Instacart is slashing prices as the war against Amazon heats up.
Instacart, an online grocery delivery service that pairs customers with personal shoppers to deliver groceries to their homes, has quietly reduced the price of its annual Express membership and non-membership delivery fees, a spokesperson for the company confirmed to Business Insider on Wednesday.
Customers now pay $99 a year rather than $149 for the Express membership, which offers free delivery on orders over $35. Non-Express delivery fee charges have been cut from $5.99 to $3.99.
Instacart has also removed the 5% service fee for its Express members, a charge that caused much controversy among customers in the past.
A spokesperson for the company told Business Insider that these changes were rolled out on November 14.
Instacart partners with 300 different chains across the US, including Amazon-owned Whole Foods. The new changes make Instacart more competitive on price and allow it to better compete with Amazon, which it battles with directly at Whole Foods.
An Amazon Prime membership, which enables customers to use its Prime Now delivery service for Whole Foods groceries, costs $119 a year or $12.99 a month. Two-hour delivery is free for any orders over $35 and costs at least $4.99 for orders under that.
Until Amazon announced that it would be buying Whole Foods in June 2017, Instacart had been the only carrier to offer the Whole Foods delivery service.
The announcement sent shockwaves through the market and put Instacart, which had exclusive rights to Whole Foods’ delivery at the time, in a sticky situation. Experts speculated that it wouldn’t be long before it was muscled out.
These price cuts address a key issue that shoppers have had — why would they pay more for an Instacart membership when an Amazon Prime membership not only costs less, but has more perks? By undercutting Amazon on price, Instacart may now become a more appealing option, at least for Whole Foods delivery.
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