Amazon Boosts Prime Benefits With Grubhub Partnership, Takes Aim At Walmart

Zinger Key Points
  • Amazon now offers Prime members a free Grubhub subscription as a permanent benefit, enhancing the $139-a-year loyalty program.
  • Non-Prime users can place Grubhub orders through Amazon's website and app, broadening access to the food delivery service.

Amazon.Com, Inc AMZN now offers Prime members free Grubhub subscriptions, enhancing its $139-a-year loyalty program. Previously, Prime members received a yearlong Grubhub subscription with free delivery on orders over $12.

This new deal makes Grubhub a permanent Prime benefit, allowing non-Prime users to place Grubhub orders through Amazon’s website and app, CNBC reports.

This deal could make Grubhub more appealing to potential buyers, as Just Eat Takeaway has been trying to sell it since its acquisition, Reuters cites analyst Panmure Gordon.

In 2023, about 167 million Amazon customers in the U.S. subscribed to Prime, representing 71% of all users in the country.

Amazon has been increasing Prime benefits to attract and retain members amid competition from Walmart Inc WMT and Target Corp TGT.

Recent additions include a discounted One Medical membership, fast shipping, and video streaming.

In July 2022, Amazon secured rights to a 2% stake in Grubhub, potentially increasing to 15% based on performance factors.

After its first-quarter performance, analysts flagged Amazon’s retail margin expansion and GenAI revenue as major upside drivers. According to analysts, the company’s scale and strong cash flow enable substantial investments while expanding margins.

Amazon stock gained 50% in the last 12 months. Investors can gain exposure to the stock via VanEck Retail ETF RTH and ProShares Long Online/Short Stores ETF CLIX.

Now Read: US Q1 Economic Growth Downwardly Revised To 1.3%: Consumer Spending Falters

Photo: rblfmr/Shutterstock

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