Technology
Monday, April 29th, 2024 2:47 pm EDT
Key Points
- Amazon is increasing its focus on delivering packages to customers within one day or sooner, a metric it is promoting amid heightened competition in online shopping.
- Nearly 60% of orders placed through Amazon Prime in the top 60 U.S. metro areas during the first quarter arrived the same or next day, up from roughly 50% in the second quarter of 2023.
- The company’s efforts to enhance speedy delivery, driven by cost-cutting measures, cloud-computing demand, and faster fulfillment, are expected to be of significant interest to investors as Amazon prepares to report its first-quarter earnings.
Amazon is intensifying its efforts to deliver packages even faster to customers, emphasizing this metric amidst heightened competition in online shopping. The e-commerce giant announced that nearly 60% of orders made through its Prime service in the top 60 U.S. metro areas during the first quarter were delivered the same day or next day, a significant increase from around 50% in the second quarter of 2023. This focus on speedy delivery is expected to be a key point of interest for investors as Amazon prepares to report its first-quarter earnings. Wall Street anticipates another quarter of double-digit revenue growth and a more than doubling of profits compared to the previous year, driven by cost-cutting measures, increased demand for cloud computing, and enhanced fulfillment capabilities. Amazon’s Prime subscription service, which includes benefits like two-day shipping and video streaming for an annual fee of $139, places a strong emphasis on fast delivery, aiming to make same-day and next-day delivery the norm. CEO Andy Jassy highlighted the correlation between faster delivery and increased customer loyalty and frequency of purchases. To support this initiative, Amazon plans to double the number of same-day delivery facilities in the U.S. within the next few years. These facilities, which are approximately 100,000 square feet in size, are strategically located near major metropolitan areas and stock a curated selection of top-selling items. By consolidating the fulfillment process under one roof, these facilities streamline operations and reduce costs per shipment, ultimately enabling faster delivery times. Amazon’s investment in expedited shipping comes as competitors like Walmart and Target ramp up their own delivery capabilities. Walmart boasts delivery times as short as 30 minutes, while Target recently introduced a new loyalty program offering same-day delivery on eligible orders over $35 in as little as one hour. As the battle for speedier delivery heats up in the retail sector, Amazon remains committed to maintaining its position as a leader in customer convenience and satisfaction.
For the full original article on CNBC, please click here: https://www.cnbc.com/2024/04/29/amazon-says-60percent-of-prime-orders-are-arriving-same-day-or-next-day.html
