Same-Day Delivery Could Cause a Huge Prime Day Headache

Prime Day LogoAmazon’s second-annual Prime Day could be a game-changer for same-day delivery. That’s because Amazon’s Prime Now service has more than doubled from seven metropolitan areas to more than 40 since the first selling holiday was held last year.

And that could be a huge differentiator for Amazon between last year’s Prime Day and this year’s, according to nChannel president and CEO Steve Weber.

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But it could also be a huge headache for Amazon come July 12, said Weber, whose company offers multichannel listing capabilities to merchants and brands who sell on marketplaces such as Amazon.

That’s because towards the end of 2015, Amazon launched a program called Seller Fulfilled Prime, which allows sellers to display the Prime badge on offers they ship directly to the customer. This is something that makes sense for sellers of big ticket items what would be too expensive to ship to an Amazon warehouse just to be fulfilled again.

Despite having to have a nearly-flawless on-time shipment rate on 300 eligible Prime trial orders within 90 days to be eligible to join Seller Fulfilled Prime, Weber said a one-day event like Prime Day could be a back-breaker for sellers of big-ticket merchandise.

“If you look at the local section of Amazon, you see a lot of deals on kitchen appliances,” Weber said. “How will they [the seller] handle the delivery process? Will they be able to offer the same, quick delivery as if it was coming out of an Amazon warehouse?”

Weber said the main reason Amazon would like all its third-party marketplace sellers to use the Fulfillment by Amazon service is to ensure it has complete control of the customer experience. With FBA, Amazon can guarantee inventory levels are accurate, and that the customer receives good tracking information. “What we see is that most of the software local merchants run is not Amazon Prime-ready. It’s not fast or agile enough to support Amazon Prime,” Weber said. “Local merchants could run into wall. Amazon wants to insulate the customer. They aren’t working with the local delivery guy.”

In a press release issued on July 5, Amazon claims that in the U.S., the number of sellers taking part in Prime Day grew by more than 100% year-over-year and the number of deals from small businesses, brand owners, and entrepreneurs in the U.S. grew by more than 100% year-over-year.

Tim Parry is Multichannel Merchant’s Managing Editor, and the lead programmer for Growing Global.

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