As Amazon continues to introduce new pricing models for its Prime service, the eCommerce retailer is now focusing its attention on Prime Pantry. While customers used to pay for Prime Pantry deliveries on a per-box basis, the company is now moving toward a subscription model, CNBC reported.
Currently, Amazon charges $6 per box for Prime Pantry. Going forward, it will charge $5 for a monthly subscription. To ease the transition, the eCommerce retailer will roll out the subscription model slowly, allowing shoppers to opt out of the subscription model and instead pay $8 on a per-box basis.
Through Prime Pantry, Amazon offers non-perishable food items along with household goods, such as beauty and cleaning supplies. The service is one of many features the company promotes as fast and convenient.
The news follows Amazon’s introduction of discounted Prime pricing to more people receiving government benefits. The company will now offer its Prime membership for $5.99 a month instead of $12.99 a month (up from $10.99 a month) or $99 a year — to those on Medicaid for up to four years, The Wall Street Journal reported.
While more than half of U.S. households with internet have Prime, the program is particularly popular with wealthier consumers. And even as shopping picks up online, many lower-income consumers still shop at traditional brick-and-mortar retail stores such as Dollar General, since they can pay with a SNAP (Supplemental Nutrition Assistance Program) card or cash.
By offering discounted pricing on its memberships, Amazon is also able to attract viewers to its digital content. “They come for shipping,” Aaron Perrine, who leads the program, told the WSJ. “They stay for digital.” Amazon, after all, offers streaming of music and videos.
Last year, Amazon announced a deal on Prime — $5.99 a month instead of $10.99 a month — to U.S. residents receiving government assistance. Shoppers with an Electronic Benefits Transfer card, which is used for benefits like the Women, Infants and Children Nutrition Program, are eligible for the lower price. These customers will then have to re-qualify every year for up to four years.