Amazon wants to provide faster delivery to its Prime members
Amazon (AMZN) continues to provide more services under its Prime membership program. According to an April 22 report from The Wall Street Journal that cites the company, Amazon will start providing a service allowing its Prime members to receive package delivery directly to the trunks of their cars. Amazon will launch this service in Germany (EFA) in May, in partnership with car maker Audi and courier company DHL.
This service comes on the heels of Amazon’s announcement that it would provide quicker package delivery to its Prime members. In the past, Amazon has faced criticism over late delivery that relied on package delivery companies such as United Parcel Service (UPS) and FedEx (FDX).
Amazon has now started to experiment with different transportation options to expedite matters. A few months ago, it started testing taxis as delivery vehicles. After that, it even started a one-hour delivery service using bike messengers.
Amazon looks for a competitive edge against retailers
All of this shows that Amazon is getting serious about shipping deliveries as soon as possible. It wants a competitive edge against the immediacy of bricks-and-mortar stores. Physical retailers such as Walmart (WMT) and Target (TGT) still dominate the US retail market despite fast growth in the e-commerce market.
According to a report from eMarketer, and as the chart above shows, e-commerce retail sales as a percentage of total retail sales are at about 6% right now. The mobile commerce market constitutes only about 1% of the overall retail market. So there’s huge growth potential in front of Amazon, and it will want to compete with physical retailers. Faster deliveries are one way to do that.