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Walmart is fixing its biggest weakness - and it's a new threat to Amazon Prime

May 12, 2016, 19:27 IST

A worker at a warehouse for Amazon, one of the companies that has helped changed how people think about political priorities.Getty Images/Matt Cardy

Walmart is fixing the biggest weakness with its online business.

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The company is testing a shorter free shipping window for members of its subscription shipping service, called ShippingPass.

The shipping window was formerly three days, and it will now be two days.

The change will make ShippingPass a more formidable rival to Amazon Prime, which also offers two-day shipping.

ShippingPass, which is still in test phase, costs $49 annually. That's half the cost of Amazon Prime.

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Like Amazon Prime, ShippingPass gives subscribers access to more than 1 million products online that they can get delivered to their doors within a couple days.

There's no minimum order requirements to qualify for the free two-day shipping. The membership also comes with free returns online and in stores.

The shipping changes are Walmart's latest bid to take on rival Amazon.

Walmart

The retailer has been investing billions into its ecommerce business in recent years, but Walmart's online sales are still a tiny fraction of the size of Amazon's.

Walmart's online sales were $13.7 billion in fiscal 2015. By comparison, Amazon's online and electronic device sales in 2015 were $99.1 billion.

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Walmart has been much slower than Amazon to offer fast and free shipping for online orders, however.

Without ShippingPass, Walmart customers have the option to choose between "rush" one-day shipping, which can cost at least $14 per item, or "expedited," "standard," and "value,"options, which take between two and seven days and cost roughly $5 to $8. Walmart also offers free pickup at stores.

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