The Tip Jar: Is Amazon Prime cheaper than Walmart for groceries?

Amazon recently reduced the cost of a Prime membership for low-income Americans – which some say is a strategy to steal customers from Walmart.

Making the headlines recently was news that Amazon is dropping the cost of its Prime membership to $5.99 per month for people receiving government assistance.

Commentators said the move was another sign the online giant was taking a shot at Walmart (where 1 in 5 shoppers use food stamps) by offering lower-income Americans access to the free, same-day delivery Amazon Prime Now grocery service.

But is it worth it for these shoppers – or indeed, anyone who pays the full $99 a year for Prime – to get their groceries from Amazon? We've compared prices to see how they stack up.

How I did the comparison

Since Amazon doesn't have own-brand items this is a like-for-like comparison, matching name brands sold on Amazon Prime Now with the same products in Walmart.

Amazon also doesn't currently sell any meat products (though AmazonFresh, which is not available in Minnesota, does). So I've taken a look at 51 products across the produce, dairy, household cleaning, personal care, snacks, canned goods, frozen and bakery departments.

I compared Amazon Prime Now's prices – which you can check out here – with the Walmart in Richfield, Minnesota.

Prime membership entitles you to free two-hour delivery with Prime Now, but only in select markets. That includes the Twin Cities, but you're out of luck if you live outside the metro.

I didn't include the cost of Amazon Prime. I don't think the $5.99 or $8.25 per month (depending on your rate) would be hugely different from what you'd spend on gas/the bus to go to the grocery store several times a month.

Total cost

Amazon – $159.55

Walmart – $148.70

Sorry, multinational online giant, but you're still not beating Walmart when it comes to price. (Albeit getting it delivered to your doorstep certainly says something for convenience.)

That said, the price difference wasn't as significant as I expected it to be, and it would probably put Amazon on a similar level with HyVee, Target and Cub Foods based on our previous grocery comparisons.

But bear in mind that if you're a more frugal shopper, there are probably plenty of occasions where you could choose cheaper, own-brand products at any of these grocery stores, much like you could do at Walmart but can't at Amazon. (It should be noted Tip Jar has also surveyed Aldi – which is even cheaper than Walmart).

Click here to see a spreadsheet featuring the price comparison for every Amazon-Walmart item.

Is there anything Amazon was cheaper in?

The most fair comparison, where name brands aren't really an issue, comes in the produce department, and this is one area where Amazon was quite a bit cheaper.

I surveyed 11 items at various weights: Bananas, baby carrots, strawberries, mushrooms, russet potatoes, Fuji apples, red grapes, red onion, blueberries, green beans and jalapenos.

Amazon Now's produce price came in at $29.94, a few bucks cheaper than Walmart which came in at $33.35.

Much of this as down to the $4.29 for a pint of blueberries offer from Amazon, with Walmart charging $4.46 for only 6 ounces.

Where was Walmart particularly cheap?

Walmart was cheaper in most categories, and it's fair to say that on the whole you spend a little less shopping for name brands at Walmart.

Dairy was a few bucks less expensive at Walmart. Same goes for the cereal department, canned goods and household/personal care products.

Snacks were pretty comparable between the two, as were drinks and bakery products, with only a few cents separating each retailer in those categories.

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