Amazon and Walmart, the two retail titans, are constantly pushing the envelope to win over customers in the increasingly competitive online shopping market. Their strategies often revolve around enhancing membership programs like Amazon Prime and Walmart+. By adding new features and benefits, they strive not only to attract new subscribers but also to deepen the loyalty of their existing members. This article dives into the innovative tactics both companies are employing to elevate their membership offerings and secure consumer loyalty.
Amazon Broadens Prime Membership Benefits
Amazon Prime has long been the gold standard when it comes to membership programs. The company is now expanding its horizons by rolling out the “Buy with Prime” feature, which extends Prime benefits like free shipping to external merchants’ platforms. This initiative aims to create a more integrated eCommerce ecosystem, allowing Prime members to enjoy Amazon-esque conveniences across a wider range of online stores.
Notably, Amazon recently added the option to pay via PayPal within the “Buy with Prime” program. This move highlights Amazon’s commitment to providing flexible payment options, aiming to make the shopping experience as seamless as possible. By integrating PayPal, Amazon is catering to a broader audience, potentially converting more users into loyal Prime members.
The social commerce angle is another significant facet of Amazon’s strategy. “Buy with Prime” now enables merchants to promote their participation in this program through real-time delivery estimates on TikTok ads. This tactic taps into the vast, influential user base of TikTok, targeting younger audiences who are often more engaged on social media platforms.
The Strength of Buy with Prime
According to Peter Larsen, Vice President of Buy with Prime and Amazon Multi-Channel Fulfillment, the initiative has shown impressive growth. Larsen reported a 45% year-over-year increase in “Buy with Prime” orders and a more than 50% rise in Prime customers utilizing this service.
During Amazon Prime Day, the impact of these additions was particularly evident. Order volumes saw a 300% surge compared to the previous month, illustrating the significant draw of these new features. The numbers speak for themselves; these enhancements are not merely cosmetic but substantially contribute to Amazon’s bottom line by driving engagement and loyalty.
The strategy reflects Amazon’s proactive approach to evolving alongside consumer behavior and market trends. By expanding the usability and appeal of Prime, Amazon ensures it remains an indispensable part of its members’ shopping experience.
Walmart Targets Bargain Hunters
While Amazon focuses on broadening Prime’s footprint, Walmart is courting deal-seeking consumers with exclusive benefits for its Walmart+ program. A notable strategy is offering early access to holiday shopping sales events exclusively for paid Walmart+ members. This move ensures that members get the first pick of coveted discounts, reinforcing their commitment to Walmart+.
Seth Dallaire, Walmart U.S. Executive Vice President and Chief Revenue Officer, emphasized that this is just one of many perks being added based on customer feedback. The early access strategy aims to build a sense of exclusivity and urgency, making the Walmart+ subscription more attractive.
Walmart is also expanding its membership’s value proposition through partnerships. Collaborations with Paramount+ for streaming perks and Burger King for food offerings diversify the benefits available to Walmart+ subscribers. These varied incentives aim to create a more holistic and appealing value package, setting Walmart+ apart from Amazon Prime and other competitors.
Quantifying Membership Growth
Despite Walmart’s efforts, Amazon Prime continues to dominate the subscription market. According to PYMNTS Intelligence, Amazon Prime boasts a more extensive membership base. A survey conducted in July revealed that over two-thirds of U.S. consumers are Prime members, up from 65% the previous year. Meanwhile, Walmart+ membership rose to 30%, an increase from 23% last year.
These figures indicate that while Walmart+ is growing, Amazon Prime still commands a substantial lead. Nonetheless, Walmart’s strategic moves are gradually closing the gap, reflecting the effectiveness of their customer-centric enhancements.
Evolving to Meet Customer Demands
Both retail giants underscore the importance of responding to customer feedback in developing their loyalty programs. Amazon’s efforts in providing flexible payment options and leveraging social media for greater reach exemplify a modern approach to customer engagement. By continually updating their offering based on user preferences and behaviors, Amazon ensures its Prime service remains relevant and enticing.
Walmart’s strategy similarly focuses on diversifying membership perks and creating exclusive shopping opportunities. The early access to deals and partnership-based benefits illustrate Walmart’s commitment to delivering value that resonates with its audience, particularly those seeking savings.
By understanding and evolving with market demands, both Amazon and Walmart display strategic thinking in boosting customer loyalty and engagement. Their ongoing efforts to innovate and expand membership benefits signal an unwavering commitment to remaining at the forefront of the retail market.
