Is $119 Amazon’s Achilles’ Heel?

EBay and Walmart are taking shots at Prime

Prime’s price tag is a target for competitors. eBay
Headshot of Lisa Lacy

In Greek mythology, Thetis, mother of the warrior Achilles, submerged her infant son in the River Styx to make him immortal, but she held him by the heel and thus Achilles’ heel was his only weakness. And, in a similar fashion, some retailers are targeting what they likely perceive (or hope) to be Amazon’s heel, which is Prime’s $119-a-year price tag.

That includes online marketplace eBay, which, like Amazon, is having a mid-July sale, touting its inclusive nature by reminding consumers no membership is required to shop. And that’s a message echoed by Walmart, which wants to make sure consumers know it offers free shipping without a membership fee, too.

A rep for eBay noted the platform has deals all year, but it has had July sales in particular for the past two to three years. When asked about timing, which coincides with Prime Day, the rep called July sales a “major summer shopping moment” and said eBay wants to “be aggressive with counter deals.”

And she’s not kidding: A week before Prime Day, eBay launched a campaign that includes more than 100 deals (although sadly not 119 precisely) for $119. As of Friday, those deals included a mountain bike, a blender, an Apple Watch and an engagement ring.

“We know [shoppers] are smart and want to make the most of their $119,” the rep said.

Advertising includes new TV spots and banner ads, which highlight what consumers can get for $119 instead of a Prime membership.

A rep for Walmart did not comment directly on Prime Day, instead saying, “We always offer great deals and savings on Right now, we’re focused on helping customers save for the summer and prepare for back-to-school.

It may just be a coincidence, but, in the lead-up to Prime Day, the homepage features “All-American Savings,” including what it calls summer’s lowest prices on home basics, electronics and more. The Walmart rep said the retailer has been talking about free two-day shipping without a membership fee since last year.

But, like Achilles, Amazon is a fierce competitor. So are these moves enough to steal some of Amazon’s thunder—and customers?

Members only

According to Emily Wengert, group vice president of user experience at digital marketing agency Huge, one of the genius aspects of Prime is it makes participants forget there’s a membership fee—in part because it’s so automatic, but also because Amazon continues to add benefits like entertainment options and faster shipping. Indeed, additional benefits include music, games, discounts at Whole Foods and access to credit cards with rewards.

Wengert’s prediction: Prime, which gives access to an omnipresent product assortment and commerce experience, won’t be upset by a simple “no fee” campaign.

“Walmart and eBay still don’t have the reputation for the exhaustive catalog that consumers perceive Amazon offers, which means Amazon holds the upper hand,” she said.

Nevertheless, Joe Migliozzi, who leads the Shop+ unit for WPP’s Mindshare in North America, said the “no membership” messaging can be competitive for customers who aren’t Prime members yet or for Prime members who only use the service for free shipping.

“The challenge is that Prime is a very sticky service for customers,” he said. “According to our own Mindshare research, when a customer becomes a Prime member, their ability to recall Prime benefits goes up to four different services—those are advantages beyond just free shipping. Prime customers are very aware of the ecosystem that they are now part of.”

Gary Nix, chief strategist at the consultancy The Brandarchist, said companies like Amazon continue to win on full experience delivered, which he described as a more contemporary way of thinking, while companies like Walmart and eBay stay with pricing, which is more old-fashioned. And, in the end, Nix said, the things each brand does well will likely remain the deciding factor: Walmart will continue to do well in markets where people are accustomed to frequenting brick and mortar, and eBay will remain the place to go for hard-to-find, discounted items.

And, even though Walmart offers free two-day shipping, it comes with an asterisk: Free shipping is only for orders of $35 or more to offset costs. Prime members don’t have that restriction. Which means it’s probably going to be difficult for Walmart to woo existing Prime members.

Instead, Migliozzi said, eBay and Walmart should focus on customers who just want to buy an item with few restrictions and free shipping.

“This may also shake a few Prime members that only wanted free shipping and saw their Prime membership increase to the new $119 amount,” he said.

@lisalacy Lisa Lacy is a senior writer at Adweek, where she focuses on retail and the growing reach of Amazon.
Publish date: July 16, 2018 © 2020 Adweek, LLC. - All Rights Reserved and NOT FOR REPRINT