $35 from $50, matching what Amazon charges consumers who are not part of Prime, which provides free two-day shipping as part of the $99 annual fee.
Wal-Mart, No. 3 in the Internet Retailer 2015 Top 500 Guide, isn’t hiding the fact that these moves are in response to Amazon’s Prime Day on Wednesday, which will be a day of deals only for Prime members.
In a Monday blog post titled “Why Every Day is Low Price Day at Walmart,” Fernando Madeira, president and CEO of Walmart.com, says July 15 “and every other day” consumers should enjoy low prices. “We’ve heard some retailers are charging $100 to get access to a sale. But the idea of asking customers to pay extra in order to save money just doesn’t add up for us. We’re standing up for our customers and everyone else who sees no rhyme or reason for paying a premium to save.”
Walmart.com customers will see thousands of deals beginning this week, and the free shipping threshold will remain at $35 all summer, Madeira adds.
Walmart.com also is taking on Amazon, No. 1 in the Top 500, in a very public way on its home page with a large banner saying “Dare to Compare. Top products. Lower prices. Check for yourself.” An asterisk on Lower Prices denotes products priced at or below Amazon’s prices.
J.C. Penney Co. Inc. also wants in on the action, as it's planning a one-day event on the 15th with 25% off regular, sale and clearance products, according to a spokeswoman. J.C. Penney is also lowering its free shipping threshold to $49 from $99.
Earlier this month, Amazon announced plans for its first Prime Day sales event. New and existing members of Prime will have access to Lightning Deals and Deals of the Day, with some deals offered every 10 minutes.
One Forrester Research analyst thinks the day will be a success for Amazon, given that its customers are fond of sales discounts, but it’s highly unlikely Amazon will experience volumes that can compare to Cyber Monday levels. “Amazon rarely, if ever, does promotions like this—and given it's only one day, and only available to Prime members, purportedly on a finite number of items—it is unlikely to make too huge of an impact on the business,” says principal analyst Sucharita Mulpuru. “If we see more of these promotions come along however, then it might imply a bigger statement about Amazon's demand generation issues. But this is such a one-off, it's hard to do that."
Cyber Monday, the first Monday after Thanksgiving, was the biggest online shopping day of the year in 2014, with U.S. online retail sales of $2.038 billion, according to web measurement firm comScore Inc.
Wal-Mart’s response to Prime Day came shortly after the world’s largest retailer announced plans to test its own version of Prime dubbed ShippingPass. The pilot program offers free delivery in three days or sooner for $50 per year—half the Prime membership price.
Other online retailers like QVC Inc. (No. 15), Target Corp. (No. 16) and Wayfair LLC (No. 33) are running summer promotions to online consumers this week, but none appears to be in response to Prime Day. Target’s current “Black Friday in July” sale, for example, happens every year, according to a spokesman. A Wayfair spokeswoman says the retailer has no plans around Prime Day.
QVC was not immediately available for comment on their plans for any special promotions this week.