Monthly Archives: April 2016

Amazon Same-Day Delivery Gets Bigger, Adds 11 More Cities

same day deliveryOne thing for sure when it comes to Amazon and its’ growth pursuits regarding Same-Day Delivery, is the retailer is without question going nationwide with it.  It is no longer about Amazon offering the service in select major US cities, but its’ latest move speaks to providing same-day delivery in every major city.

Forbes recently reported Amazon has announced that it is adding 11 more major US cities to its’ current free same-day delivery program.  The new additional US cities include Sacramento, Stockton, Charlotte, Cincinnati, Fresno, Louisville, Raleigh, Richmond, Tucson, Milwaukee, and Nashville.  Amazon isn’t just aimlessly rolling out same-day delivery anywhere. Anytime the service is targeted and expanded into a specific city, it must have the right mix of demographics, infrastructure and volume to make it work.  Amazon has found the delivery formula and marketing strategy to consistently keep shoppers using the same-day service option.

Its’ Prime membership subscription is really the core driver behind Amazon’s thriving same-day delivery.  “Prime was developed to make shopping on Amazon fast and convenient, and millions of members have used Prime FREE Same-Day Delivery to make their lives even easier,” stated Amazon Vice President of Prime Greg Greeley in the article.  “We keep making Prime better, and as our operational capabilities grow, we will continue to invent and expand delivery options that customers love.”  Various delivery options indeed is what Amazon is offering, including Prime Now, which they can order tens of thousands of essentials and gift items via native mobile apps and have them delivered within two hours, in addition to restaurant deliveries.

Prime is a definite focus for Amazon to generate loyal customers.  Earlier this year, Amazon decided to attract more customers to Prime by raising its’ minimum order size from $35 to $49 to qualify for free two-day shipping.  Prime members will be able to get same-day service free in these cities for the same $35 qualifying order amount, where as Non-Prime members won’t.  The fee increase may not capture most shoppers, yet it may in fact persuade regular users to go Prime.

These new cities will bring Amazon’s market count up to 27 total.  Amazon already has free same-day delivery in the San Francisco Bay Area, Seattle-Tacoma, Dallas-Fort Worth, San Diego, Indianapolis, Phoenix, Tampa Bay, Baltimore, Boston, Washington DC, New York, Philadelphia, Chicago, Atlanta, and Orlando.  It also launched free same-day delivery in 14 metropolitan cities the US, starting with California cities last year.  Whether Amazon will expand its’ services more this year isn’t certain; however, most retailers that engage in a successful same-day delivery program, will expand before the holiday season.  With how the retail leader has been aggressively rolling out the service, at least one more expansion is to come.

A number of e-retailers, brick-and-mortar stores, department store chains and others have all jumped into the same-day delivery race, partnering with a Same-Day Courier like AQuickDelivery.  The Atlanta Courier has the courier expertise to create a delivery logistics solution to compete online.  Amazon is offering a variety of delivery options to meet customer demand and AQuickDelivery can help businesses do the same.

Reference: 4.8.16, www.forbes.com, Amit Chowdhry, Amazon Adds 11 More Cities To Same-Day Delivery Service

Postmates Launches Amazon Prime-Like Same-Day Service

bike messengersNo retailer is out to incur losses when they venture out into Same-Day Delivery, nor does a delivery company either.  PostMates is a company pursuing to dive deeper into capitalizing on delivering online retail items.  It’s latest move shows that PostMates is after competing within the same-day delivery market, even if it has to take an Amazon approach.

Bloomberg has reported that PostMates is launching an Amazon Prim-like service.  The program is called Postmates Plus Unlimited, which will costs $9.99 a month and will have a subscription-based strategy just like Amazon.  Its’ subscribers will get free same-day delivery on orders of $30 or more from Postmates’s partners, which include some 3,000 stores and services in nationwide.  Subscribers will also avoid paying the 9% service fee that Postmates usually charges customers per order.

