Amazon is fighting Walmart for business by making its Prime membership program more affordable for customers on government assistance programs, including food stamps. Walmart has long been known as one of the largest chain of discount department stores in the U.S., but Amazon is also determined now to go after the same low-income customers.
According to Amazon, about 20 percent of the United States’ population are people who obtain government assistance with food stamps. By dropping their Prime membership fee to $5.99 a month, low-income customers get access to unlimited two-day shipping at a membership cost far less than for other customers.
Cashing in on low income customers
Amazon’s new programs such as AmazonFresh are aimed at low-income customers. About 44 million recipients of Supplemental Nutrition Assistance Program (also known as SNAP or food stamps) represent a huge potential customer base for Amazon. The company has expanded its Prime membership program to more than a dozen countries internationally. They also continue to add more perks to their programs to make it easier for low-income customers to shop.
Soon to accept food stamps online
When the food stamp program began back in the 1930’s, they were actual physical coupons that had to be turned in with every purchase. But today recipients are given an electronic debit card. This means that after getting approval from the U.S. Dept of Agriculture, the “food stamps” can easily be used for online purchases.
Soon, Amazon may be able to accept online food stamp grocery purchases, thanks to a U.S. Department of Agriculture two-year pilot program that is planning to launch. But, Walmart is also included in the pilot program.
This should help in those “food deserts” – parts of the country, usually impoverished areas, lacking of fresh fruit, vegetables, and other healthful whole foods. This is largely due to a lack of grocery stores, farmers’ markets, and healthy food providers.
This has become a big problem because while food deserts are often short on whole food providers, especially fresh fruits and vegetables, instead, they are heavy on local quickie marts that provide a wealth of processed, sugar, and fat laden foods that are known contributors to our nation’s obesity epidemic. The food desert problem has in fact become such an issue that the USDA has outlined a map of our nation’s food deserts.
Amazon.com Inc.’s acquisition of Whole Foods Market Inc. should help speed along the adoption of online grocery, an area that has been slow to catch on with consumers, experts say.
For more details about AmazonFresh, visit www.amazon.com/AmazonFresh/