Amazon Offering Free Shipping With No Purchase Minimum This Holiday Season

Amazon.com said today it would offer free shipping with no purchase minimum this holiday season for the first time. The U.S.-only promotion, effective from Nov. 5, waives the $25 minimum that customers outside Amazon's loyalty club Prime must pay for free shipping for orders that will arrive in time for the Christmas holiday. Amazon cut its order minimum for free shipping to $25 from $35 indefinitely in May 2017. In addition, Amazon also announced that its Prime members can shop with free same-day delivery on 3 million items including toys, electronics, home and fashion. Furthermore, Prime members in 60 cities can receive one-hour delivery from Whole Foods Market through Prime Now, as well as grocery pickup in 30 minutes in certain cities. Free two-day shipping will continue to be available to all Prime members in the U.S. on more than 100 million items with no minimum purchase amount.

Total Retail's Take: With this move, Amazon is targeting consumers who are not members of Prime, and hoping its wider selection will set it apart. It also heats up the competition with Walmart, Target and other rivals vying for customers’ holiday spending. Walmart and Target are particularly in Amazon's sights, as both retail behemoths have chipped away at Amazon's lead with their own offers of free two-day shipping this holiday season. While Walmart has maintained its $35 order threshold, Target has scrapped its minimum until Dec. 22. And while free shipping can apply to millions of items on Amazon, it's only available on thousands of items at Target.

Charles Dimov, vice president of marketing at OrderDynamics, added that while Amazon's holiday free shipping offer is interesting, even more interesting is the one-hour pickup offer for Prime members. "If there was ever any doubt about Amazon’s omnichannel efforts, this squashes it," Dimov says. "Amazon definitely sees the value of combining online and physical stores, and this is the proof. It's offering one-hour buy online, pick up in-store (BOPIS), which is going to compel customers this Christmas season. At OrderDynamics, we've seen about 6 percent growth in BOPIS for U.S. retail chains this past year. With Amazon starting to run in-store pickup promotions, U.S. retail needs to speed up the pace. Today, U.S. adoption of in-store pickup practices stands at only 27.5 percent."