Amazon will now let its Prime customers in the US nominate an ‘Amazon Day’, a designated day that all their parcels are delivered.
Amazon will group any nominated parcels ordered that week for delivery on the specified day, meaning that Prime customers will be able to ensure they are in for a delivery.
If a customer needs an item before their designated Amazon Day, they can still choose the Prime speedy delivery option.
This is convenient for customers as they avoid the dreaded ‘sorry, we missed you’ slip and great news for Amazon, which saves on fulfilment costs by consolidating multiple deliveries into one weekly drop, and minimises the costly redelivery that occurs when a customer is not at home.
Amazon’s fulfilment costs have shot up as Prime customer numbers have climbed, with fulfilment costing $25.2 billion in 2017, up 43% from 2016.
Cutting down on multiple packages and truck journeys will also help to boost Amazon’s environmental credentials.
Amazon delivery experience vice president Maria Renz says: “Amazon Day adds another level of convenience to the many shipping benefits Prime members already enjoy. Prime members can now choose to get their orders delivered together in fewer boxes whenever possible on the day that works best for them.”
“We’ve been testing this programme with a group of Prime members and Amazon Day has already reduced packaging by tens of thousands of boxes - a number that will only continue to grow now that the programme is available to Prime members nationwide.”
Amazon’s customer-centric fulfilment has been one of the biggest disruptive forces in retail over the past two decades. Could Amazon Day become the new normal across the industry?
“For Amazon, this makes a lot of sense,” says supply chain consultancy Bearing Point director Emile Naus. “Amazon is really playing up the environmental benefits of this and trying to appeal to a specific type of customer.”
With consumer awareness of environmental issues at an all-time high, there could be a big driver for some shoppers to nominate an Amazon Day.
Naus says: “In the UK, Ocado was the first supermarket to tell customers when they were in their area on a delivery round and badged it as being environmentally friendly. That is how you get something to resonate with the consumer. But what it really is, is a huge cost saving.”
On Amazon’s huge fulfilment bill, even a relatively small percentage saving would have a big impact.
So Amazon Day would benefit Amazon. But will it work for the customer?
“I am a big believer in consumers wanting convenience and not speed, though we often get those two things confused,” says Capgemini Invent principal Mark Ruston. “It is a lot more control for the customer. I think it’s pretty compelling.”
The new norm
Ruston believes that it will be a matter of time until Amazon Day arrives in the UK but believes that other retailers may not be able to copy its strategy.
“There’s a huge capacity challenge to overcome,” he says. “Most people will want their deliveries at the weekend. That’s ok for Amazon because when they reach peak capacity they use the gig economy to top up. Other retailers don’t do that.”
What’s more, customers may not shop with other retailers regularly enough to make the proposition feasible.
Naus believes that a nominated day could work if retailers pooled their deliveries, with customers then receiving a delivery from multiple retailers once a week but cautions that this is a long way off as retailers have so far failed to collaborate on fulfilment.
There may be significant barriers for retailers to replicate Amazon Day but there are also significant rewards. With partnerships and collaboration becoming increasingly common across retail, a cross-retail response to Amazon Day may be within reach.