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    Thursday
    May052016

    Can Fast Delivery Help Target & Wal-Mart Catch Amazon Baby Goods Sales?

    Without question in the online retail market, baby goods is the product category that is soaring above all others. It currently has very impressive numbers in regards to sales, and the retailer that is capitalizing on it is no other than Amazon. Between the e-retail leader, Wal-Mart and Target, Amazon has the highest share of the market. One reason Amazon does could very well have to do with free Same-Day Delivery in several major US cities. The question remains will Target and Wal-Mart go deeper into last-mile deliveries to compete with Amazon.

    The baby products category has the highest penetration of sales online, and 75% of those sales occur on Amazon.com, Walmart.com and Target.com. Internet Retailer discussed in a recent article how consumer research firm TABS Analytics' new study showed that e-commerce accounts for 20% of all sales in the baby products market, which totals $30 billion per year. This outstrips the 2% penetration for all other consumer packaged goods. Consumers that shop for baby goods online need them frequently, and the value-added service of convenience that same-day delivery brings could increase sales. This is why it is going to be interesting to see if Wal-Mart and Target beef up their same-day services as Amazon has done.

    “Online sales of baby products are out-competing all other segments of consumer packaged goods that we have surveyed over the last three years,” said TABS Analytics CEO Kurt Jetta in the article. “Brick-and-mortar retailers with e-commerce aspirations should treat baby product sales as the frontline of their battle for online success.” Online retail is forecasted to reach $500 billion by 2018, which means baby goods will be among the online products that grows even more than it has. Wal-Mart and Target could potentially develop more same-day delivery throughout the US to compete with Amazon. One thing we can be certain of, Amazon sees the value in the trending service option and will not be slowing down same-day delivery for no one.

    The numbers show indeed that Amazon has a larger percentage of the baby goods market online. The study also shows that 18%-24% of baby products purchases occur online. That means that Amazon/Diapers.com represents 43% of the baby products market online. Wal-Mart’s represents 23% and Target's is at 18%. All other e-commerce players roughly coves the remaining 12% of the market. The article also mentioned that Amazon with it's subsidiary Diapers.com, comprises 7.3%-10.6% of all baby products purchases nationwide. Walmart.com accounts for 3.7%-5.8% of purchases and Target.com represents 3.3%-4.3%.

    Based on the TABS survey of 2,000 consumers between the ages of 18-75, some additional findings in the article stated:

    • Households with children up to 5 years old are the heaviest buyers, accounting for 60%-70% of all purchases online and offline.
    • Households with young children purchase 8.5 baby product types per year, compared to 1.6 for all other buyers.
    • Roughly 40% of baby products are purchased by consumers who don’t have any young children in their households, which represents 71% of all households. The bulk of these purchases likely come from relatives or friends giving gifts.

    Wal-Mart and Target already are engaged in some level of same-day delivery. A Same-Day Courier like A-1 Express can partner with the retailers to create a same-day delivery program for hundreds of stores. The San Francisco Courier is a nationwide courier and has the expertise it takes to consistently fulfill orders for baby goods online.

    Reference: 4.20.16, www.internetretailer.com, Stefany Zaroban, Amazon, Target and Wal-Mart battle for online sales of baby goods

    Thursday
    Apr282016

    Roxbury Prime Members Want Amazon's Free Same-Day Delivery

    It takes a big retailer with all the right pieces to successfully implement Same-Day Delivery in major US cities, not to mention being capable to offer it free. No other than Amazon has cracked the code and is moving at a fast pace, adding one market area after another. Before long, the e-retailer is going to be providing free same-day delivery nationwide.

    Yet, there is one area in Boston full of Prime subscribers inquiring why same-day delivery hasn't come their way. The Boston Globe reported that Amazon offers free same-day delivery in every Boston neighborhood--except Roxbury. One of the findings by Bloomberg compared US census data that showed that minority neighborhoods in several cities have not been included to offer free same-day delivery. Roxbury is 59% African-American and is the "most striking gap" found from the data. The retailer's service stretches from Boston city limits to many suburbs and nearby communities, but for some reason, not in Roxbury.

    The article stated that per Amazon to Bloomberg, Roxbury’s circumstance is “an anomaly" and nothing else. Amazon gave Mattapan as a example, which is 85% African-American, as well as nearby majority-minority communities like Lawrence and Chelsea. There are no demographics that play a role in deciding where it delivers same-day. “Yet in cities where most of those paying members are concentrated in predominantly white parts of town, a solely data-driven calculation that looks at numbers instead of people can reinforce long-entrenched inequality in access to retail services,” said Bloomberg writers. Amazon spokesman Scott Stanzel responded in a statement, “We will continue expanding our delivery capabilities and are adding more zip codes rapidly”. Either way, the free same-day service is popular and Roxbury Prime members want it available in their city.

