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It's feeling the heat from an aggressive Walmart

By Phil Wahba
May 9, 2017

The free shipping wars are heating up again.

Amazon.com amzn has lowered its minimum order size for free-shipping to $25, the second reduction this year as its e-commerce battle with a resurgent Walmart wmt gets more intense.

Three months ago, Amazon lowered the minimum for shoppers who are not members of its Prime subscription program (which offers free two-day shipping for a $99 a year fee), meaning that now, the order minimum is about half the $49 it was in February.

The company did not officially announce the decrease, but its website currently says that online orders of at least $25 are eligible for free 5-8 days shipping on eligible items.

 

The Amazon move comes as Walmart, which has gotten more aggressive in the last year in competing with Amazon, has itself lowered free shipping minimum thresholds.

In January, Walmart nixed a Prime-like subscription service it had been testing and instead began offering free two-day shipping on orders from an assortment of 2 million items for orders of $35 or more. It was one of the first major moves by Marc Lore, the founder of Jet.com who sold his company to Wal-Mart Stores last year for $3 billion and also took the reins as Walmart’s head of e-commerce.

The new $25 minimum at Amazon is actually a return to the past: as recently as 2013, that was the amount non-Prime members had to buy for free shipping before Amazon starting raising the minimum.

The aggressive pricing vis-a-vis Walmart is likely a way for Amazon to respond to its rival’s recent pickup discount program, BestBlackFriday.com, a website that tracks online shopping trends, surmised in a blog post. Walmart’s Pickup Discount program introduced last month let shoppers get an extra discount if they pick up an online order in store, a way for the retailer to leverage its thousands of stores, but a tactic hard for Amazon to mimic.

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