Walmart delays launch of its Amazon Prime rival service

Walmart is delaying the launch of its Amazon Prime rival, as the coronavirus pandemic pushes back the company's plans. Yahoo Finance's Dan Howley joins Kristin Myers to discuss.

Video Transcript

KRISTIN MYERS: And Amazon's prime competitor, Walmart Plus, they have been delayed yet again. Walmart, right now, down almost 2%.

So for more on this, we're joined now by our favorite Yahoo Finance texpert, Dan Howley. Hey, Dan.

DAN HOWLEY: Hey, Kristin. Yes, this is supposed to be a direct competitor to Amazon Prime, but there have been issues with the launch of this service. Now, it was originally supposed to go live in April. But, obviously, that had been derailed because of the coronavirus pandemic. You don't want to launch a subscription service like that around that time. And then it was supposed to launch in July, but, according to Recode, that has been pushed to sometime in the future.

Now, the issue that Amazon is facing here is how it can best compete with a loyalty program like Prime. And so, essentially, what this is supposed to do is allow you to get access to a number of benefits through Walmart, including same-day shipping in certain instances, and even discounts on gas at Walmart Supercenters that have gas stations attached. And I think that's something that's going to really appeal to a number of people in areas where Walmarts really serve as the center of local towns.

I think the other issue is, they need to get a video platform off the ground. That, they are apparently doing as well.

But, you know, for Walmart, it really comes down to how can they play in the same space as Amazon when Amazon dominates e-commerce so much, especially here in the US? You know, during the pandemic, Amazon managed to be one of the go-to places for a lot of consumers because it offers that shopping opportunity where you can get, in instances, two-day delivery. During the height of the pandemic though, obviously, that was extended to a certain degree. But, really, it was a go-to for many people, and I think that is going to help them going forward, as people see the loyalty kind of turn towards something like an Amazon.

For Walmart, going forward, they're really going to need to be able to compete with Prime. And once they get this service off the ground, they're going to have to market it pretty, pretty intensely.