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Amazon Unveils One-Hour Delivery Service

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Re: Amazon Unveils One-Hour Delivery Service

#31

Post by gdulli »

mooreds wrote: post #24

It's hard for me to see how this doesn't hurt local vendors badly. Of course, it depends on what the the 25,000 items are, but that was one of the key differentiators between Amazon and local stores--if you needed something and you needed it now, the local store was the only option (things like cabling for a new TV, gifts for a party that night, etc). Now, for prime members in NYC at least, Amazon is a viable option.…

Honestly, I like getting out of the house and going to the store. Not every day, I do my share of buying online. But there are plenty of times I'd rather go out and I'm not tempted to sit around and wait to be brought something, even if it could come within the hour.

I often do reverse show-rooming. I'll browse through a real bookstore, which is fun, but I'll look up reviews on mobile and factor that into my buying decisions.

Re: Amazon Unveils One-Hour Delivery Service

#32

Post by free2rhyme214 »

jmathai wrote: post #29
jcr wrote: post #4

Just as Amazon is trying to use 1 hour delivery to compete better against brick-and-mortar companies, Google is trying to help the brick-and-mortar companies compete with Amazon by providing a competing delivery service called "Google Express" (previously called "Google Shopping Express") [1]. It's been mentioned a few times on hn [2,3]. [1] https://www.google.com/shopping/express/ [2] https://news.ycombinator.com/it…

> Google is trying to help the brick-and-mortar companies compete with Amazon I'm not sure that wording is accurate. Google is leveraging the brick-and-mortar companies to compete with Amazon and collect more data about its users. Arguably some of the most valuable data they could get; spending and buying habits. I doubt Target is thrilled that Google is looking to inject themselves as a middleman between them and th…

Exactly. Google isn't trying to help anyone but themselves, that's business 101. Just like Instacart is helping themselves by leveraging Whole Food's inability to delivery groceries to customers.

Re: Amazon Unveils One-Hour Delivery Service

#33

Post by philwelch »

Dirlewanger wrote: post #17

Can't wait to see how awesome the work environment will be for these couriers! Probably much like Uber's drivers: under constant pressure to meet a quota (in this case, probably minimizing the number of missed 1 hour marks), and if you're injured/hit/cause an accident, it's on you and the employer will be nowhere to be found.

Ever ordered a pizza? 1 hour delivery doesn't come close to any kind of realistic safety margin.

Re: Amazon Unveils One-Hour Delivery Service

#34

Post by ics »

mooreds wrote: post #24

It's hard for me to see how this doesn't hurt local vendors badly. Of course, it depends on what the the 25,000 items are, but that was one of the key differentiators between Amazon and local stores--if you needed something and you needed it now, the local store was the only option (things like cabling for a new TV, gifts for a party that night, etc). Now, for prime members in NYC at least, Amazon is a viable option.…

It's a draw on cost too, as Prime prices are sometimes inflated beyond other stores or even the regular retail price.

As for convenience, those without a doorman always think twice before placing orders online.

Re: Amazon Unveils One-Hour Delivery Service

#35

Post by dkrich »

mooreds wrote: post #24

It's hard for me to see how this doesn't hurt local vendors badly. Of course, it depends on what the the 25,000 items are, but that was one of the key differentiators between Amazon and local stores--if you needed something and you needed it now, the local store was the only option (things like cabling for a new TV, gifts for a party that night, etc). Now, for prime members in NYC at least, Amazon is a viable option.…

What does the local store win on?

I think in the long-run, it'll be price.

Sure, in the short-term, Amazon can do what they do and undercut on price, but in the modern age, Wal-Mart has pretty much figured out the optimal model of inventory storage/distribution and the model of keeping inventory on-hand and having customers come to them enables them to do this at an incredibly large scale and at razor-thin margins. Yet they are still margins.

As we have seen before, delivering products at that scale and selection via delivery is extraordinarily challenging to do profitably. Amazon can do a lot of things, but one thing I don't think they will ever be able to do is bring products to peoples' doors at a cheaper price than Wal-Mart can store inventory in large stores and distribute to customers who come to them. There are just too many complexities around the delivery/customer service/quality control processes to make the economics work out.

