Amazon’s most of the revenue is earned by its “Amazon Prime” membership club as it quite a facility to avail for free shipping on most of the items, streaming videos, access to private-label food, and many more at just $99 per year. That is alone enough reason for Amazon to earn over 50 million subscribers.
An effective success that has garnered upscale for the company might also be the reason for holding back the company in competition with its arch-rival.
Walmart, an ace competitor and U.S nation’s number one food chain has around 12,000 stores in countries. Costco, the warehouse chain has only 700 or so stores across the nation but has 80 million members and is known to be nation’s number one retailer of beef, organic food, and rotisserie chicken.
To compete in the food retail sector, Amazon’s prime membership price might be a little top notch. It is well-known that Walmart’s revenue is directly proportional to its lower-income shoppers; full 20% of Walmart’s revenue has been passing from purchases made with food stamps.
To meet the lower-income customers’ expectation, the ingenious company has announced to cut the price of membership in Prime. Greg Greely, VP of Amazon Prime said:
“We designed this membership option for customers receiving government assistance to make our everyday selection and savings more accessible, including the many conveniences and entertainment benefits of Prime.”
But it seems this time Walmart has also learned the art to strike, keeping no stone unturned, it has purchased online retailers Jet.com and the fashion site Modcloth.
Well, well, isn’t this an announcement of arrival of a new battle.