Shape Walmart's Paid Membership Strategy to Win Households from Amazon Prime

You are a product manager at Walmart. The company wants to go head to head with Amazon Prime, Amazon's paid membership that bundles fast shipping with streaming and other perks. What product strategy would you propose? Explain which customers you would target, which benefits you would build or emphasize, how the program would win against Prime, and how you would measure progress. ```hint Compete where Amazon cannot easily follow Before listing perks, compare the assets each company already has, and ask which everyday purchases Walmart can serve better or more cheaply than Amazon, and which Prime benefits members would actually miss if they moved their spending. ``` ### Clarifying Questions - Should the strategy build on Walmart's existing paid membership, Walmart+, or does the interviewer want a program designed from scratch? - Does "compete directly" mean persuading households to cancel Prime, or becoming the membership they use first for everyday shopping even if they keep both? - Is the scope the US market only? - Must the membership be profitable on its own, or can it run at a loss if it raises members' total spending with Walmart? ### What a Strong Answer Covers - An honest comparison of the two companies' assets (store network, grocery strength and price position versus selection, delivery network and entertainment) and a clear choice of where to compete - A specific target household segment and its pain points, with a reason for choosing it over the alternatives - A prioritized set of membership benefits tied to those pain points, rather than a perk-for-perk copy of Prime - Membership economics: the fee, delivery cost per order, and where the margin comes from - Success metrics covering retention and share of household spending, with guardrails on cost and store operations ### Follow-up Questions - Amazon responds by cutting grocery delivery fees for Prime members. What do you change? - Would you add more entertainment benefits to the membership, and how would you decide? - How would you keep store-based order fulfillment from hurting the experience of shoppers inside the store?