For 50 million items, the basic Prime program offers free shipping in two days. But BFAds explains that Target's REDcard members actually get free shipping on anything they order online with no minimum.
Amazon is likely hoping that the cheaper free shipping threshold makes it better able to compete with Walmart for non-Prime members. In an interview with Retail Dive earlier this year, Keith Anderson, vice president of strategy and insights at Profitero, compared that to cable television customers who'd rather pay à la carte, rather than for a slew of channels they'll never watch.
Shoppers with Amazon Prime memberships, which cost $10.99 a month or $99 a year, get unlimited free two-day shipping on eligible items with no minimum along with other benefits like streaming TV, movies and music. Target has launched a pilot program where it's testing next-day delivery for certain home essentials. These customers have to order online and pick up their items at a Wal-Mart location. "The fact that Amazon didn't outright match Wal-mart's free shipping timeline shows their continued commitment to the recurring revenue Prime model".
A worker inside an Amazon warehouse.Getty ImagesAmazon is making it cheaper to qualify for free shipping. It has made this decision after Walmart added support for free two-day shipping on all orders under $35 without requiring any membership. Target now offers free shipping at that dollar amount ordered, but it only promises delivery in 3-5 days. It's less logical to see a place in the market for one-day delivery, assuming orders are placed by 1:30 p.m. The idea as it now stands, however, seems like an idea that may appeal to Target's core customer, but not one that will win it any Amazon or Wal-Mart loyalists.