Walmart Inc. (NYSE:WMT) will be launching its long-speculated Walmart+ subscription service nationwide on Sept. 15, the company announced Monday.
What Happened: Walmart was rumored to be rolling out a subscription plan earlier this year but the idea was put on hold.
The new program will cost $98 a year, or $12.95 a month, reported CNBC. Benefits of the program include free delivery, gas discounts, and the option to use the company's “Scan & Go” app that allows customers to skip the traditional checkout line. Customers will need to have a minimum order of $35 to receive free delivery.
Walmart has tried a subscription model in the past. In 2015, it rolled out ShippingPass — only to cut the program two years later.
“We’ve designed this program as the ultimate life hack for them.” Walmart’s chief customer officer Janey Whiteside said, when speaking about their customer focus, according to the Washington Post.
Why It’s Important: Walmart is the nation's largest retailer with 3,569 supercenters nationwide.
In June, Morgan Stanley analyst Simeon Gutman said Walmart, with its assets, size and scale, seemed to be the second logical winner, after Amazon.com Inc. (NASDAQ:AMZN), when it comes to subscription models.
“A subscription model could change the conversation for WMT, allowing it to invest more freely into the business and earning a higher multiple by doing so,” Gutman said.
In August, Tab Analytics reported that the Arkansas-based retailer outsold Amazon in online grocery shopping.
“We’re not launching Walmart+ with the intent to compete with anything else,” Whiteside said in a call to reporters Monday, according to CNBC.
According to Rakuten Intelligence data, Walmart’s e-commerce sales made up 5% of overall United States online sales during the month of June, the Washington Post noted earlier.
Price Action: Walmart shares traded 0.25% higher at $139.20 in the after-hours session Monday.
Photo courtesy: Jared C. Benedict via Wikimedia