Amazon job posts hint at global ambitions for same-day delivery

[December 11, 2014]  By Deepa Seetharaman
 
 SAN FRANCISCO (Reuters) - Amazon.com Inc is considering expanding its same-day delivery program globally, recent job listings show, underlining the importance of fast shipping to its ability to compete with the instant gratification offered by brick-and-mortar stores.

The No. 1 U.S. online retailer is also looking to add a same-day delivery option on all items sold by third-party merchants on its site, a move that some logistics experts said may help offset the high costs of speedy, last-mile delivery.

The company's global ambitions for same-day delivery were echoed in at least seven listings for senior product and marketing jobs based at the company's headquarters in Seattle, including three posted online this week.

"Our long-term vision is that customers can order and receive a sellers' product the same day anywhere in the world," according to one job listing posted in late October.

It is not clear when Amazon hopes to meet its goals and how it would extend same-day delivery to more third-party sellers, who account for 40 percent of items sold on Amazon's website and pay fees between 8 percent and 20 percent in most categories.

An Amazon spokesman declined to comment.

Amazon offers same-day delivery in just over a dozen U.S. cities, charging $5.99 for members of its Prime program while non-members pay $8.99. In October, the company launched a same-day delivery service in the United Kingdom with newspaper delivery company Connect Group PLC.

A senior product manager role advertised on Tuesday called for a candidate to shape the future of same-day delivery and "drive large worldwide projects with huge customer-facing and financial impact."

Offering fast shipping is a key piece of Amazon's strategy to compete with brick-and-mortar stores. But the effort is costly - during the first nine months of 2014, Amazon's shipping costs were more than double its shipping revenue.

Some rivals, including eBay Inc, have pared back their same-day projects citing still-unproven consumer demand. Amazon also faces competition from Google Inc, which expanded its same-day delivery service this year, as well as on-demand delivery startups such as Postmates and Instacart.

But the potential payoff could be big, analysts say. According to a September survey by RBC Capital Markets, just 4 percent of Amazon customers used same-day delivery, but they spent 15 percent more than others.

Getting more third-party sellers to offer same-day delivery could help Amazon offset the high costs of offering fast shipping and building warehouses near large urban markets, says Jarrett Streebin, CEO of shipping startup EasyPost.

"The more volume these centers are doing, the better," Streebin said.

(Editing by Stephen Coates)

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