Amazon is attempting to outrun the competition by offering even faster shipping for Prime members.
The e-commerce giant is speeding up its two-day shipping—which has already strained retailers struggling to keep up with the buy now, want now consumer sentiment Amazon set the tone for—to just one day.
While Amazon once cornered the market on convenience and accessibility, big box retailers like Walmart and even direct-to-consumer startups are attempting to stake a claim. Free, fast shipping has become a hallmark of the modern era. Though the standard was set by Amazon in 2005, it no longer serves as a differentiator from the growing competition.
So, the retailer has raised the stakes again. Amazon will spend $800 million this quarter to start streamlining shipping and reducing wait times.
Amazon’s chief financial officer Brian T. Olsavsky told analysts after the announcement Thursday, that he expects the company to make quick progress on the new shipping procedure, though it’s unclear whether the transition will be complete by the holidays. The program will for now be offered only in the U.S. No plans have yet been outlined for global expansion.
It is also unclear how the expedited shipping will affect the cost of Prime membership in the future. At this time, Amazon has not indicated that an increase is forthcoming, though Olsavsky told Bloomberg the company has started encouraging subscribers to consolidate their orders, presumably to reduce the number of packages being sent out.
Despite some lingering questions, the hype has taken hold: Amazon stock shot up 2.5 percent to $1,950.63 Friday. Target and Walmart both faltered, the former falling 5.4 percent and the latter, 3 percent.