Amazon Launches Under-$5 Grocery Brand to Rival Walmart

Amazon launched a new private-label brand called “Amazon Grocery” on Wednesday, offering US shoppers more than 1,000 everyday food essentials mostly priced under $5 to combat rising grocery costs. This budget-friendly lineup, featuring everything from fresh produce and milk to meat and seafood, is now available both online and at physical Amazon Fresh store locations.

Consolidating Brands for Smarter Shopping

The e-commerce giant is streamlining its grocery strategy by merging its existing Amazon Fresh and Happy Belly product lines into this single, unified collection. According to the company, the move aims to simplify the shopping experience while delivering high-quality essentials at highly competitive price points.

“During a time when consumers are particularly price-conscious, Amazon Grocery delivers more than 1,000 quality grocery items across all categories that don’t compromise on quality or taste — from fresh food items to crave-worthy snacks and pantry essentials — all at low, competitive prices that help customers stretch their grocery budgets further,” stated Jason Buechel, Vice President of Amazon Worldwide Grocery Stores and CEO of Whole Foods Market, in a press release.

Challenging Walmart and Target in the Budget Space

With this launch, Amazon is positioning itself to directly challenge established retail giants. The new line is set to compete head-to-head with Walmart’s highly successful Great Value brand and Target’s popular Favorite Day label.

What is on the Menu?

The initial rollout of Amazon Grocery includes newly introduced items such as fresh bakery cinnamon rolls, refrigerated pizza dough, and bottled spring water. However, the expansion will not stop there. Over the coming months, consumers can expect a wider selection, including frozen pasta meals, pie fillings, granola, sliced loaf cakes, and an expanded variety of deli meats.

Amazon’s Growing Private-Label Empire

This launch is part of a broader, ongoing effort by the retailer to capture budget-conscious shoppers. Just last year, the company introduced its “Amazon Saver” brand, which focuses on ultra-low-cost pantry staples like condiments and canned goods.

The strategy appears to be paying off. Amazon reports that its private-label brands are experiencing significant momentum, with shoppers purchasing 15% more private-brand items in 2024 compared to the previous year across its ecosystem, which includes Amazon.com, Whole Foods Market, and Amazon Fresh.

To support this growing demand, Amazon recently expanded its delivery capabilities. Last month, the company announced that shoppers in over 1,000 US cities can now order perishable food items—including dairy, fresh produce, meat, and baked goods—through its Same-Day Delivery service, seamlessly combining grocery shopping with orders for electronics and household goods.