Amazon drops free shipping minimum in tussle for holiday sales

Amazon.com Inc said on Monday it would offer free shipping with no purchase minimum for the first time this holiday season, heating up the competition with Walmart Inc and other rivals vying for customers' Christmas shopping sprees.

The U.S.-only promotion, effective from Nov. 5, waives the $25 minimum that customers outside Amazon's loyalty club Prime must hit for free shipping. The deal lasts until Amazon can no longer promise items in time for Christmas with free delivery, which typically takes five to eight business days.

The announcement could help Amazon sustain its rapid sales growth. Shares of the world's largest online retailer were hammered last month after it forecast the slowest rise in revenue at least since the start of 2016. The current quarter typically is Amazon's biggest.

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Jeff Bezos, Chairman and CEO of Amazon, speaks at the George W. Bush Presidential Center's Forum on Leadership in Dallas, Texas, U.S., April 20, 2018. Picture taken on April 20, 2018. REUTERS/Rex Curry
Amazon founder and CEO Jeff Bezos laughs as he talks to the media while touring the new Amazon Spheres during the grand opening at Amazon's Seattle headquarters in Seattle, Washington, U.S., January 29, 2018. REUTERS/Lindsey Wasson
2018 Vanity Fair Oscar Party ? Arrivals ? Beverly Hills, California, U.S., 04/03/2018 ? Amazon CEO Jeff and wife MacKenzie Bezos. REUTERS/Danny Moloshok
Amazon founder and CEO Jeff Bezos (L) answers a question from the media while getting a tour from Ron Gagliardo, senior manager of horticultural services for the Spheres, during the Amazon Spheres opening event at Amazon's Seattle headquarters in Seattle, Washington, U.S., January 29, 2018. REUTERS/Lindsey Wasson
Amazon and Blue Origin founder Jeff Bezos addresses the media about the New Shepard rocket booster and Crew Capsule mockup at the 33rd Space Symposium in Colorado Springs, Colorado, United States April 5, 2017. REUTERS/Isaiah J. Downing
Amazon founder and CEO Jeff Bezos looks over a balcony on the top floor of the Amazon Spheres during an opening ceremony event at Amazon's headquarters in Seattle, Washington, U.S., January 29, 2018. REUTERS/Lindsey Wasson
Amazon founder and CEO Jeff Bezos gives some closing comments after opening the new Amazon Spheres with some help from Alexa during an opening event at Amazon's headquarters in Seattle, Washington, U.S., January 29, 2018. REUTERS/Lindsey Wasson
Amazon and Blue Origin founder Jeff Bezos addresses the media about the New Shepard rocket booster and Crew Capsule mockup at the 33rd Space Symposium in Colorado Springs, Colorado, United States April 5, 2017. REUTERS/Isaiah J. Downing
Jeff Bezos, founder of Blue Origin and CEO of Amazon, speaks about the future plans of Blue Origin during an address to attendees at Access Intelligence's SATELLITE 2017 conference in Washington, U.S., March 7, 2017. REUTERS/Joshua Roberts
Jeff Bezos, founder of Blue Origin and CEO of Amazon, speaks about the future plans of Blue Origin during an address to attendees at Access Intelligence's SATELLITE 2017 conference in Washington, U.S., March 7, 2017. REUTERS/Joshua Roberts
Jeff Bezos, founder of Blue Origin and CEO of Amazon, arrives to speak about the future plans of Blue Origin during an address to attendees at Access Intelligence's SATELLITE 2017 conference in Washington, U.S., March 7, 2017. REUTERS/Joshua Roberts
Amazon CEO Jeff Bezos addresses the Economic Club of New York in New York City, U.S., October 27, 2016. REUTERS/Brendan McDermid
Jeff Bezos, owner of The Washington Post, delivers remarks at the grand opening of the Washington Post newsroom in Washington January 28, 2016. REUTERS/Gary Cameron
Jeff Bezos, owner of The Washington Post, delivers remarks at the grand opening of the Washington Post newsroom in Washington January 28, 2016. REUTERS/Gary Cameron
Jeff Bezos, owner of The Washington Post, delivers remarks at the grand opening of the Washington Post newsroom in Washington January 28, 2016. REUTERS/Gary Cameron
Jeff Bezos, founder and CEO of Amazon.com, leaves the Allen and Co's annual media conference in Sun Valley, Idaho July 10, 2014. REUTERS/Rick Wilking (UNITED STATES - Tags: BUSINESS)
Amazon CEO Jeff Bezos talks about his company's new Fire smartphone at a news conference in Seattle, Washington June 18, 2014. Bezos unveiled a "Fire"smartphone on Wednesday equipped with a 3D-capable screen and the ability to recognize objects, music and TV shows, hoping to stand out in a crowded field dominated by Apple Inc and Samsung Electronics. REUTERS/Jason Redmond (UNITED STATES - Tags: SCIENCE TECHNOLOGY BUSINESS TELECOMS)
Amazon CEO and Chairman Jeff Bezos receives the Citation of Merit on behalf of the Apollo F-1 Search and Recovery Team at the 110th Explorers Club Annual Dinner at the Waldorf Astoria in New York March 15, 2014. The club, which promotes the scientific exploration of land, sea, air and space featured catering by chef and exotic creator Gene Rurka. Chef Rurka prepared a variety of dishes featuring an array of insects, wildlife, animal body parts and invasive species. REUTERS/Andrew Kelly (UNITED STATES - Tags: SOCIETY SCIENCE TECHNOLOGY BUSINESS FOOD)
