Amazon adjusts its free shipping threshold for non-Prime customers to $35 in selected regions, aiming to promote Amazon Prime membership. Learn how this change aligns with market dynamics and Amazon's strategic focus on cost management
E-commerce giant Amazon is making adjustments to its free shipping policies by increasing the minimum purchase threshold to $35 for non-Prime customers in select regions. This move aims to encourage more customers to consider the benefits of Amazon Prime membership. The previous minimum for free shipping stood at $25.
The company clarified that this change is being tested randomly by grouping ZIP codes into regions, ensuring uniformity in the free shipping threshold within the same area. CNBC initially reported the shift, and Amazon later confirmed the news.
In response to the update, an Amazon spokesperson mentioned that the company periodically evaluates its offerings andmakes modifications based on these evaluations. While this alteration affects non-Prime customers, the spokesperson underlined that Amazon Prime members will continue to enjoy the privilege of free delivery on an extensive selection of over 300 million items. Furthermore, tens of millions of items are available for free Same-Day or One-Day Delivery exclusively for Prime members.
This strategic change is positioned to steer more customers towards Amazon Prime's comprehensive package, which includes free shipping and a multitude of additional membership perks. Amazon Prime membership currently costs $139 annually, or $15 per month.
Amazon has previously adjusted its free shipping threshold in response to market dynamics. In 2016, the minimum threshold was increased to $49 from $35. Subsequently, in 2017, Amazon reverted to a $35 minimum. This competitive landscape is a reminder of the e-commerce giant's efforts to remain agile in meeting customer expectations and market conditions.
With this move, Amazon aligns its free shipping minimum with Walmart's offering. Amazon's decision echoes a broader strategic focus on cost management, which has been evident across its business operations. The company recently underwent cost-cutting measures, including the elimination of 27,000 jobs and a temporary halt to corporate hiring. In the realm of grocery delivery, Amazon introduced delivery fees for Fresh orders below $150, thereby altering the previously available free delivery on orders exceeding $35 for Prime members. Additionally, AmazonSmile, a charitable donation program, was discontinued.
The shift in Amazon's free shipping threshold reflects the intricate balance between enhancing the customer experience and managing operational efficiency. As the e-commerce landscape evolves, Amazon's strategic decisions continue to shape the trajectory of online retail and customer engagement.