Amazon.com, Inc. might have to stop priding itself on its fast-delivery system as other retailers build the capacity to get goods to consumers faster. Fortune reports that the largest department store in the U.S., Macy’s Inc. is now going head-to-head with Amazon with an offering of same-day delivery in 17 markets.
Amazon has built a competitive edge with two-day delivery in its Amazon Prime service. Amazon also has a Prime Now service that delivers products within a same-day in select zip codes.
Same day delivery gets goods to the end users within a day and it removes the trip to a store. The fact that you can order and receive a product in about the same time it would take you to go to a store has been one of the reasons Amazon has been a hit in the ecommerce space.
Macy’s Challenge with Same-Day Deliveries
Macy’s is starting with same-day delivery in 17 markets including Atlanta, Boston and Las Vegas and Amazon had better take note. Macy’s is working with a startup called Deliv. Deliv bridges the last mile gap between retailers and buyers as it uses an Uber-styled model. Deliv drivers pick up the package from a store and they drop it off at the shipping address.
Macy’s tested the market for same day delivery last fall and it reports that the response from consumers has been positive. R. B. Harrison, an exec at Macy’s said, “When we piloted same-day delivery in eight markets initially last fall, we learned that our customers appreciate the additional option of having their purchase brought to their home or office in a matter of hours,”
Amazon facing stiffer competition
Amazon same-day delivery service is offered in 14 metro areas; hence, the pressure is on Amazon to catch up with Macy’s speed. Macy’s has more than 900 location in the U.S. from which drivers can up packages from the nearest store to an address. In contrast, Amazon has only 50 distribution centers and it can’t just compete with Macy’s on the network scale.
Amazon now has different battles to fight on many fronts as key players contest its market share in the e-commerce space. Last month, Jet.com started a rival service that wants to compete with Amazon on price.
Jet offers its products at big discounts to Amazon’s and it even shows you how much you save relative to Amazon prices. Back in May, Wal-Mart started a new delivery system that costs less than Amazon Prime at $50 per year. Now, Macy’s is competing with Amazon on delivery speed. Amazon needs to step up its game to stay on top of the competition.