It takes time to get a good delivery system going for a retailer to begin to see a profit with same-day delivery. It also take the right demographics and infrastructure to fit like a puzzle to make the service last. Some retailers are marketing it just right to be attractive to customers. However, the Denver Post is commenting that the fee for same-day delivery is what has shoppers talking.
According to an article by the Denver Post shoppers are enjoying the service aspect of same-day delivery, but not the price for it. More than likely, retailers are seeking after a way to make their deliveries free, such as Amazon. The retail leader has launched free same-day delivery in 14 Los Angeles metropolitan cities earlier this year, as wells as recently adding Chicago and Orlando. This makes Amazon’s total of same-day markets is 16, and they are anticipated to grow even more throughout the US. Same-day delivery is free for Prime members for all orders over $35.
To make the service free is an idea from Amazon, which appears to have the model that shoppers want. Since Amazon has broken the barrier, it has the retailers are trying to beat the retailer at something it appears to be mastering. Shipping industry expert Satish Jindel stated in the article, “Retailers trying to compete with Amazon on the road Amazon created will always be at a disadvantage”. Where Amazon is going, other retailers take notice and are making striders to keep up.
Macy’s is one the biggest competitors of Amazon when it comes to same-day delivery, partnering with Deliv to make it happen. Deliv CEO Daphne Carmeli said, “Over the past 18 to 24 months, Amazon has been pushing the bar” for fast and cheap delivery. If you’re in retail, you have to step up to the new bar.” The crowdsourcing approach by Deliv causes its’ delivery model to work for Macy’s. The department store leader has 17 US markets that it is providing same-day delivery, which is more than Amazon. It has over 800 stores that makes pick up and local delivery easy. For all orders over $99, shoppers can get same-day delivery for only $5.
Most retailers are charging between $5 and $20 for their same-day delivery service. Etsy and Apple are both working with Postmates in New York for door-to-door service for a $15 flat fee. Wal-Mart, Kohl’s, BestBuy, Ace Hardware, and others are all engaged in some form of same-day delivery. It takes a good driver fleet to get deliveries to their destination within hours on a consistent basis. Yet, the service charge is what handles driver costs, fuel and infrastructure.
The demand for same-day delivery will continue to grow, and retailers will have to find the right mix between being cheap for the customers and making a profit for themselves. A Same-Day Courier like 1-800 Courier can help retailers develop an optimal same-day solution to accomplish both. The Houston Courier has the courier delivery expertise to get your online items to your customers fast. For retailers, this is a fitting time to quickly implement same-day delivery to capture holiday sales.
Reference: 11.29.15, www.denverpost.com, Mae Andersen, Everyone loves same-day delivery, until they have to pay
