Amazon has announced it’s testing a subscription model for unlimited grocery delivery for Prime members. For an additional monthly charge of $9.99, Prime members in three cities can get unlimited delivery on Amazon Fresh and Whole Foods orders over $35. Those who opt-in will also receive unlimited 30-minute pick-up on orders of any size.
It’s the latest in a series of changes that Amazon has made to a division that competes with the likes of Walmart, Postmates, Instacart, and the major grocery chains themselves. “We’re always experimenting with features to make shopping easier, faster, and more affordable, and we look forward to hearing how members who take advantage of this offer respond,” said Tony Hoggett, Amazon’s senior vice president of worldwide grocery stores, in a statement on Thursday.
Right now, the pilot is restricted to three U.S. cities: Denver, CO, Sacramento, CA, and Columbus, OH. The $9.99 subscription fee for grocery delivery is an additional charge on top of a standard Amazon Prime subscription — which costs $14.99 per month (or $139 a year).
Amazon’s pricing scheme for groceries was once pretty simple: Prime members would get free delivery on all orders of Amazon Fresh and Whole Foods over $35. In 2021, Amazon tacked on a $9.99 delivery charge for all Whole Foods orders — a decision that led to a lawsuit by customers (A U.S. district court judge on Thursday dismissed all eleven of the plaintiff’s claims, but they will have a chance to refile an amended version of several of them.)
In January, Amazon quadrupled the free delivery threshold on Amazon Fresh groceries from $35 to $150 — tacking on a service charge on smaller orders. It later opened up grocery delivery to non-Prime members, who still have to pay a separate service charge. Then, in October, Amazon lowered the free grocery delivery threshold to $100.
A monthly subscription to unlimited grocery delivery will likely appeal to the heaviest users of Amazon Fresh — who rely on the service for all or at least the bulk of their grocery shopping. The $35 threshold is low enough to appeal to smaller households or single people who make fewer purchases. But for less frequent customers of Amazon Fresh, paying nearly $120 a year extra is a tougher sell.
Whole Foods customers, however, are a different story: Paying a monthly charge of $9.99 for unlimited Whole Foods grocery delivery (as opposed to $9.99 for each individual order) seems like a bargain in comparison.