Does cheaper always win? Walmart takes on Amazon

© June 2015 Anthony Lawrence

Apparently Walmart thinks it can compete with Amazon and plans to offer a $50 per year membership patterned after Amazon Prime. That's set to happen this year, but details are sketchy. They might include some streaming content along with free delivery, but there will be nothing even close to what Prime customers enjoy.

First up: selection. Walmart apparently sells about a million different items. Amazon has 200 million or more. Walmart competes on low priced items, while Amazon offers a range of price and quality for many items. Walmart customers generally have far less income than Amazon shoppers, so cutting the membership to $50 is likely meaningless. Additionally, Amazon Prime includes much more: Free ebooks, free music and a Netflix like streaming service that also produces its own content. Walmart can't even begin to compete with that.

Of course there is always a market for cheap. Walmart didn't need any of those perks to become the retail behemoth it is. They may capture the low end of the internet market, but I doubt they will ever be serious competition for Amazon.

Walmart to take on Amazon with a Prime-like service of its own

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