Published: Wed, February 01, 2017
Economy | By Melissa Porter

Walmart launches free two-day shipping service with no membership fee

The service, called ShippingPass, was introduced nearly two years ago and offered free two-day shipping for customers that paid the $49 annual membership fee.

Starting today, Walmart customers can get free two-day shipping with a minimum purchase of $35 from today.

All Walmart customers will qualify for the free two-day shipping.

"We don't think it's necessary to charge for a membership", Marc Lore, Wal-Mart's president and CEO of USA e-commerce, said Monday.

"I couldn't be more excited", says Walmart U.S. eCommerce president and CEO, Marc Lore. In its place, the big box retailer plans to offer free-two day shipping on millions of products with a lower minimum purchase price. Earlier this month, Lore shuffled Wal-Mart's e-commerce decks.

The decision to scrap the membership fee is Lore's boldest move yet to challenge Amazon since he took charge of Wal-Mart's struggling online business. The company will offer refunds for ShippingPass membership fees.

Whether speedy, free shipping will prove enticing enough to woo new shoppers remains to be seen. That's down from its previous spending threshold of $50, and its prior delivery window of three to five days.

Prime has more than 50 million members in the US, according to Cowen and Co.

The free two-day shipping at Walmart is available on 2 million items.

And that will only accelerate as Amazon's Prime Now offering expands, making it possible to get stuff within an hour or two of ordering. The range of items will include "everyday essentials", like household products, baby needs, pet supplies, cleaning supplies, beauty products, electronics, toys and grocery items that don't need refrigeration.

Walmart's free two-day service is part admission that it got too late to the subscription game, and a move to gain a stronger following with the estimated 56 percent USA households that don't subscribe to Prime.

Amazon Prime's value isn't in its retail quality-of-life service, it's in the way the company has deeply integrated Prime membership across its ecosystem.

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