Walmart has today announced that they are adding to the benefits of their Walmart+ membership and importantly doing so without increasing the price of the membership. In a move that is surely aimed at competing with Amazon Prime’s offering, Walmart has announced a partnership with streaming service Paramount+ which will bring their essential subscription into Walmart+ at no extra cost.
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Walmart+ membership is currently priced at $98 a year or $12.95 a month and from September will now include the Paramount+ Essential Plan subscription which has an added $59 value.
“Paramount has enjoyed a close relationship with Walmart for years, and Walmart customers connect with Paramount’s beloved brands, content, and characters every day through a range of consumer products available throughout Walmart stores,” said Jeff Shultz, Chief Strategy Officer, and Chief Business Development Officer, Paramount Streaming.
“Now, pairing Walmart’s expansive reach across the country with Paramount+’s broad and popular content that offers something for everyone is a unique opportunity to expand our partnership. Together we will bring Walmart+ members the full breadth of Paramount+ programming.”
Comparing this with Amazon Prime which this year announced a significant price increase in the US market from $119 to $139 a year or from $12.99 to $14.99 a month. At the time Amazon stated the price increases were due to increased operational costs as well as increased value in their Prime video programming.
This is a great move from Walmart at a time when their largest competitor is increasing the cost of their subscription service, Walmart+ is adding to the subscription benefits without adjusting the price. With Walmarts impressive logistics network too, and maybe sooner rather than later more widespread drone deliveries, they could be challenging Amazon for dominance in the subscription market.
Walmart+ eCommerce Sales up 12% in Q2
Things are certainly looking good for Walmart as this week they also announced their Q2 earnings which was the foundation for their Paramount+ announcement.
The key highlights of the announcement are:
- Total revenue was $152.9 billion, up 8.4%, or 9.1% in constant currency
- Walmart U.S. comp sales grew 6.5% and 11.7% on a two-year stack.
- eCommerce growth was 12% and 18% on a two-year stack.
- Continued to gain market share in grocery.
“We’re pleased to see more customers choosing Walmart during this inflationary period, and we’re working hard to support them as they prioritize their spending. The actions we’ve taken to improve inventory levels in the U.S., along with a heavier mix of sales in grocery put pressure on profit margin for Q2 and our outlook for the year.
“We made good progress throughout the quarter operationally to improve costs in our supply chain, and that work is ongoing. We continue to build on our strategy to expand our digital businesses, including the continued strength we see in our international markets.” Doug McMillon President and CEO, Walmart
Off the back of this news, Walmart shares rose by close to 8% most likely in response that Walmart had stuck by its initial end-of-year targets and was happy they were on the right track to hit the goals.
You can see the full Q2 earnings announcement from Walmart here.
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