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Same-day delivery is in. For shoppers who want to buy online but do not want to wait until their merchandise makes it to their doorsteps, there is now same-day delivery. And retailers are battling for a piece of the pie, wondering if quicker fulfillment by way of delivery could mean the difference between shopping cart abandonment and converted sales.
In 2014, Macy's, Bloomingdale's, Wal-Mart, Container Store and Foot Locker, among others, want their customers to experience the speediest possible service. The result of a mix of a genuine desire to offer convenience to shoppers and resignation to the fact that shoppers these days will shop online despite any and all efforts to get them into brick-and-mortar stores, same-day delivery is in its infant stages. Almost no one knows whether and how it will work—and more importantly, whether it's worth the investment and infrastructure to fulfill shoppers' need for instant gratification beyond in-store pickup.
Most rely on third-party courier services like Shutl, Deliv, Instacart, Postmates and Wun Wun to get the goods from local stores or warehouses to customers as soon as possible or within a timeframe selected by that customer at the time of purchase.
A September 2014 RBC Capital Markets study, "Amazon.com: Updating the Long Thesis," took a first look at the purchasing behaviors of shoppers who select same-day delivery—and pay a premium delivery fee—and those who opt for non-same-day delivery. According to the study, which looked at Amazon.com shoppers in the US over the 90 days before the study, nearly half of those opting for the same-day option bought books. Around 30% of customers purchased electronics and computers while one in five wanted their movies, music and games along with clothing, shoes and jewelry delivered to them as quickly as possible. Only 14% of respondents said they shopped same-day for beauty, health or grocery items. (As Amazon pushes further into the grocery space with AmazonFresh and steadies its operation, full same-day grocery runs—produce and all—could be conducted on the platform with greater ease and frequency, posing a challenge to pure plays like FreshDirect and Peapod as well as brick-and-mortar grocers like Whole Foods, which recently teamed up with Instacart to break into the same-day market.)
For now, investment in same-day delivery seems to be paying off for Amazon. Eleven percent of those polled said they shopped once a week and 5% reported shopping more than once a week, as long as same-day delivery was involved. Comparatively, only 6% of non-same-day delivery shoppers ordered once a week, and an even smaller 3% purchased more than once a week when opting for non-same-day delivery. On the whole, same-day delivery users shopped frequently, skewing toward shopping once every three months or more often; non-same-day delivery users skewed toward shopping on Amazon once every six months or less.
With early footholds in several major US cities, from New York and Philadelphia to Indianapolis and Dallas, Amazon still has to work out some of the kinks—adding inventory, adjusting pricing based on customer loyalty and ease of delivery, and getting the word out. The hope is that adding AmazonFresh to its roster will make Amazon a one-stop-shop for its customers, driving up the frequency with which users purchase and driving down delivery costs on its nongrocery items.
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