Amazon targets low income group; takes out Walmart

The clash between retail giants is increasing every day. And now Amazon has vouched a new plan to attract the low-income group with Amazon Prime for those who receive government assistance. They now have valid electronic benefits transfer cards which are used for programs like Supplemental Nutrition Assistance Program (SNAP) or food stamps, as they are popularly known. People need to pay $5.99 per month for a year along with a free one month trial.

“We designed this membership options for customers receiving government assistance to make our everyday selection and savings more accessible, including the many conveniences and entertainment benefits of Prime”, said the vice president of Amazon Prime, Greg Greeley, in a statement.

Usually, Prime members would need to pay $99 a year or an option of paying $10.99 a month. Many note that this is a direct attack on Amazon’s rival retail- Walmart. Reuters puts it as ‘direct challenge’ towards Walmart. They believe that targeting the low income Americans is a good business strategy. Amazon will be profiting from both frequent prime users and discounted prime users as well.

On the other hand, Walmart is working hard to keep its customers, even as online shopping is soaring high. Walmart acquired Jet.com for $3.3 billion for its online strategy, where it’s scrapping a $50 charge for two-days, no-cost shipping membership program in favor of offering free shipping for orders above $35. While Amazon offers free shipping for orders $25. The cut-throat competition is clearly evident!

And now with Amazon’s new mantra, positive public relations and goodwill from the low income consumers are additional benefits that Amazon will receive from discounted Prime. For the company that boasts of top-level customer service ratings in the retail world, it is another feather in its cap.