Walmart Has A New Rewards Plan. How It Holds Up To Amazon Prime


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When two 800-pound gorillas fight over the same prized banana, the key to victory isn’t the size of the blows; it’s the delivery. And Walmart is delivering a lot of blows against Amazon.

Will they land?

Take the former Walmart rewards initiative for subscribers of Walmart+, a direct competitor to Amazon Prime. Walmart introduced its exclusive rewards program a little more than a year ago, but in recent months has made a key change: It has transformed the initiative into Walmart Cash, a perk available to anyone and, importantly, complements its cash-back Walmart Rewards Mastercard.

The maneuver is likely part of Walmart’s ongoing strategy to win market share from Amazon Prime, and its Amazon Prime Visa card. It’s a necessary strategy: 87% of Walmart+ members also belong to Amazon Prime, PYMNTS reports, at a combined annual cost of more than $230.

Chances are that after a couple of years of paying double membership fees, some of these millions of subscribers will question the expense. Some might already have: revenue from Walmart’s membership and other income in the first six months of 2023 slipped to $2.65 billion, from $2.76 billion in the same period 2022. (Walmart reported that membership in its Sam’s Club chain, meanwhile, has increased in the period.)

Walmart might see its transforming rewards program as its best bet for retention.

The Evolution Of Walmart Rewards: Year 1

Walmart launched its Rewards initiative in August 2022 as a special feature of the Walmart+ membership program. If you didn’t pay for Walmart+, which is $98 a year, you didn’t have access to rewards.

That changed over the summer when Walmart replaced its rewards program with Walmart Cash, a “promotional currency all Walmart customers can get through manufacturer offers,” according to the “Walmart Cash” FAQ page. The Cash concept aligns logically with the Walmart Rewards Mastercard (Capital One), another option for cash back that does not require Walmart+ enrollment.

This alignment ideally would encourage more spending, particularly in categories Walmart might want to punch up. While the retailer dominates in food spending, capturing 19% of the market compared with Amazon’s 2%, Walmart is dwarfed by Amazon in discretionary spending – just 6.7% vs. more than 22%, PYMNTS reports.

Comparing Walmart Rewards And Amazon Prime

These category choices are not the result of chest-beating. Consumers, like 800-pound gorillas, have their own prize bananas, typically in the forms of value, ease and preferential treatment. Here are how the Walmart Rewards and the Amazon Prime cards compare in these areas.

Both offer generous cash back to encourage spending.

Perks of the Walmart Rewards card include 1% to 5% back on purchases: 5% on orders (including grocery pickup and delivery) and on in-store purchases made through the Walmart Pay app (for the first year only; then it drops to 2%). Members also earn 2% back on fuel, travel and restaurants and 1% on other items.

The Amazon Prime Visa, by Chase, offers a similar structure: 5% back on Amazon, Amazon Fresh and Whole Foods purchases, as well as on Chase Travel; 2% back on charges made at gas stations, drug stores and for commuting (including rideshare); and 1% back on all other purchases.

How well do they travel?

The Walmart Rewards card does not charge foreign-transaction fees, and enrollment includes three forms of insurance – for rental cars, baggage delays and travel cancellations. Travel assistance and concierge services also are available.

Amazon Prime Visa offers a similar range of travel insurance, plus 5% back on travel purchases and purchase protection. It also does not charge foreign transaction fees.

Member-only credit card perks.

Walmart+ subscribers who enroll in the Walmart Rewards card have access to exclusive benefits, so they can stack their rewards. They can, for example, earn 2% to 5% additional Walmart Cash on hotels, rentals, flights and vacation packages when booking through Walmart+ members also can earn up to 10 cents per gallon on fuel, in addition to the 2% back.

The Amazon Prime card issues a $100 gift card instantly, as a welcome offer, once the card is approved. (This kind of ensures the card’s first charge will be with Amazon.) Members can redeem rewards as soon as the next day. Like the Walmart card, it does not charge an annual fee, but is only available to $139-a-year-Prime members – a distinction that has an air of exclusivity.

Retention Tips For Walmart+, Prime Or Any Membership Plan

Responses to these options will inform Walmart’s battle plan in the coming year. Amazon’s, too. Each must use its data insights to then show it means business to its respective members, especially the two-timers.

These timely, tactical approaches could help.

  • Introduce holiday-focused subscription offers now. Walmart can tempt people to enroll in its Rewards Mastercard by offering additional points on purchases made between now and November. In marketing, it can highlight the promotion alongside holiday suggestions, such as “Buy him the Apple Watch by Oct. 31 and earn double points!” This enticement could encourage earlier holiday spending, while knowing many customers will make last-minute purchases, as well.
  • See beauty for the beast it is. Nearly 40% of consumers said they are highly likely to boost online purchases of health and beauty products in the coming year, according to an August report by PYMNTS. That’s a big chunk of spending: By 2025, the beauty segment is projected to reach $180 billion, Bloomberg reports, and Amazon is projected to control a 14.5% share of it, compared with Walmart’s projected 13% share. Time to market mascara!
  • Keep layering perks into the subscription service … but the perks should be desirable. Amazon Prime members can view exclusive entertainment via Prime Video, but how many use Prime Gaming? Walmart+ members prefer its wide range of affordable food and beverages, but a “gaming” extension of food might not appeal. They might go for perks that serve practical needs, such as special deals on its Party

Keep Your Eye On The Prize

Lastly, all of retail’s giants should watch out for those little ankle-biter startups. If the 800-pound gorillas focus too much on in each other, they risk creating an opportunity for others to swoop in. It’s already happened in categories from eye glasses to razors to movies.

Yes, data insights and category spending should shape the perks retailers embed in their programs, but the prize remains a person. Don’t monkey around with them.


This article originally appeared in Forbes.

Jenn McMillen
Incendio Founder Jenn McMillen has been building and sharing expertise in the retail industry for 20+ years. Her expertise includes customer relationship management, shopper experience, retail marketing, loyalty programs and data analytics. She's a retail contributor for Forbes.


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