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Target increases its free shipping threshold as Amazon drops it

Source: Target

Here's a new wrinkle in the free shipping wars.

Target boosted its free shipping threshold on Sunday to $35 from $25, the company told CNBC.

The higher threshold comes as Amazon slashed its minimum purchase for non-Prime members by $10 to $25, from $35. Wal-Mart rolled back its free shipping threshold to $35 in January for two-day shipping.

Target began offering its $25 threshold in February 2015. Prior to that, shoppers needed to spend $50 to qualify for free shipping.

"Target regularly reviews and adjusts our online shipping policies and practices to better serve guests and enhance our business" the retailer said in a statement. No official press release or blog post went up announcing the move.

Things won't change for Target's REDcard cred or debit cardholders. They will continue to receive free shipping online with no threshold in addition to 5 percent off every purchase.

While Target won't disclose specific statistics regarding the percentage of online orders that qualify for free shipping by hitting $35 or using the Target REDcard, the retailer says "a small percentage of Target.com purchases are less than $35, so the majority of orders will continue to ship for free."

Shipping is a growing expense for retailers including Target as online orders grow. In addition to distribution centers, Target has more than 1,800 stores in the U.S. and in February, CEO Brian Cornell told the financial community Target is shipping directly from around 1,000 of its stores, with stores fulfilling 68 percent of orders placed online during the 2016 holiday season.

The retailer has seen choppy sales over the past year, most recently turning in a disappointing holiday quarter. Target is spending $7 billion over several years to invest in its digital operations, existing stores and lowering prices.

Earlier Monday, the company said it is testing a program, called Target Restock, to let customers order household essentials and have them delivered to their homes the next day.

(Correction: A previous version of this story misstated Amazon's previous minimum shipping threshold. It was cut by $10 to $25, from $35.)