The battle for customer loyalty heats up ahead of the holiday season! Walmart (WMT.US) launches a $120 membership package, going head-to-head with Amazon Prime and Costco.

According to reports from Zhihui Finance APP, Walmart (WMT.US) this week launched a joint membership package for Walmart+ and Sam’s ClubPlus, directly targeting Amazon (AMZN.US) Prime members and Costco (COST.US).

This joint annual membership costs $120, saving $100 compared to purchasing each separately for a year. The price is $19 cheaper than Amazon Prime’s $139 annual fee and lower than Costco’s $130 Executive Membership, but it is $55 more expensive than Costco’s $65 Gold Star standard membership. For consumers who currently subscribe to both Prime and Costco Executive Membership, switching to this bundled package can save up to $149 per year, offering the most significant discount.

“This is a direct hit at Prime,” said Brett Rose, CEO of the National Consumer Suppliers Association, in an interview. He pointed out that for an annual fee of $120, you can enjoy both warehouse membership benefits, delivery services, streaming content, and fuel discounts. Rose stated that in terms of cost performance, Walmart has already won hands-down on paper.

“The timing itself says everything. As the holiday season approaches, consumer budgets are tight; membership programs can lock in user loyalty and ensure steady recurring income before everyone finalizes their spending plans,” Rose said. “Membership plans are a way to retain users, but low prices are fundamental.”

On Wall Street, Oppenheimer analyst Rupesh Parikh and his team believe that the biggest winners of this new plan are consumers: the combination of membership benefits is richer, Walmart and Sam's goods can be delivered directly to homes without extra charges, and the additional upgrade cost is very low.

Parikh commented: “This new product further strengthens the value proposition of Walmart’s membership system compared to Amazon Prime and Costco. If this membership plan gains traction, Walmart is expected to capture a larger share of consumers’ wallets, especially in delivery services; though in the short term, the profit and loss statement will likely come under pressure.”

Looking ahead, by launching this plan just ahead of the holiday season, Walmart may force Amazon and Costco to intensify their promotions, further increasing competitive pressure.