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?

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

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

Amazon Increases Minimum Order Amount for Free Delivery

Amazon is doing a lot of daring moves when is comes to revolutionizing the world of online retail. It doesn't take a genius to know that Amazon is after it all, and is desiring to become the leader in not only on the retail front, but on the delivery and order fulfillment front also. Yet, the latest shift by the retailer for minimum online purchases in order to get free delivery could have a mixed response from Prime members.

The Wall Street Journal discussed the recent announcement by Amazon entails raising its' minimum order size for non-Prime members from $35 to $49 to qualify for free shipping. For at least a decade, Amazon's minimum fee was $25 until 2013, which the retailer increased the amount to $35. The threshold increase could be used to steer regular customers into becoming Prime members, which pay an annual $99 fee and receive unlimited two-day shipping.

In response to the fee hike, Amazon didn’t offer much of an explanation, yet only stated that “from time to time, we review our shipping options.” With it still being early in the year, the retailer could be testing the non-Prime customer market to see how many will become Prime members. There is plenty of time prior to the last quarter for the holiday season to offer the right shipping options to retain Prime members and gain more. The question is how will customers respond to it.

Free shipping isn't the only option that Amazon is offering that is attracting shoppers. In recent years, the company has implemented Same-Day Delivery in a number of major US cities nationwide. Amazon has a stronger presence of same-day delivery more than it ever has before. Amazon provides same-day delivery in the San Francisco Bay Area, Seattle-Tacoma, Dallas-Fort Worth, San Diego, Indianapolis, New York, Philadelphia, Phoenix, Washington DC, Tampa Bay, Baltimore, Boston, and Atlanta. It also launched free same-day delivery last year in 14 metropolitan cities the US, starting with California cities.

Even abroad, Amazon is affirming its goal to expand its delivery capabilities. It is being reported that Amazon is planning to develop a global delivery network to compete in China. Online retail is growing in the US, yet it is climbing at an even faster pace there. E-commerce is forecasted to reach $1 trillion by 2020 in China, which is all the more reason why Amazon is establishing its' fees relative to minimum orders and delivery systems. In addition, Amazon has leading China online retailer Alibaba to wrestle with in that market as well.

The largest US e-retailer has done a host of business implementations to capitalize on its momentum online. With Amazon's price shift, other retailers will probably analyze their own minimum order amounts and shipping options. A number of businesses and retailers have partnered with a Same-Day Courier like A-1 Express to create a delivery solution that will satisfy the need for fast delivery that shoppers demand also. The Los Angeles Courier can assist companies with fulfilling those orders, as the products per order increases, along with the minimum fee for free delivery.

Reference: 2.22.16, www.wsj.com, Greg Bensinger, Amazon Boosts Free-Shipping Minimum to $49, Elevating Prime Service

Nordstrom Shifts To More Online Selling, Same-Day Delivery Could Boost Sales

It takes a lot of e-commerce strength to take your online sales to a high level in today's market, especially with the way Amazon is spearheading many new business trends. Macy's is another retailer that has boosted online sales with Same-Day Delivery, as well as online order store pick up. Nordstrom has made several strategic moves to increase online sales; however, its' shares fell 30% last year, which tells the company it may be time to make a pivotal shift once more. From a recent article from Internet Retailer via Bloomberg News, the shift will have to do with online selling.

Chief financial officer Mike Koppel explained in the article what is hurting Nordstrom's bottom line. It has to do with the entire retail industry turning from running fleets of bricks-and-mortar stores to also selling their goods online. The article said, "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."

One benefit of online sales is that it comes with low fixed costs, but the price tag was high variable cost. His conclusion is that the more Nordstrom sells online, the more it has to shell out to pick, pack and deliver those goods. In his own words, Koppel stated as a result "business has been flattening in malls and growing in e-commerce, and so the two strong trends are impacting operating margins". It appears that Luxury retailer Michael Kors is having a similar issue, even mentioning in the article that e-commerce isn't as profitable as business at physical stores. Koppel said if there is "anyone out there" who has figured it out, because "we have a lot of work to do."

Nordstrom raised its' promotions in order to try and keep pace with Amazon. The robust e-retailer is making strides within the online retail industry that is puzzling a number of retailers on how they can compete. Amazon even has implemented same-day delivery in a number of major US cities nationwide. It provides same-day delivery in the San Francisco Bay Area, Seattle-Tacoma, Dallas-Fort Worth, San Diego, Indianapolis, New York, Philadelphia, Phoenix, Washington DC, Tampa Bay, Baltimore, Boston, 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 as well.

To attract more customers and to establish a deeper loyalty with current Prime members, Amazon raised its' minimum order size for non-Prime members from $35 to $49 to qualify for free shipping. This threshold increase could be used to steer customers into becoming Prime members, which pay an annual $99 fee and receive unlimited two-day shipping. This is just one example of what innovative direction Nordstrom may have to go in to thrive online.

With the growth of same-day delivery in the US, partnering with a Same-Day Courier like A-1 Express may be the move to make for Nordstrom. The service will attract luxury apparel customers via more shopping convenience. The Chicago Courier has all the right delivery technology and courier expertise to compete online.

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