Amazon is keeping up its effort to bring more lower-income customers to its Prime membership program.
The e-retailer on Tuesday said it cut the price for a Prime subscription to $5.99 a month for people with an EBT card. These cards are used to disburse funds for food stamps and other government-assistance programs. At an annual rate, that would cost $71.88, a 27 percent reduction from the typical $99 Prime fee.
With the company gaining just about every middle- and high-income Prime customer it can, the only big way Amazon can grow Prime in the US is to bring on more lower-income households. Once customers join Prime, they tend to spend twice as much on Amazon than non-Prime customers. Nearly 75 percent of households making over $112,000 annually joined Prime, while less than 50 percent of households making $21,000 to $41,000 have, according to a study last year from Piper Jaffray.
Amazon has been trying to find ways to make its Prime fee a little easier to pay so it can convince more customers to join. The company last year— though the total cost at the end of the year was actually higher than $99.
Amazon in April also introduced a new service, which lets people without credit or debit cards instantly add money to their Amazon accounts when visiting retail locations, including CVS and Sheetz.
This new strategy doubles as a way for Amazon to fight against Walmart. The rival retailer has catered to lower-income customers for years and has been aggressively pushing into e-commerce, Amazon’s home turf.