Amazon is doing some growth of its’ own, even with making its’ Prime service bigger.  Its’ annual Prime fee can account for between $4 billion and almost $6 billion in revenue per year, based on estimates in the range of 40 million to 60 million members.  Also, Prime customers spend about double what non-members have over the course of the year, so it makes sense why Amazon is analyzing what can turn border line non-members to switch to Prime. Postmates is seeking to achieve a high-level of on-demand success also.

PostMates is aiming for a service similar to Amazon Prime.  PostMates co-founder and chief technical officer Sean Plaice “The great thing about Amazon Prime is it centers everyone’s default e-commerce to Amazon, and on Amazon, you default to products on Prime.  That’s the same thing we’re looking to have here. Why use any service but Postmates to get your food delivered? You have a subscription. It gives you the best, most affordable delivery.”

The article also discussed how PostMates isn’t initially putting a priority on its’ profit margin.  “We’re willing to sacrifice a bit on our margins to give our customer a much better experience,” Plaice said. “We know that—ultimately, strategically—this is the business we want to build, something that’s affordable to everyone.”  More than likely, PostMates is looking to aggressively enter the market and see what it can gain, especially competing against a robust Amazon.  Once PostMates establishes itself in the eyes of shoppers, then it can probably look to shift its’ pricing.  This is not out of the ordinary with on-demand delivery.  Yet, the way online retail is growing, same-day delivery is bound to become a staple service as shoppers become more comfortable with buying online.

In order not to, some of the competencies it takes are the right demographics, location, delivery expertise, and delivery fleet to match.  PostMates has engaged in several moves to advance with the service.  At one point last year, PostMates was moving toward offering a new same-day delivery rate of $1 to outpace the market.  They would charge $1 per piece within each order, as well as a 20% delivery fee.  PostMates also has done work for Amazon as well.

The company utilizes local couriers to perform deliveries.  Most retailers that have a same-day delivery program do the same, partnering with a Same-Day Courier like AQuickDelivery to perform the actual service. The Atlanta Courier has the courier expertise and driver fleet that covers Georgia, in addition to having the ability to service nationwide.

Reference:  3.31.16, www.bloomberg.com, Ellen Huet, Postmates Starts an Amazon Prime-Like Service for Delivery

Whole Foods Expands Same-Day Grocery Delivery Via Instacart App

online shoppingWhen it comes to grocery delivery services the same day, many food stores are seeking to master how they can capitalize online.  Retailers like Amazon, BestBuy, Macy’s, Wal-Mart, and more are doing it, therefore, grocery stores want to do it too.  That’s what Whole Foods has done already, being involved in Same-Day Delivery of groceries in multiple US cities already.  Now, the popular supermarket chain is looking to take their same-day service farther this year.

Internet Retailer recently reported that Whole Foods is planning to expand its delivery services with the mobile grocery shopping app Instacart. The grocery store chain has been partnering with Instacart since 2014. The new growth means that Whole Foods will be adding an unspecified number of markets in which it will offer same-day grocery delivery, in addition to the 17 metro areas where Whole Foods customers already have the Instacart delivery option.  More and more customers are finding convenience with food shopping to be what a service like this provides.

With any same-day delivery of product, pricing has to be rival in order to be attractive to food customers, yet at the same time be competitive.  Whole Foods’ grocery delivery offers its’ service for $5.99, which is done within an hour.  Customers also can get two-hour delivery for $3.99.  The pricing is right in line with its’ competitors, as well as fast delivery.  Food delivery has to be performed within a short window because of its’ nature.  A number of supermarket chains engaging in same-day delivery partner beyond their application, utilizing a reliable Same-Day Courier like AQuickDelivery to do the actual deliveries.  The Atlanta Courier actually does deliveries for Whole Foods throughout that area.

Instacart CEO Apoorva Mehta commented in the article regarding the continued growth with Whole Foods, affirming that the grocery retailer is after creating the right ominchannels to move store food products via e-commerce.  He stated, “Instacart and Whole Foods Market share a mutual commitment to providing our customers with the easiest and most seamless grocery shopping experience possible.  We look forward to continuing to innovate with Whole Foods Market in the services that we can bring to users.”