    For orders $35 and over, Prime members are able to receive same-day delivery free. This is very impressive, as well as attractive for shoppers that probably order from Amazon regularly above the threshold. They also pay a $99 annual fee to be a Prime member, which also includes Amazon's two-day free shipping as well. Prime is what Amazon is pushing more than ever, as the e-retailer increased the free two-day shipping threshold from $35 to $49 to qualify for free two-day shipping for Non-Prime members in hopes to convert them into annual subscribers.

    Amazon has been expanding free same-day delivery throughout this year, adding 11 more major US cities to its' free same-day delivery program, which included Sacramento, Stockton, Fresno, Cincinnati, Louisville, Raleigh, Nashville, and others. Boston was among the first large implementation of Amazon's free same-day delivery last year, which consisted of San Francisco Bay Area, Seattle-Tacoma, Dallas-Fort Worth, San Diego, Phoenix, Indianapolis, Tampa Bay, Baltimore, New York, Philadelphia, Chicago, Washington DC, Orlando, and Atlanta. Amazon's free service is now in 27 major cities and more are likely to come.

    Whether in Roxbury or not, it's clear that Amazon is being relentless in its' pursuit to offering same-day delivery nationwide and other retailers are turning toward offering it also. A Same-Day Courier like A-1 Express is a provider that retailers want to team up with to quickly implement an effective same-day delivery model. The Boston Courier can develop same-day solutions nationwide and generate the market share online that companies are looking for.

    Reference: 4.22.16, www.boston.com, Trefis Team, Adam Vaccaro and Allison Pohle,Amazon offers same-day delivery to every Boston neighborhood, except Roxbury

    Friday
    Apr222016

    Best Buy Begins Testing Same-Day Delivery In 13 More Markets

    It's not a light matter when you as a retailer see continuous Same-Day Delivery expansion by Amazon. If you're a competitor, you must decide to expand as well. A recent report by Forbes discusses how electronics leader Best Buy has announced it will be rolling out testing of same-day delivery in 13 more major metropolitan markets nationwide. The announcement comes shortly after Amazon's official roll out of free same-day delivery in 11 US cities.

    With the consumer electronics having the highest online sales percentage in US retail, as well as eMarketer expects computer and consumer electronics revenue from online retail sales in the US will exceed $85 billion this year, Best Buy is taking an aggressive approach to take on Amazon regarding same-day delivery. This initiative began last year, as the retailer began testing the service in San Francisco and its' surrounding areas, New York and Washington DC.

    Best Buy is partnering with start-up delivery company Deliv, which utilizes a crowd sourcing base approach to fast same-day services. Deliv essentially fulfills online orders via Best Buy stores. It takes a good mix of volume, infrastructure and demographics for the service to be successful. Best Buy has over 400 stores nationwide, and with this type of reach, the retailer can implement same-day delivery on a mass scale where its' locations are.

    The testing expansion into 13 metropolitan city markets is more than likely only the beginning of more to come, especially if it wants to seriously compete with Amazon. In comparison, Amazon is now up to 27 major cities that it provides free same-day delivery, and the year is far from over. EMarketer also stated in the article that revenue from computer and consumer electronics retail sales online will also grow to over $100 billion in 2018, making it the US retail product category with the highest generated revenue. Best Buy may not be done with expanding either.

    One reason is solely based on the holiday season, per a National Retailer Federation survey, consumers said 46% of their holiday shopping in 2015 would be done online. This figure brings into view for Best Buy, Amazon and any other major retailer the vital need to be innovative online more than ever before. The article mentioned Best Buy's same-day delivery is a part of its' ongoing commitment to improve the in-store and online shopping experience. It meets a higher level of convenience demand that online shoppers are looking for, and it indirectly promotes traffic into physical stores.

    Several retailers team up with a Nationwide Courier like A-1 Express to implement same-day delivery throughout the US. The New York Courier has the courier expertise and size to effectively establish delivery solutions in any key major US city. As Amazon and Best Buy go deeper into last-mile deliveries, more and more companies will too.

    Reference: 4.13.16, www.forbes.com, Trefis Team, Same Day Delivery: Best Buy's Plan to Take On Amazon?

    Wednesday
    Apr132016

    Amazon Expands Free Same-Day Delivery to More Cities Nationwide

    If you thought Amazon had delayed in their expansion of Same-Day Delivery, here comes more cities that the retail leader has launched into to further its' apparent nationwide objective. A recent report by Forbes announces that Amazon is adding 11 more major US cities to its' current same-day delivery program. This will brings Amazon's total service area to 27 cities nationwide thus far.

