Retailers like Amazon, Walmart and Target have figured out that if they get you your online order today, you will probably spend more tomorrow.
From the New York Times: One day in early November, I ordered an emotional support pickle. The image on Amazon showed a green crocheted prolate vegetable, with a pink bow fixed on top and two black button eyes. It held a sign that read, “Emotional Support Pickle: I will always be around to let you know that you are a BIG DILL.”
I wanted it right away. And my wish seemed attainable.
In the past year, if you’ve shopped online from one of the big retailers, you’ve probably noticed new delivery options. You do not have to wait two days or even overnight for your package to arrive. Instead, you can get what you want that very afternoon, between 4 and 8 p.m., if you’d like.
For $6.99, I could get a little emotional support during the busy holiday shopping season, which, for a reporter covering the retail industry, is also the busy season. More important, I wanted to understand how it was possible to order a gag gift in the morning and have it arrive before I went to sleep.
Retailers, which have long competed on price or quality, are now in an all-out race for same-day deliveries. Why? Few people truly need the service; if you are desperate for diapers or a special pasta-making attachment, you’ll go to the store. But companies have found that, once acquired, the taste for speedy delivery makes customers both loyal and willing to spend more money.
“Customers love fast delivery, and the faster we deliver, the more often customers come back,” said Sarah Mathew, a vice president for delivery experience at Amazon. “It doesn’t sound like rocket science, but that was really the aha of ‘Oh, we should really continue to invest here.’”
Amazon set the standard for speed. For years, Amazon’s Prime membership, which now costs $139 a year, came with two-day shipping. Then in April 2019, it announced that next-day delivery would be the new normal. Almost immediately, sales growth picked up steam.
Retailers like Walmart joined the race, and found they had an advantage: physical stores close to doorsteps. Walmart, which last year started offering customers deliveries in as little as 30 minutes, says it can now offer same-day delivery to 86 percent of all U.S. households from its 4,600 stores. In November, Walmart’s chief financial officer said deliveries from stores were up nearly 50 percent from a year earlier and accounted for $2.5 billion in sales in each of the previous 12 consecutive months. Sales on delivered items grew faster than sales in stores.
Target also uses the merchandise in its stores to get same-day orders to customers’ homes. And average shipping times for all orders are nearly a day faster than they were a year ago, Target’s chief operating officer said last month, helped by sortation centers, which rely on products from its stores and Shipt, a delivery service it purchased in 2017.
CLICK HERE to read more.
