Amazon Is Discounting Its 'Prime' Subscription For SNAP Recipients

Bryan Michalek | June 8, 2017
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Earlier this week Amazon announced a brand new version of their Prime service geared toward low-income customers or people on government assistance. The move, according to analysts, is aimed at taking on Walmart’s lower income shoppers.

On Tuesday, Amazon dropped a press release explaining its cutting-edge new Prime service, now offering a discount for anyone living off of government benefits.

The Prime service, which offers benefits like free two-day shipping and online music and video streaming, typically costs users $10.99 monthly or $99 for a year-long subscription.

But under Amazon's new policy, anyone with a state-issued EBT debit card will have access for a discounted $5.99 monthly fee. Amazon spokeswoman Julie Law said the discount was enacted to make “savings more accessible” to everyone, as reported by FOX5 San Diego. However, the policy doesn't discount individual purchases or other memberships costs on the site.

Law also added that the Amazon delivery service would provide access to products that may be tough to get a hold of without reliable access to shipping services.

Amazing has recently sought to change its reputation as a luxury shopping service. With more membership aimed at lower income folks, the site can now brandish a new reputation as an essential services retailer, while still maintaining its current level of service to higher income earners. According to a Piper Jaffray study, it was found that Prime’s membership growth is growing most rapidly among households with more than $112,000 a year in annual income and that more than 70 percent of higher-earning households have a Prime subscription.

By attracting more low-income customers, Amazon is also poised to take on the retail dominance of brick-and-mortar stores like Walmart that pander to lower-income buyers. Discounts from Amazon Essentials services -- like 20 percent off on diapers, for example -- combined with the accessibility that comes with a delivery service may be the edge Amazon needs to beat out other retailers.

The advantage goes even further when you look at the number of retailers working with SNAP (Supplemental Nutrition Assistance Program), which was announced earlier this year. SNAP is directly used to pay for food products, a department that Amazon is already gaining hold of with its fresh grocery delivery service that will be running trials in 2018. In 2016 alone, the total spending for all the USDA’s food and nutrition programs amounted to around $101.9 billion, with SNAP making up around 70.8 billion, as reported by Techcrunch.

As of now, these are all plans that have yet to be implemented, but you can be sure Amazon is working on a way to capitalize on this market. As the retailer continues to gain popularity, it’s not a matter of "if," but "when" Amazon becomes the main E-commerce giant on the web.