Gas discounts are fueling competition between Amazon and Walmart

In today's highly competitive retail environment, Amazon has stepped up its game with the announcement that Prime membership now includes fuel savings, allowing members to save up to 10 cents per gallon at participating gas stations. This initiative from Amazon comes four years after Walmart introduced similar fuel savings in its Walmart+ loyalty program and increased discounts in 2022. As both giants vie for consumer loyalty, this latest move by Amazon represents a strategic effort to increase the value of Prime membership in the face of rising fuel prices and increased competition.

Amazon's new fuel savings initiative not only expands its Prime offering, but also taps into a growing trend: consumers are increasingly looking for ways to save on essential expenses like gas. Consider the PYMNTS Intelligence report, “Instalment Payment Plans Become an Important Part of the Shopper's Toolkit,” which shows that of the roughly 60% of consumers who used some type of installment plan in the 12 months prior to the survey, nearly 24% did so to buy gas. or 15% of all consumers.

This suggests that fuel is not just an occasional expense but a regular cost for many households. With Prime members now able to save nearly $70 a year on gas, Amazon is positioning itself as a major player in the essentials market.

Consider the PYMNTS Intelligence study, “Consumer Inflation Sentiment Report: Higher Prices Fuel a Deal-Seeking Competition,” which found that 72% of consumers who purchased a retail product in the past 30 days cited prices and discounts as key factors for choosing their shopping location.

The back and forth between Amazon and Walmart isn't just limited to fuel discounts. Here's a look at Amazon and Walmart's notable developments over the past week:

Amazon highlights

• Upgrade financial services: Q2 Holdings announced an expanded partnership with Amazon Web Services (AWS) to drive innovation for banks, credit unions and FinTech companies. This collaboration, which also includes Presidio, aims to increase the adoption of AWS technologies, including generative AI, to power Q2's digital banking products such as the Q2 Innovation Studio.
• AI-driven patient care: Amazon One Medical has launched new AI tools to improve patient care and improve the overall healthcare experience. These innovations are designed to streamline administrative tasks and allow healthcare providers to focus more on patient interactions. AI capabilities include features such as predictive analytics to identify potential health issues and automated scheduling to minimize wait times. The launch of these tools reflects Amazon One Medical's commitment to integrating technology into healthcare and making it more efficient and accessible.

Walmart highlights

• Optimized delivery services: Walmart has launched a new delivery service that combines prescription drugs with general merchandise, allowing customers to get both in a single order. The service is currently available in six states – Arkansas, Missouri, New York, Nevada, South Carolina and Wisconsin – and is expected to expand to 49 states by January 2025. The service will provide the convenience of having your medications and everyday items delivered together. The new offering aims to improve access to healthcare while allowing pharmacists to focus on high-contact services in their communities, promoting healthier lives for customers.
• Pokémon GO gift cards: Walmart is spearheading a new initiative in Pokémon GO that will allow players to send and receive gift cards directly through the app, enhancing the game's social experience. This feature allows players to purchase gift cards to various retailers, including Walmart, and share them with friends, encouraging community engagement and encouraging exploration of local businesses. By integrating gift cards into gameplay, Pokémon GO creates connections between players and provides opportunities to find new locations and rewards.