Walmart’s answer to Amazon Prime launches Sept. 15 as Walmart+

Walmart said it will on Sept. 15 launch its much-anticipated Walmart+ service, a membership program that includes in-store and online discounts and fuel savings of 5-cents a gallon at Walmart stations or those owned by Murphy USA.

Walmart+ will give members unlimited free delivery from stores, fuel discounts and access to tools like Scan & Go to make shopping faster and easier. The cost is $98 annually or $12.95 per month and includes a 15-day free trial period. Walmart said it will leverage its wide-ranging strengths to provide additional benefits to members in a variety of services and offerings.

The $98 membership compares to Amazon Prime’s cost of $112. The Prime membership also includes video streaming but provides no fuel discount. Consumers can sign up for membership on the Walmart app.

“We are a company committed to meeting our customers’ needs,” said Janey Whiteside, chief customer officer at Walmart. “Customers know they can trust us and depend on us, and we’ve designed this program as the ultimate life hack for them. Walmart+ will bring together a comprehensive set of benefits where we see the greatest needs from our customers and where our scale can bring solutions at an unprecedented value.”

FREE DELIVERY, FUEL DISCOUNT
Walmart said the service covers in-store prices as fast as same-day on more than 160,000 items from tech and toys to household essentials and groceries. This new program replaces Delivery Unlimited which the retail giant launched last year. Delivery Unlimited subscribers will automatically become Walmart+ members on Sept. 15.

Walmart is already king of the U.S. grocery business in terms of sales. Kroger is second, but does not have the expansive footprint of Walmart. Neither does H-E-B or Publix, but each command sizable shares in the markets they serve. They also already offer some form of grocery delivery and curbside pickup, which analysts agree is crucial for long-term survival.

Walmart’s unlimited grocery delivery has been a success, according to Whiteside in the midst of COVID-19 and another way Walmart was able to leverage its unique assets to save time and money for consumers.

Walmart said members can save up to 5 cents a gallon at nearly 2,000 Walmart, Murphy USA and Murphy Express fuel stations. There are plans to add Sam’s Club fuel stations in the next few months. Murphy USA said it has nearly 1,500 fuel stations IN 25 states that will participate in the Walmart+ program. The 5-cent discount will be given instantly at the fuel dispenser.

SCAN & GO
Walmart said members will also be able unlock the Scan & Go feature in the mobile app to activate this service again. Customers will be able to scan their items as they shop and pay using Walmart Pay for a quicker, touch-free payment.

Walmart tested Scan & Go in select markets like Rogers, a few years ago but shelved the service because of shoplifting and other issues with performance. Sam’s Club has offered Scan & Go to its members for several years and reports stellar results and favorable member feedback.

Stephens Inc. analyst Ben Bienvenu said Walmart+ should help to drive increased customer loyalty and provide the retailer with incremental cash flow from membership fees to support its pursuit of accelerated delivery schedules.

“We continue to think Walmart is well-positioned for the long-term, and we see Walmart+ as another arrow in the company’s quiver as management works to gain increased mindshare with its consumers. We reiterate our ‘overweight’ rating and $160 price target,” Bienvenu said.

Walmart shares (NYSE: WMT) rallied with the news on Tuesday trading at up more than 6% to $147.40 in the afternoon session. Walmart shares are up 24% year-to-date and in the past 52 weeks have traded between $148.87 and $102.