    The new US cities that Amazon is expanding into includes Sacramento, Stockton, Charlotte, Cincinnati, Fresno, Louisville, Milwaukee, Nashville, Raleigh, Richmond, and Tucson. Amazon has strategically selected these cities to go with, which is not solely based on market share. With same-day delivery, there are vital components necessary for the service to be successful, which currently are known only big cities have. The market has to have the right demographics in order to generate profit from volume. Also, big cities have the infrastructure to enable fast last-mile deliveries.

    Amazon already has free same-day delivery in the San Francisco Bay Area, Seattle-Tacoma, Dallas-Fort Worth, San Diego, Indianapolis, New York, Philadelphia, Phoenix, Tampa Bay, Baltimore, Boston, Washington DC, Chicago, Orlando, and Atlanta. It also launched free same-day delivery last year in 14 metropolitan cities the US, starting with California cities. At this rate, Amazon is going to be offering an efficient same-day delivery program nationwide within a few years. More than likely, Amazon will implement same-day delivery in more cities as the holiday season get closer as well.

    The retailer's Prime service is what is making the difference and showing to be the reason same-day delivery is thriving. "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,” said Amazon Vice President of Prime Greg Greeley. “We keep making Prime better, and as our operational capabilities grow, we will continue to invent and expand delivery options that customers love.”

    Prime members will be able to get same-day service free in these cities for the same $35 qualifying order amount as the others. To attract more regular customers to join Prime, Amazon raised its' minimum order size from $35 to $49 to qualify for free two-day shipping. Customers have millions of items at their disposal to order from Amazon. Prime Now is even available for Prime members, in which they can order tens of thousands of essentials and gift items via native mobile apps and have them delivered within two hours, even restaurant deliveries as well.

    For other retailers to compete, they are going to have to engage in same-day delivery to keep up with Amazon. Several e-retailers and physical store chains have opted to partner with a Same-Day Courier like A-1 Express in order to offer same-day services too. The Charlotte Courier has the service footprint, courier expertise and technology to aid any retailer to establish the same-day delivery nationwide.

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

    Thursday
    Apr072016

    More Same-Day Grocery Delivery for Whole Foods

    Grocery delivery services are growing day by day, as customers begin to become more comfortable with having their food products delivered. What adds to the value of grocery delivery is that is provides a high level of convenience. It saves customers time spending at the store, and the gas money it takes to driver there. Whole Foods is a supermarket chain that joined with Instacart in 2014 and found a successful niche in same-day grocery delivery, coupled with its already strong loyal customer base. It made sense to do it then, and it makes sense to expand now.

    Whole Foods has announced it will be expanding its same-day grocery services via the mobile grocery shopping app Instacart. Internet Retailer reported that Whole Foods will be adding an unspecified number of markets in which it will offer same-day grocery delivery, in addition to its current 17 metro areas where the Instacart delivery option is being offered. The grocery retailer appears to be seeking to gain more of the online grocery market share, especially with e-retail based Amazon and Google positioning themselves to turn more fast grocery shoppers their way from physical supermarkets directly.

    AmazonFresh has been at it for a while, especially mid-last year teaming up with the US Postal Service to deliver groceries in San Francisco, as well as 38 various zip codes in the area. It is also available in the companies hometown Seattle, Los Angeles and more. Google Express officially launched Same-Day Delivery of groceries last month, delivering produce, meat, eggs and other perishable goods in parts of San Francisco and Los Angeles also.

    The article also discussed what Whole Foods' pricing is for same-day grocery services. Its' hour-window service cost a $5.99 fee, while its two-hour window service is $3.99. Short window times with the service tend to be fixed, being they're food and perishables, yet, the accuracy of delivery is more critical because it is food. Several supermarket chains that offer the service partner with an expert Same-Day Courier like A-1 Express to perform the actual deliveries. The New York Courier functions at a fast pace and has a national footprint to meet client expansion demand quickly.

    Instacart CEO Apoorva Mehta commented on the successful strides that Whole Foods is making partnering with them. 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.” This shows that Whole Foods is able to create the ominchannels it wants that is results in store food sales.

    With the Instacart mobile app or website, Whole Foods is in big US markets such as Chicago, San Francisco, Boston, Washington, D.C. and more. At the time of the announcement, the new expansion markets include Orange County, California, and Baltimore. Whole Foods has also been reaching out to more customers that are on the go via coupons. Just last month, Whole Foods launched online coupons through Instacart's mobile app as well.

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