Starting Wednesday, Prime subscribers in more than 1,000 cities, including Phoenix, Raleigh, and Tampa, can now order fresh produce, dairy products, meats, and frozen meals for delivery within hours. The service is free for Prime members on orders above $25, while non-Prime shoppers can access it for a $12.99 fee per order.
The rollout significantly lowers costs for Prime members, who previously had to use Amazon Fresh or Whole Foods for grocery delivery and pay an extra $9.99 per month for free delivery on orders above $35. By reducing the threshold to $25 and folding the service into Prime at no additional charge, Amazon is positioning itself as a more appealing choice for quick, smaller grocery runs — a key advantage against Instacart’s core offering.
“This is a major expansion for Amazon’s digital grocery service,” said Blake Droesch, analyst at eMarketer. “Lowering the order minimum to $25 directly threatens Instacart’s value proposition of quick, one-off purchases.”
The strategic shift is already making waves in the market. Amazon’s shares rose 1.4% on Wednesday afternoon, while competitors felt the sting — Instacart shares plunged 12.4%, DoorDash fell 4.8%, Kroger dropped 4.2%, Walmart declined 2.3%, and Uber, the parent company of Uber Eats, dipped 0.8%.
Amazon’s push into faster perishable delivery comes alongside a broader $4 billion investment to expand same-day and next-day logistics to more than 4,000 rural U.S. communities by year-end. The company’s ambitions, however, extend beyond the grocery aisle. As Doug Herrington, CEO of Worldwide Amazon Stores, noted: “Amazon shoppers can order milk alongside electronics and have everything delivered to their doorstep within hours.”
The timing also reflects intensifying competition in the grocery and delivery space. Walmart recently announced plans to offer delivery within three hours to 95% of the U.S. population, while faster delivery speeds have become central to its growth strategy.
Analysts warn that Amazon’s aggressive expansion could put pressure on small, independent grocers and erode margins for food delivery players like Uber Eats and DoorDash. Yet, the key to Amazon’s success will be execution. “This will likely grow Prime membership,” said Brian Mulberry of Zacks Investment Management. “But high-quality service will be critical to sustaining that growth.”
For now, U.S. shoppers have another reason to see Amazon as not just the place for books and electronics, but for same-day milk, strawberries, and steak — all in the same basket.