Wal-Mart Goes Up Against Amazon Prime With New Subscription Service — But Will It Offer What We Expect?

It seems retail giant Wal-Mart has been hit in the hip pocket by the other retail giant, Amazon. Thanks to the introduction of Amazon Prime, online shoppers can now pay a yearly subscription and get unlimited two day shipping on items they order through Amazon. Wal-Mart, however, has retaliated with a service that was supposed to be released last year but has been plagued by technical delays. They has counteracted with its downturn in online sales by now offering what is potentially an extension on its “Walmart To Go” service, which provides same day delivery on items purchased in five different U.S. regions. The new service to rival Amazon Prime will be called “Tahoe,” according to the Information.

In order to compete with Amazon Prime, which costs users $99 a year to subscribe to, Wal-Mart will offer their new service at half the cost in a rollout starting later this year.

So what will $50 a year get you at Wal-Mart compared to Amazon Prime’s $99 subscription?

  • Wal-Mart is offering free delivery within three days of ordering items online, Ravi Jariwala, Wal-Mart spokesperson, recently told Fortune. This is to try and counteract the two day free delivery service offered by Amazon Prime.
  • One million items from Wal-Mart’s 7 million online items will be available during the roll out phase of Tahoe. Shoppers will be invited to try this service and will be expanded on dependent upon customer feedback.

What you won’t get from Wal-Mart that Amazon Prime offers:

  • Free video and music streaming. This is why Tahoe is currently so much cheaper than Amazon Prime and is probably the biggest downer for customers. While free delivery for a one off yearly subscription fee is fantastic if you purchase a lot of items online from Wal-Mart, if you thought you would also be getting video and music streaming rights just like you do with Amazon Prime, guess again. While USA Today has stated Wal-Mart will alter Tahoe as per customer directive via feedback, it is uncertain if they will be able to offer video and music streaming at their current yearly rate compared to Amazon Prime.

Currently, Wal-Mart is considered one of the digital giants alongside Amazon, having recently cornered nearly $13 billion of the e-commerce market, but their sales are slowing. While a quarterly growth rate of 18 percent may seem a lot, it is a result of growth trend that has been slowing for Wal-Mart compared to the year overall.

Will you be trying Wal-Mart’s Tahoe? Or do you already use Amazon Prime? Let us know your thoughts by commenting below!

[Image credit: Walmart via the Globe and Mail]