Amazon Grocery vs. the Local Supermarket

Recently, I made an offhand mention that I’m a user of Amazon Grocery and this intrigued several commenters, so I thought I’d walk through the shopping process that leads me to using Amazon Grocery for some items.

Comparing Amazon Grocery to Your Local Supermarket

What’s Amazon Grocery?

For those unaware, Amazon Grocery is a section of where one can buy most dry grocery goods and have them shipped directly to your home. This ranges from things like baking mixes to things like diapers and baby formula. Rather than transporting them yourself, Amazon ships the items right to your front door.

As a rule of thumb, the prices at Amazon Grocery are usually a bit higher than the prices in the grocery store, but using it effectively offers several advantages that cause it to be much cheaper for us on many items.

Know the Prices

Before you even consider shopping at Amazon Grocery, know how much you’re spending on items at the grocery store. Take out your last few grocery receipts – including both food items and household stuff like laundry detergent, dishwashing detergent, etc. – and go through and mark everything that’s dry on that list. This gives you a baseline: you know exactly how much you’re paying for the item at your local store.

Once you have that in hand, fire up Amazon Grocery and start comparing prices. Almost always, the Amazon price will be somewhat higher than the price on your receipt – don’t sweat it quite yet.

How I Save Money Using Amazon Grocery

Of course, that baseline price for those items is just a starting point. Amazon offers a ton of ways for me to trim down that price and often get it to a level that’s lower than what the grocery store is offering. Here are the tactics I use.

1. I signed up for an Visa for my purchases there

You already need a credit card for your purchases there anyway and the bonus program is stellar if you use it exclusively for Amazon purchases (I use a Citi Driver’s Edge card for most of my purchases). When you sign up for that card when you’re processing an order there, you immediately get $30 off of your order. So, even on a one-time use situation, you can get $30 worth of free groceries shipped to your house.

2. I use that card for all purchases from Amazon

The card gives you 3% back in Amazon credit for all purchases done with the card on In other words, when you rack up $833 in purchases on the card, you’ll get a certificate in the mail with a $25 off coupon code on it.

3. I take advantage of “Subscribe and Save”

Let’s say you run through dishwashing detergent and laundry soap and diapers like clockwork. I know we do – I can practically set the clock by how often we need to refill stuff. If you sign up at Amazon for their “subscribe and save” program on these products, they let you schedule automatic purchases and shipments of these items to your home – and shave another 15%-20% off of the purchase price.

4. I keep an eye out for Amazon Grocery coupons

Once every few months or so, they’ll offer a coupon giving $10 off any Amazon Grocery purchase of $49 or more, which when compounded with the other stuff can really trim your costs.

An Example: Let’s say, hypothetically, that I only wanted to use Amazon Grocery to buy diapers. I log into Amazon and set up a plan to ship me a box of 126 Stage 4 Huggies every month for a year. The default price is high for that box ($34.99 for a box of 126), but not outrageous.

First, I sign up for the “subscribe and save” option. That takes the price down from $34.99 for the box to $27.99 a box. Then, when I check out, I sign up for that Amazon card – giving me the first box for free and $2.01 off the second box. This means that my cost for a year’s worth of these diapers shipped to my door is now $305.88 – a cost of $25.49 on average for each box, which is at or below what you’d pay at the store for the same box. Furthermore, I use the Amazon card for all of the purchases, getting myself about 40% of the way to a $25 gift certificate there. Even better, these diapers just magically arrive on my doorstep without having to worry about it.

…But Amazon Grocery Doesn’t Always Work

There are a lot of items where “subscribe and save” isn’t available or doesn’t make sense for you, and there are some items where the local store simply offers significantly better prices. It really pays to do the footwork and look beyond the initial price that you see – look at all of the savings available to you and see what is really your best deal.

I don’t use Amazon Grocery for all of the stuff that I could potentially get, but I do use it quite often – and if the price on Amazon ends up being virtually the same as the store cost, I use Amazon because it’s more cost-effective for me to have an item delivered to my front stoop than to grab it at the store, put it in the car, haul it home, and bring it inside. The scheduling is particularly convenient, too, if you can get the price point to the right level – the convenience of just having dishwashing detergent or laundry soap delivered to your door right on time, like clockwork, is quite helpful.

Trent Hamm

Founder & Columnist

Trent Hamm founded The Simple Dollar in 2006 and still writes a daily column on personal finance. He’s the author of three books published by Simon & Schuster and Financial Times Press, has contributed to Business Insider, US News & World Report, Yahoo Finance, and Lifehacker, and his financial advice has been featured in The New York Times, TIME, Forbes, The Guardian, and elsewhere.