Re: Amazon Unveils One-Hour Delivery Service

#37

Post by tesseractive »

mooreds wrote: post #24

It's hard for me to see how this doesn't hurt local vendors badly. Of course, it depends on what the the 25,000 items are, but that was one of the key differentiators between Amazon and local stores--if you needed something and you needed it now, the local store was the only option (things like cabling for a new TV, gifts for a party that night, etc). Now, for prime members in NYC at least, Amazon is a viable option.…

It's in no way clear that Amazon wins on selection. In 25K SKUs, Amazon will have electronics, but almost certainly hace fewer SKUs than a dedicated electronics store. They will have groceries, but not as many as a grocery store. They will have clothing and housewares, but surely only a small sampling relative to Macy's.

I shop at Amazon Fresh in Seattle sometimes, and the selection is significantly trimmed relative to pretty much any local grocery store I can walk into. The tradeoff is the convenience of not having to go to the store and spend my time traversing the aisles.

Re: Amazon Unveils One-Hour Delivery Service

#38

Post by Nacraile »

driverdan wrote: post #25
Dirlewanger wrote: post #17

Can't wait to see how awesome the work environment will be for these couriers! Probably much like Uber's drivers: under constant pressure to meet a quota (in this case, probably minimizing the number of missed 1 hour marks), and if you're injured/hit/cause an accident, it's on you and the employer will be nowhere to be found.

If they don't like it they can quit.

We tech folk would do well to remember that relatively few people have the good fortune of working in a labour market where demand outstrips supply. Being able to just quit with a comfortable buffer in the savings account and confidence that a better option is just around the corner is a rare privilege.

In a market where there is an oversupply of labour, a free-market race to the bottom results in significant suffering over a large number of workers while benefitting a small number of the already-wealthy. It is difficult to view this as a socially desirable outcome.

Re: Amazon Unveils One-Hour Delivery Service

#39

Post by saosebastiao »

bengali3 wrote: post #14
shalbert wrote: post #6

How can they get to places within an hour and make a worthwhile margin of profit?

>make a worthwhile margin of profit? If Dominos can do it for pizzas, amazon can do it for much bigger ticket items. PLUS they are not incurring the cost of shipping the item to a prime member. Right now for every physical good prime purchase they spend money on shipping. Also see: Amazon is not worried about short term profit [1] They have probably planned to not profit for a while in exchange for increased cashflow…

Dominos can do it for Pizzas because the profit margin on Pizzas is about as close to 100% as you can get, and delivery-person pay is about as low as you can get, combined with subsidy via tips. A $20 pizza will have a higher total gross margin than a $100 anything-retail.

Amazon is going to lose money on this, and it will probably only ever be feasible (even as a net loss) in a handful of zip codes in the US.

Re: Amazon Unveils One-Hour Delivery Service

#40

Post by tesseractive »

dkrich wrote: post #35
mooreds wrote: post #24

It's hard for me to see how this doesn't hurt local vendors badly. Of course, it depends on what the the 25,000 items are, but that was one of the key differentiators between Amazon and local stores--if you needed something and you needed it now, the local store was the only option (things like cabling for a new TV, gifts for a party that night, etc). Now, for prime members in NYC at least, Amazon is a viable option.…

What does the local store win on? I think in the long-run, it'll be price. Sure, in the short-term, Amazon can do what they do and undercut on price, but in the modern age, Wal-Mart has pretty much figured out the optimal model of inventory storage/distribution and the model of keeping inventory on-hand and having customers come to them enables them to do this at an incredibly large scale and at razor-thin margins. Y…

Another big difference between this and Wal-Mart is geography. Wal-Mart's strongest areas are less-densely-populated rural areas where one store can draw customers from miles around. And indeed -- you can't easily set up a same-day Amazon delivery service in rural America. The distances and low population density make it completely impractical. For the foreseeable future, Amazon will compete with Wal-Mart in these areas using traditional UPS-style delivery and larger selection.

But this is going into New York City. And the flipside is that you can't put a Wal-Mart in the middle of NYC -- it's cost prohibitive. So it's not clear that this initiative even competes with Wal-Mart really. And brick and mortar stores in the middle of an expensive city have huge real estate costs, so it's difficult (though not necessarily impossible) for them to compete on cost the way Wal-Mart does.

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