After doing an earlier post regarding Amazon’s new Kindle Fire, I was surprised and excited that Amazon has decided to once again diversify their services. Recently, in Toronto and Vancouver, Amazon has “[raised] the ante in Canada’s e-commerce battle by offering same day shipping” starting at $6.99 per delivery.
Amazon’s same day shipping is a respectful strategy that may give them a successful run in Canada.
Amazon is already dominating the online shopping channel, yet Amazon has decided to take another risk with this new service. Amazon faces competition from leading retail stores, such as Walmart, that offers free same day shipping services, yet Amazon is confident in this new initiative; as Alexander Gagnon, the country manager, states “[it’s] all about convenience.” Amazon realizes that a major pain for customers is the long delivery times and customers are usually in a hurry to acquire their products; Amazon hopes to relieve this pain. Same-day shipping is a very common service in the United States, however, in Canada it is still a rare commodity and usually much more costly than $6.99. By keeping the service limited in Toronto and Vancouver, Amazon can effectively control a lower cost, due to a limited delivery frontier, while avoiding large scale competition. Amazon has strategically decided to develop this service in Canada, since it is a relatively fresh market. By adding yet another value proposition, Amazon seems to have a reliable future in their Canadian market.
http://www.theglobeandmail.com/report-on-business/international-business/amazonca-raises-stakes-in-same-day-delivery-service/article21448160/
http://www.amazon.com/b?ie=UTF8&node=8729023011