Introduction

Walmart is reducing the cost of its subscription service, Walmart+, for Americans who receive food stamps and other types of government assistance. This move aims to grow the program and cater to price-sensitive shoppers.

Lower Price for Low-Income Households

Starting July 20, customers eligible for qualifying government aid can pay $49 a year or $6.47 monthly for Walmart+. This is a significant reduction compared to the regular price of $98 per year or $12.95 per month.

Aim to Capture and Retain Shoppers

By offering a discounted price, Walmart hopes to attract and retain shoppers who may be more likely to cancel services with recurring fees or turn to other retailers. Approximately a quarter of Walmart+ members currently receive government assistance, but specific subscriber numbers have not been disclosed.

Impact of Inflation on Grocery Bills

Walmart’s CEO, Doug McMillon, has acknowledged that customers are burdened by higher grocery bills due to inflation, particularly for food. This has created uncertainty for the company in the second half of the year.

Increasing Accessibility for Low-Income Shoppers

With over 41 million Americans receiving funding for food through SNAP, Walmart’s discounted price for Walmart+ could make it more accessible to a larger number of shoppers who qualify for government assistance.

Competition with Amazon Prime

Walmart+ was launched in 2020 as a way to attract shoppers and increase their spending on Walmart’s website and in stores. It is similar to Amazon Prime and membership-based warehouses like Costco and Sam’s Club.

Benefits of Walmart+

Members of Walmart+ enjoy free shipping, fuel discounts, access to streaming service Paramount+, and unlimited deliveries of online orders over $35. The program has gained some traction, but Walmart is seeking ways to increase its membership count.

Comparison with Amazon Prime

While estimates vary, Walmart+ membership count is significantly lower than Amazon Prime’s estimated 170 million memberships in the U.S. Amazon also offers a discounted fee for low-income households that qualify for government assistance.

SNAP Acceptance and Other Benefits

Walmart now accepts SNAP online in all 50 states, making it easier for families receiving food aid to shop online. This aligns with Amazon’s acceptance of SNAP in all states except Alaska.

Expanding Subscriber Base for Walmart+

Expanding the subscriber base for Walmart+ not only brings in revenue but also provides valuable customer insights that can support Walmart’s analytics tool, Walmart Luminate, and its advertising business, Walmart Connect.