Walmart’s stock rises 7% on report of Amazon Prime competitor coming this month

Walmart‘s answer to Amazon Prime will launch this month, according to a report by Vox’s Recode.

The big-box giant confirmed in February that it plans to roll out a subscription-based service called Walmart+, but it hasn’t revealed details or its strategy to attract members and stand out from competitors.

Shares rose by nearly 7% Tuesday to close at $126.95.

The membership program will cost $98 per year and include same-day delivery of groceries, fuel discounts at Walmart gas stations and other perks, according to the Recode report. The report cites multiple unnamed sources.

Walmart planned to launch Walmart+ in late March or April but delayed it because of the coronavirus pandemic, according to Recode.

Walmart declined to comment about when the service will launch.

Since Amazon launched the Prime program about 15 years ago, it’s grown to more than 150 million members. Amazon has used the subscription-based service to entice customers to shop more frequently on its site. For $119 each year, customers get fast and free shipping, access to Amazon’s streaming service and discounts at Amazon-owned grocery store Whole Foods.

Walmart has significantly grown its e-commerce business, but it’s lagged behind Amazon in market share and market cap. Amazon is valued at about $1.5 trillion, compared with Walmart, which is valued at about $360 billion as of late Tuesday.

Walmart reported online sales growth of 37% for last year, topping its own goal of 35% growth. Its online sales surged by 74% in the fiscal first quarter that ended April 30, as the coronavirus pandemic drove more customers online for groceries and other essentials.

The retailer has leaned on its grocery business to grow online. Walmart delivers to the home, but it also offers curbside service at its brick-and-mortar locations as a convenient option for customers. This spring, Walmart launched Express Delivery at many of its stores. The new service, which has a $10 fee, delivers purchases to customers’ doors in less than two hours.

Correction: According to the Recode report, the service will cost $98 per year. An earlier version of this story misstated the cost. 

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