Facing new competition from Walmart’s free shipping program, Amazon has reverted to a minimum order of $35 for people who aren’t members of its Prime subscription program to qualify for free shipping.
The move comes a year after Amazon increased the threshold to $49 per order, and a few weeks after Walmart introduced its new $35 minimum order policy for free shipping. Amazon made the change quietly, updating a support page with the new number, as first spotted by The Verge.
The support page now says, “You receive free shipping if your order includes at least $35 of eligible items or $25 of books (in which case all other eligible items in the order also ship free). Any item with ‘FREE Shipping’ messaging on the product detail page, that is fulfilled and shipped by Amazon, is eligible and contributes to your free shipping order minimum.”
Free shipping is a tricky issue for Amazon, fueling sales but also requiring the company to absorb significant costs. Amazon’s net loss on shipping — the difference between what Amazon charges customers for shipping and what the company spends to get those items to customers — reached an all-time high of nearly $7.2 billion in 2016, according to GeekWire’s analysis of Amazon’s financial results.
The trend is toward more and more free shipping. Amazon CEO Jeff Bezos noted in the company’s year-end earnings release that more than 50 million items are now eligible for free two-day shipping, an increase of 73 percent from the previous year. Much of that increase is driven by the company’s $99/year Prime membership program, which has no minimum for free shipping on eligible items.