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BLOOMBERG
Amazon.com Inc’s share of online orders spiked in the final days of the holiday shopping season, demonstrating how big investments in delivery speed paid off with procrastinating shoppers looking for a wide selection of products they could get quickly.
Amazon captured 29% of global order volume in the final two weeks before Christmas, up from 21% the week of Thanksgiving and Black Friday, according to Route, a package-tracking app that captured holiday season data from 55 million orders.
“It’s a pretty sharp shift in how consumers shop,” said Michael Yamartino, Route’s chief executive officer. “The top priority in the days leading up to Christmas is on-time delivery, and when Amazon says it will take two days, it only takes two days. It’s a combination of speed and confidence.”
Amazon CEO Andy Jassy has touted speedy delivery as a key competitive advantage, saying shoppers are more inclined to buy something if they get it quickly. The company’s logistics prowess has become increasingly important amid rising competition from such stalwarts as Walmart Inc, as well as Chinese e-commerce upstarts like Temu, Shein and TikTok, which offer steep discounts but can take a week or more to deliver packages.
Amazon in July announced plans to double the number of same-day delivery facilities in the coming years. The company said it reached its fastest-ever delivery speeds in the second quarter of 2023.
Amazon currently operates more than 50 US same-day facilities in the San Francisco Bay Area, Seattle, Miami, Boston and other big metro areas that ship about 200 million packages a year, according to MWPVL International Inc, which monitors the company’s delivery operation.
Amazon’s fastest deliveries mostly benefit members of its Prime subscription program. About 70% of Prime orders in the US arrive within two days, and almost one in four are delivered within a day, according to Consumer Intelligence Research Partners.
Fewer than 15% of orders arrive that quickly for shoppers without Prime subscriptions, the Chicago-based firm said.