Walmart is introducing another perk designed to sweeten the deal for its Walmart+ membership program — the retailer’s answer to Amazon Prime, which today offers a combination of free shipping, fuel discounts, contact-free checkout, exclusive deals, free streaming, and more. On Wednesday, the Walmart+ subscription will gain a new cashback in the form of digital rewards that can be used on future Walmart purchases, the retailer told TechCrunch.
Walmart+ subscribers will be able to browse the Walmart app for offers across a range of bestselling items across groceries, household goods, pet care, and other categories. They can then “clip” these offers like digital coupons to be used on upcoming purchases. After buying a rewarded item, Walmart+ members will earn cashback in the form of digital “Walmart Rewards” that are saved to their Walmart Wallet in the app.
Those rewards can accumulate over time, allowing customers to apply their balance to a future Walmart purchase for further savings.
The system has some similarities with Target’s discount program, Target Circle, which presents various offers and digital gift cards to loyal customers who shop for specific products which can be redeemed at checkout. But in Walmart’s case, the new rewards program is limited to its Walmart+ subscribers instead of being available to all shoppers. It’s also not an entirely in-house effort.
Instead, the feature is the first product to emerge as a result of Walmart’s partnership with the cash back rewards platform Ibotta, announced last year. The retailer had said at the time the agreement would later allow customers to redeem rebates and offers to save on purchases along with other benefits.
The addition of Walmart Rewards is meant to serve as another perk designed to encourage consumers to sign up for Walmart’s membership program instead of Amazon Prime.
Of note, it also arrives at a time when Amazon Prime is in the Federal Trade Commission’s crosshairs. The FTC is investigating whether or not Amazon used interface designs that manipulated customers into signing up for the membership program and whether it made it difficult to cancel. Amazon customers, meanwhile, are also newly debating the value of Prime after price hikes this year in markets like the U.S. and Europe, amid inflation and other economic issues that have U.S. households reconsidering their budgets for subscription services.
At $139 per year, Amazon Prime is a bit pricier than the $98 per year Walmart+ — and if used primarily for free shipping benefits or free grocery delivery, some customers may opt for the latter to save the extra cash.
Launched in September 2020, Walmart+ combines a free shipping perk with other benefits that appeal to a more cost-conscious and budget-minded shopper, like gas discounts. It also offers six months of free streaming music with Spotify and last week unveiled a new partnership with Paramount, allowing Walmart+ members to gain access to the streaming service and home to shows like “1883” and “Star Trek: Strange New Worlds,” without raising the membership fee.
Still, Walmart+ membership has slowed in recent months, requiring it to expand the subscription perks in an effort to reach more potential customers. An August 2022 report by Consumer Intelligence Research Partners (CIRP) found Walmart+ subscriptions had plateaued, estimating the program had some 11 million members in the U.S. But Morgan Stanley had pegged the number higher — at 16 million members.
Prime, for comparison, has over 200 million members worldwide but doesn’t provide figures on a per-country basis.