Direct-to-Customer Commerce

Icon

Strategic insights into the direct commerce industry, including ecommerce, direct marketing and related fields

Amazon’s Same-Day Delivery Will Shake Up Retail

The title of this post is the headline of an article posted at Ecommerce Times on Jan 17, 2013.  Here’s a link.

The article points out the very convenient solution Amazon can provide in some high-density markets for customers who are willing to pay for the convenience of not having to actually go to a store themselves for something they need today.

The author then proceeds to describe some of the warehouse systems, which Amazon uses to facilitate their same-day delivery service, including a reference to Kiva Systems.  Kiva Systems provides robots for use in the Pick & Pack process of direct-to-customer fulfillment centers.  It’s a great systems … I met with the founder when he was looking for both initial funding and early clients (back in 2003 or so).

But we need to keep this “same day delivery” thing in some context.

According to data from the Department of Commerce, under the category of Retail Sales, Mail Order and Ecommerce Sales still amounts to only seven percent of total retail sales … yes, 7%.

Now, that’s still a significant number.  And for some retailers, it may even account for a major percentage of their annual profit.

Please take note that in most direct commerce research, “free shipping” remains among the most effective promotions.

But given that same day delivery will only appeal to the more affluent, for whom delivery cost is not as significant as convenience, and given that all direct commerce accounts for only 7% of total retail sales … it’s somewhat of a stretch to say that same day delivery will “shake up” retail.

A bit too much hyperbole, for me

Advertisements

Filed under: Direct Commerce, Ideas, Opinion, , , , , , , ,

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

Twitter Updates

  • Men are moved not by the reaching of the goal, but by the grandness of effort involved in getting there—or failing to get there. #MaxLerner 2 days ago
  • Establishing goals is all right if you don't let them deprive you of interesting detours. #DougLarson 3 days ago
  • It's hard to decide if TV makes morons out of everyone, or if it mirrors Americans who really are morons to begin with. #MartinMull 4 days ago
  • Having a family is like having a bowling alley installed in your head. #MartinMull 5 days ago
  • A cult following is a nice way of saying very few people like you. #MartinMull 6 days ago
%d bloggers like this: