Wal-Mart takes on Amazon in head-to-head fight

Both companies offer head-to-head discounts for online services

Wal-Mart will begin its  sale on July 15th, the same day as Amazon’s much-publicised promotion.

Wal-Mart will begin its sale on July 15th, the same day as Amazon’s much-publicised promotion.

 

Walmart is cutting prices on thousands of products this week in a counterattack to Prime Day, an event Amazon.com is using to promote its subscription service.

Walmart will begin the sale on July 15th, the same day as Amazon’s much-publicised promotion.

During Prime Day, Amazon will offer special discounts to members of its service, which costs $99 a year. The move marks an escalating battle between Wal-Mart’s e- commerce site and Amazon, the world’s largest online retailer.

Wal-Mart also has been developing its own competitor to Prime that will cost $50 a year, half the cost. But it won’t have the same speed of delivery as Prime or some of the other perks, such as Amazon’s streaming video and music services.

Wal-Mart’s promotion this week is separate from that push, and the deals are available to all customers.

Fernando Madeira, president of Walmart.com, took a dig at Amazon in a blog post on Monday, saying that Wal-Mart’s discounts won’t just be for people who pay for a membership. “We’ve heard some retailers are charging $100 to get access to a sale,” Mr Madeira said. “But the idea of asking customers to pay extra in order to save money just doesn’t add up for us.”

As part of the effort, Wal-Mart also is lowering its minimum purchase for free shipping to $35 from $50. Wal-Mart, the world’s biggest retail chain, is betting that online sales can help pull it out of a broader slump.

The company cut its sales forecast in February, and higher spending on wages and other investments have raised concerns for investors. Wal-Mart has been trying for years to get a bigger share of online retail sales. It opened sleek offices in Silicon Valley, hired hundreds of programmers and acquired tech companies. Wal- Mart’s online sales increased 17 per cent in the first quarter.