The article mentioned how shoppers can order groceries from Whole Foods via Instacart’s mobile app or website in 17 markets including Chicago, Boston, San Francisco, and Washington, D.C. and more.  At the time of the announcement, the new expansion markets include Orange County, California, and Baltimore.  However, Whole Foods has been reaching more customers that are on the go, and it makes sense to continue making same-day grocery services available in major cities.

Whole Foods is doing whatever it takes to capture more food shoppers, even using coupons.  Just last month, Whole Foods released online coupons through Instacart’s mobile app.  Other supermarket competitors will have to keep pace with the same-day food delivery trend, as Google, AmazonFresh and other e-retailers flood online grocery retail.

Reference:  3.10.16, www.internetretailer.com, Matt Linder, Whole Foods expands delivery services with Instacart

Nordstrom Looks To Figure Online Retail, Could Utilize Same-Day Delivery

iStock_000017689280_SmallThere are a lot of things that retailers can do to gain ground online, especially with with competing against the likes of Amazon, Google, Wal-Mart, BestBuy, and more.  All of these retailers are thinking outside the box when it comes to being successful.  One of the services that physical store retailers are doing is offering online store pick up options for shoppers.  It allows shoppers the convenience of ordering online, and then, picking up their order at a nearby store, versus having to travel to the store and shop.  It saves gas and time for shoppers that desire just to simply get in and out of the store.

Nordstrom is one retailer in a rock and a hard place, trying to figure out how to excel online.  It is is definitely the way to create the omni-channel between e-commerce and store sales.  In a recent article by Internet Retailer via Bloomberg News, Nordstrom stated that it expects online sales to account for 30% of the company’s business by 2020.  This is up from 8% in 2010.  Online retail is the key for Nordstrom to thrive in the years to come, yet it will need to make the necessary strategic moves to get there.

The recent share falls by the retailer shows that it is not where it desires to be yet.  Shares fell by 30% in the past year, and Chief financial officer Mike Koppel discussed what is hurting the bottom line for Nordstrom.  The article stated, “He explained that the “old model”—big physical stores located mostly in malls—came with high fixed costs, but high leverage. In other words, you had to pour a lot of money into literal bricks and mortar to build stores and train staff, but once your sales reached a sort of break-even point, all the rest was gravy. In essence, the money from a banner sales year could flow straight down to the bottom line once those initial costs were paid for. And that became pretty easy to anticipate and plan against.  Enter the Internet, where the promise of high profits came from the theory that a retailer could sell stuff without having to pay for the overhead expenses of operating locations and hiring lots of labor. Not exactly, Koppel says.”

It went on to say that online sales came with low fixed costs, but the price tag was high variable costs.  This adverse effect is that as Nordstrom sells more online, the more it has to pay for pick, pack and delivery for those goods.  Furthermore, Koppel said, “business has been flattening in malls and growing in e-commerce, and so the two strong trends are impacting operating margins”.  Koppel stated that is there “anyone out there” who has figured it out, because “we have a lot of work to do.”  Nordstrom could partner with a Same-Day Courier like AQuickDelivery to help create a same-day logistics solution for its’ online retail challenges.

It will take more online innovation to compete, especially with front runner Amazon.  The retailer has decided to capitalize on capturing the market of customers that desire a more convenient way of shopping via same-day delivery in a number of major cities across the US.  It provides same-day delivery in the San Francisco Bay Area, Seattle-Tacoma, Dallas-Fort Worth, San Diego, Indianapolis, Phoenix, Washington DC, Tampa Bay, Baltimore, Boston, New York, Philadelphia, and Atlanta.  It also launched free same-day delivery last year in 14 metropolitan cities the US, starting with California cities, recently adding Orlando and Chicago.

The Atlanta Courier has provided Same-Day Delivery for Nordstrom within that city.  AQuickDelivery can develop online in-store services not only in Atlanta, but nationwide.  Department store retailer like Macy’s, has jumped head first into both online store pick up and same-day delivery to meet the needs of shoppers.  Nordstrom could very well do the same.

Reference:  3.14.16, www.internetretailer.com, Bloomberg News, E-commerce eats into Nordstrom’s profits, and that’s OK