Amazon.com Chief Executive Officer Jeff Bezos speaks during a keynote speech with Amazon.com Chief Technology Officer Werner Vogels at the AWS Re:Invent conference at the Sands Expo in Las Vegas, Nevada November 29, 2012. REUTERS/Richard Brian (UNITED STATES - Tags: SCIENCE TECHNOLOGY BUSINESS)
Amazon CEO Jeff Bezos (R) arrives at the annual Allen and Co. conference at the Sun Valley, Idaho Resort July 12, 2013. REUTERS/Rick Wilking (UNITED STATES - Tags: BUSINESS HEADSHOT)
BERLIN, GERMANY - APRIL 24: Jeff Bezos attends the Axel Springer Award 2018 on April 24, 2018 in Berlin, Germany. Under the motto 'An Evening for' Jeff Bezos receives the Axel Springer Award 2018. (Photo by Franziska Krug/Getty Images)
Jeff Bezos, founder and chief executive officer of Amazon.com Inc., tours the Spheres during opening day ceremonies at the company's campus in Seattle, Washington, U.S., on Monday, Jan. 29, 2018. The Spheres, a new gathering and working space for Amazon employees located in the heart of the downtown Seattle Amazon campus, contains hundreds of plant species from cloud rainforest environments around the globe, and maintains a tropical climate similar to Costa Rica or Indonesia. Photographer: Mike Kane/Bloomberg via Getty Images
WASHINGTON, DC -DEC 14: Jeff Bezos, founder of Amazon.com (and owner of the Washington Post) arrives at the movie premiere tonight. -The world premiere of the movie, 'The Post' took place at the Newseum in Washington, D.C. tonight. All of the major stars of the movie and director Steven Spielberg attended as well as many local politicians and business people such as Warren Buffett. (Photo by Michael S. Williamson/The Washington Post via Getty Images)
Jeff Bezos, founder and chief executive officer of Amazon.com Inc., center, tours the Spheres during opening day ceremonies at the company's campus in Seattle, Washington, U.S., on Monday, Jan. 29, 2018. The Spheres, a new gathering and working space for Amazon employees located in the heart of the downtown Seattle Amazon campus, contains hundreds of plant species from cloud rainforest environments around the globe, and maintains a tropical climate similar to Costa Rica or Indonesia. Photographer: Mike Kane/Bloomberg via Getty Images
Amazon CEO Jeff Bezos arrives for the premiere of 'The Post' on December 14, 2017, in Washington, DC. / AFP PHOTO / Mandel NGAN (Photo credit should read MANDEL NGAN/AFP/Getty Images)
WASHINGTON, DC - OCTOBER 28: Honoree Jeff Bezos speaks at the 21st Annual HRC National Dinner at the Washington Convention Center on October 28, 2017 in Washington, DC. (Photo by Paul Morigi/Getty Images)
NEW YORK, NY - DECEMBER 14: Jeff Bezos, chief executive officer of Amazon, listens during a meeting of technology executives and President-elect Donald Trump at Trump Tower, December 14, 2016 in New York City. This is the first major meeting between President-elect Trump and technology industry leaders. (Photo by Drew Angerer/Getty Images)
NEW YORK, NY - OCTOBER 27: (L to R) Jeff Bezos, Chairman and founder of Amazon.com and owner of The Washington Post, addresses the Economic Club of New York as moderator Charlie Rose looks on, at the Sheraton New York Times Square Hotel, October 27, 2016 in New York City. Bezos discussed the future of Amazon, space travel, and his ownership of The Washington Post. (Photo by Drew Angerer/Getty Images)
SAN FRANCISCO, CA - OCTOBER 20: Founder/chairman/CEO of Amazon, Jeff Bezos, speaks onstage during 'The Prime of Mr. Jeff Bezos' at the Vanity Fair New Establishment Summit at Yerba Buena Center for the Arts on October 20, 2016 in San Francisco, California. (Photo by Michael Kovac/Getty Images for Vanity Fair)
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Amazon cut its order minimum for free shipping to $25 from $35 indefinitely in May 2017.

Monday's news will pile pressure on Walmart and Target Corp , which in recent years have chipped away at Amazon's lead with their own offers of free two-day shipping. While Walmart has maintained its $35 order threshold this holiday, Target has scrapped its minimum until Dec. 22.

Just over half of all U.S. households have a Prime subscription, analysts estimate. Prime remains the cornerstone of Amazon's business because shoppers buy more from the retailer once they pay $119 for the year-long membership. Perks include same-day shipping and video streaming.

Amazon is now courting those outside the club, hoping its brand and wider selection will set it apart. Free shipping can apply to hundreds of millions of items on Amazon, versus hundreds of thousands on Target. Target promises to deliver the items faster, however.

It was unclear how free delivery on small-ticket items would impact net income for Amazon, which last month touted improvements in efficiency.

According to the Seattle company's latest annual filing, shipping costs nearly doubled from 2015 to 2017, reaching $21.7 billion. (Reporting by Jeffrey Dastin in San Francisco Editing by Sonya Hepinstall)

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