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Amazon’s Push for 1-Day Shipping (And Why We’re Not Worried About It)

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If you’re in or around eCommerce on a daily basis, you’ve probably already heard about Amazon’s announcement that they are rolling out 1-day shipping for their Prime Members.

It’s where the industry is headed, as Amazon sets the expectation for the eCommerce consumer, and in this case, satisfying that “I want it now craving.” 60 million Amazon Prime members across the United States are also going to enjoy the benefits of next day shipping.

The logistics industry usually follows Amazon’s expectation-setting, and you might think that this new announcement would have logistics companies worried. But at Dotcom Distribution, we’re not too concerned. Here’s why.

According to Dotcom Distribution’s Director of Freight Analytics, there are a few ways to handle the challenge Amazon has thrown down, and in each case Dotcom can meet that challenge.

The first is technology. The Enterprise Level Transit Management system that’s layered into Dotcom’s Warehouse Management system has essentially been managing all forms of carrier and service decisions based on the parameters that our partners decide on. If tomorrow every brand that we work with told us to “turn on 1-day shipping” we’d have a variety of ways to satisfy that demand through the available carrier and service selections.

Another reason we’re not worried is that many of our brands care about managing their shipping cost. Of course they offer expedited shipping services, but their customers often end up choosing the free standard shipping services. When the customer chooses a standard shipping method for no additional cost, they have the expectation that the package won’t arrive in just a day or two. Delivery could take longer than just a day. But considering that packages shipped from Dotcom using even a ground shipping method reach about 80% of the US population in three days, our brand partners – and their customers – find the delivery time from this location fully acceptable.

Much of this has to do with the nature of Dotcom’s typical partners. They’re brands. They are selling an experience. They’re not selling a commoditized product. Many of these brands include some sort experience or specialty packaging that a company like Amazon just can’t incorporate into their processes. In fact, for those partner brands who also have subscriptions, 1-day delivery simply isn’t a concern because they build in the necessary lead time to make meet an expected delivery date.

What this announcement by Amazon indicates is just how fast things change in this world of eCommerce. Smart organizations always keep an eye on industry trends and react by thoughtfully planning solutions. By coincidence, Uber is also getting into freight brokerage. But that’s different than direct to consumer delivery. And it’s not like consumers will soon be sending their self-driving cars to a warehouse to pick up packages while binge watching Game of Thrones.