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Amazon Is Expanding Prime Now Service to New Metro Areas

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Jun. 3 2016, Updated 11:06 a.m. ET

Amazon expands Prime Now service to 30 metro areas

Prime Now is a one-hour delivery service that’s available to Amazon’s (AMZN) Prime members. The service has gradually started to become one of Amazon’s most important services, as it gives the company a chance to beat traditional retailers like Best Buy (BBY) or Walmart (WMT) on the immediacy factor. Amazon already beats these retailers in terms of selection and pricing.

Amazon announced last month that it has expanded the Prime Now service to 30 metro areas in countries such as the US, the UK, Italy, and Japan (EWJ). In the last quarter, it added Prime Now service to cities such as Raleigh, Cincinnati, Tampa, Liverpool, and Osaka.

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The same-day delivery market is poised for strong growth

Amazon’s expansion of its Prime Now service clearly aims to leverage the fast-growing same-day delivery market. According to a report from Business Insider Intelligence, and as the chart above shows, this market could grow from $0.62 billion in 2015 to $4.0 billion in 2018 at a compounded annual growth rate of 76%. This fast growth has attracted other players such as Google (GOOG) and UPS (UPS) to this market.

We discussed Google Express in the first part of the series. According to a report from Fortune, UPS invested in same-day delivery startup Deliv early this year.

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