By Glenn Taylor, Associate Editor
Amazon’s recent expansion of its same-day delivery service to 11 more U.S. cities has created another big set of consumers who now have access to near-instant gratification.. With Prime Now same-day delivery now accessible in 27 metropolitan areas, Amazon’s big box competitors are under increasing pressure to bring their own fast delivery moves to the table.
Both Kohl’s and Best Buy partnered with courier service Deliv to pilot same-day delivery services last fall, and are presently expanding to newer markets nationwide, indicating that both retailers are going full throttle in transitioning from testing to full-scale deployment.
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While the effort is clearly there, price points at this stage are still not truly competitive with Amazon. For frequent online shoppers, Amazon Prime’s $99 annual cost is likely to prove more cost-effective than the per-order price structure of other retailers. Kohl’s charges $14.95 for individual purchases up to $75; Best Buy hasn’t given an official price, but expects delivery to vary with an “average cost of $10 to $20 per order.”
I do applaud these retailers’ efforts to bring same-day delivery into their offerings, as it shows the brands are willing to experiment and improve on numerous parts of the shopping experience. But if they’re looking to play the catch-up game with Amazon, delivery may not be the hill retailers want to die on.
For one thing, consumers still appear to value cheaper shipping options over faster ones. Deloitte’s 2015 Holiday Survey indicates that the average consumer would pay an extra $5.10 for same-day delivery, with 24% of shoppers expecting to pay no additional charge for the service. Even as demand has increased and more retailers have followed suit, only 29% of U.S. online shoppers have actually shown interest in guaranteed same-day delivery, according to data from Forrester Research.
If these retailers are going to step up their game to bolster their customer experiences, they would do well to look elsewhere — at least for now. Here are some steps retailers can take to polish their presence, without over-spending on same-day delivery capabilities:
Focus on private label: While Amazon rolled out its own private label fashion items two months ago, the eTailer hasn’t yet promoted the new brands in any significant way. Whether they offer apparel, furnishings or even electronics (think Apple), many retailers already have a head start on Amazon when it comes to selling and manufacturing their own private label products.
Leverage the store to influence online purchases: Currently, Amazon’s store presence is still limited to the bookstore locations it opened earlier this year, so they don’t yet have the advantage of being able to promote their brand and products in a physical setting. Don’t forget: same-day delivery isn’t the only omnichannel fulfillment option that consumers may be interested in: buy online/pick up in-store and ship-from-store are still options that give consumers convenient choices.
Prioritize your brand experience to establish an identity: Identity still matters. While Amazon’s personalization module has worked wonders for the brand and its customer service has been lauded, they’re surely not the only company capable of bringing in knowledgeable representatives that embody the brand. If the Best Buys and Kohl’s of the world start dedicating their focus purely on the brand experience, whether online, via a mobile device or in a store aisle interaction with an associate, it will make a more positive long-term impression than the momentary thrill of receiving a package three hours after clicking the “buy” button.
