Shopping Showdown: Walmart Takes On Amazon’s ‘Prime Day’
In case it wasn’t already perfectly obvious that Walmart is gunning for Amazon, the Bentonville, Ark. giant just kicked up its e-tailing competition.
Walmart announced today that it will also offer thousands of discounts for online purchases on July 15, the same day Amazon plans on hosting its Prime Day shopping extravaganza. And in its blog post announcing the sales, Walmart took a clear swipe at Amazon’s push to have shoppers subscribe to its $99 a year Prime service.
“We’ve heard some retailers are charging $100 to get access to a sale,” the Walmart blog says. “But the idea of asking customers to pay extra in order to save money just doesn’t add up for us. We’re standing up for our customers and everyone else who sees no rhyme or reason for paying a premium to save.”
Related: Amazon’s Prime Concern—A New Online Blitz by Walmart
Walmart, the world’s largest retailer, is also offering another limited-time deal to boost e-commerce sales. Starting today, customers will receive free standard shipping with online purchases that cost a minimum of $35, instead of the usual $50. The change will be effective for at least 30 days.
In February, Walmart CEO Doug McMillon told analysts on an earnings conference call that the company would invest between $1.2 billion and $1.5 billion in e-commerce throughout the year.
Neither Walmart nor Amazon has released information about specific sale offers yet, so the early hype might prove unwarranted, but the battle is clearly on and now the claws are out.
Update: Amazon responded to Walmart’s gibe with its own accusation. “We’ve heard some retailers are charging higher prices for items in their physical stores than they do for the same items online,” Greg Greeley, vice president of Amazon Prime, wrote in an email to Bloomberg. “The idea of charging your in-store customers more than your online customers doesn’t add up for us.”
Chart of the Day: SALT in the GOP’s Wounds
The stark and growing divide between urban/suburban and rural districts was one big story in this year’s election results, with Democrats gaining seats in the House as a result of their success in suburban areas. The GOP tax law may have helped drive that trend, Yahoo Finance’s Brian Cheung notes.
The new tax law capped the amount of state and local tax deductions Americans can claim in their federal filings at $10,000. Congressional seats for nine of the top 25 districts where residents claim those SALT deductions were held by Republicans heading into Election Day. Six of the nine flipped to the Democrats in last week’s midterms.
Chart of the Day: Big Pharma's Big Profits
Ten companies, including nine pharmaceutical giants, accounted for half of the health care industry's $50 billion in worldwide profits in the third quarter of 2018, according to an analysis by Axios’s Bob Herman. Drug companies generated 23 percent of the industry’s $636 billion in revenue — and 63 percent of the total profits. “Americans spend a lot more money on hospital and physician care than prescription drugs, but pharmaceutical companies pocket a lot more than other parts of the industry,” Herman writes.
Chart of the Day: Infrastructure Spending Over 60 Years
Federal, state and local governments spent about $441 billion on infrastructure in 2017, with the money going toward highways, mass transit and rail, aviation, water transportation, water resources and water utilities. Measured as a percentage of GDP, total spending is a bit lower than it was 50 years ago. For more details, see this new report from the Congressional Budget Office.
Number of the Day: $3.3 Billion
The GOP tax cuts have provided a significant earnings boost for the big U.S. banks so far this year. Changes in the tax code “saved the nation’s six biggest banks $3.3 billion in the third quarter alone,” according to a Bloomberg report Thursday. The data is drawn from earnings reports from Bank of America, Citigroup, Goldman Sachs, JPMorgan Chase, Morgan Stanley and Wells Fargo.
Clarifying the Drop in Obamacare Premiums
We told you Thursday about the Trump administration’s announcement that average premiums for benchmark Obamacare plans will fall 1.5 percent next year, but analyst Charles Gaba says the story is a bit more complicated. According to Gaba’s calculations, average premiums for all individual health plans will rise next year by 3.1 percent.
The difference between the two figures is produced by two very different datasets. The Trump administration included only the second-lowest-cost Silver plans in 39 states in its analysis, while Gaba examined all individual plans sold in all 50 states.