Amazon Prime Subscriptions Now Include Grubhub Food Delivery

According to Amazon, the multilevel streaming giant is now providing its Prime members with a Grubhub food delivery subscription.

CNBC reports that the company previously provided a free year-long subscription to the delivery service, which included free delivery on all orders over $12.

Now, however, the $139-per-year Amazon Prime membership includes a permanent subscription to Grubhub. Customers can also place Grubhub orders through the Amazon website and app, even if they don’t have a Prime subscription.

Per Amazon, “Prime members can now enjoy all the savings perks of Grubhub+ on an ongoing basis without automatically renewing into a paid Grubhub+ membership: $0 delivery fees on eligible orders over $12, lower service fees, 5% credit back on pick-up orders, and exclusive offers.”

Additionally, to celebrate the news, Prime members can “save $5 on a Grubhub delivery order over $25 from now through June 2 with the code ‘PRIME5.’” Users can enter the code during checkout directly on Grubhub or on Amazon.com and the Amazon Shopping app.

News of the new offering comes amid Amazon’s efforts to woo customers as it faces increasing competition from the likes of Walmart and Target, who are reportedly siphoning customers away from the retail giant.

But the marriage of Amazon Prime and Grubhub is also part of a larger strategy: In July 2022, Amazon secured a 2% stake in Grubhub, which is a U.S. subsidiary of the British-owned Just Eat Takeaway.com. The parent company of Grubhub also claimed that Amazon may secure a larger stake — as much as 15% — in the company if certain performance targets are hit.

What’s more, Amazon Prime’s new offering alongside Grubhub could be part of the company’s efforts to recoup its losses from Amazon Restaurants, which the company launched in 2015 and shuttered four years later to focus on its grocery delivery service.

Despite the surface benefits, Amazon Prime and Grubhub’s partnership will be facing some steep competition from Target’s “Project Trident,” which is similar to Amazon Prime and includes the integration of Shipt, Target’s own grocery delivery service.

However, Target recently reported a decrease in quarterly revenues. In its most recent earnings report, Target reported a 3.7% decline in comparable sales.

The message to Amazon, Target, and comparable retailers with subscription programs is to keep their revenue streams diversified. Prime, of course, has a diverse offering that includes its own television and film studio, in addition to a partnership with Whole Foods Market and a “try-before-you-buy” clothing service, alongside this new offering with Grubhub, but competition for consumer dollars will continue.