In the face of growing online delivery competition, Amazon has begun offering free shipping on small items like makeup and mobile phone accessories, without requiring a minimum order or a subscription to Amazon Prime membership program.
Thousands of products weighing less than 8 ounces will ship for free through the e-commerce company's new "Small and Light" program, an Amazon spokesman said Tuesday. The items will typically be delivered in three to eight business days, as opposed to the free two-day shipping offered to Prime subscribers. Free two-day delivery for non-Prime subscribers usually requires a $35 minimum order.
"Customers love that even if it's a $5 item, shipping is free for everybody, Prime member or not," Neil Ackerman, a senior manager at Amazon, said in a statement. "Customers love it and sellers love it."
In addition to helping attract more occasional shoppers, the new offering could help Amazon expand its tens of millions of Prime customers -- who pay $99 a year for free shipping, a streaming video library and cloud storage -- during a time when the e-commerce giant is staring down plenty of new competition.
Walmart will test out a $50-a-year unlimited shipping service, eBay plans to pilot a buyer loyalty program in Germany, and startup Jet.com, which hasn't officially launched, is looking to offer a member-focused online marketplace. Also, Google has been developing its Express shipping service and Uber is dabbling in deliveries. Startups including Instacart and Postmates are also getting in the mix.
Amazon Prime has proved lucrative for the online retailer. At the end of 2014, Amazon Prime had 40 million US members, up from an estimated 29 million at the end of the third quarter, data from Consumer Intelligence Research Partners shows. CIRP estimates that the average Amazon Prime customer spends $1,500 per year on the e-commerce site, compared with $625 for nonmembers.
In a bid to stave off the growing tide of competing delivery programs, Amazon has been busy beefing up its delivery offers. Last week, Amazon unveiled a service that offers free, same-day deliveries to Prime subscribers of more than 1 million items. Orders must total more than $35 to qualify and be placed before noon, otherwise it will arrive the next day.
Amazon is also trying to develop delivery drones, but so far has been slowed as government officials weigh how to regulate such a service.