Amazon cut its order minimum for free shipping to $25 from $35 indefinitely in May 2017.
Monday’s news will pile pressure on Walmart and Target, which in recent years have chipped away at Amazon’s lead with their own offers of free two-day shipping. While Walmart has maintained its $35 order threshold this holiday, Target has scrapped its minimum until Dec. 22.
Just over half of all U.S. households have a Prime subscription, analysts estimate. Prime remains the cornerstone of Amazon’s business because shoppers buy more from the retailer once they pay $119 for the year-long membership. Perks include same-day shipping and video streaming.
Amazon is now courting those outside the club, hoping its brand and wider selection will set it apart. Free shipping can apply to hundreds of millions of items on Amazon, versus hundreds of thousands on Target. Target promises to deliver the items faster, however.
It was unclear how free delivery on small-ticket items would impact net income for Amazon, which last month touted improvements in efficiency.
According to the Seattle company’s latest annual filing, shipping costs nearly doubled from 2015 to 2017, reaching $21.7 billion.
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