Will the latest Amazon and DoorDash delivery moves give each a leg up on rivals?

Discussion
Sources: Amazon, DoorDash
Aug 11, 2021

Amazon.com and DoorDash, in two unrelated moves announced last week, plan to improve on their delivery offers, which will likely put more pressure on their respective rivals as the ongoing last mile competition continues on.

Free delivery and fulfillment speed are critical to Amazon’s pitch for Prime members and now those participating in the retail and tech giant’s annual subscription plan will have expanded access to same-day delivery on up to three million products across dozens of categories if they live in Baltimore, Chicago, Detroit, Tampa, Charlotte or Houston. These cities are being added to Amazon’s same-day markets — Philadelphia, Phoenix, Orlando and Dallas, all of which began offering the service last year.

Amazon’s  same-day offer is free for orders of $35 or more. It also enables Prime members who place orders before midnight to get delivery on applicable items by 8:00 a.m. the next morning. It credits the creation of mini fulfillment centers staffed by locals as the key to the quick turnaround on same-day orders.

The company is also touting the service as better for the environment. Amazon has said that it is able to cut carbon emissions by locating its new fulfillment centers closer to the customers receiving deliveries.

DoorDash announced last week the debut of DoubleDash, a new program through which customers of the online delivery service can place restaurant orders and then have items from other businesses picked up along the way at no additional cost.

Participating partners in the program include 7-Eleven, Walgreens, Wawa, QuickChek and The Ice Cream Shop. Dashmart, DoorDash’s own store offering thousands of convenience and grocery items, is also a source for add-on products. The company also said it is testing a program that offers members special deals when they place orders with more than one restaurant at a time. DoorDash is introducing the service in the U.S. and Canada.

DoubleDash is being promoted by DoorDash as “the next step toward getting everything you want from your neighborhood delivered together in a one-stop shop experience.”

DISCUSSION QUESTIONS: Do you see demand for home deliveries picking up during the fall and winter months? What will the latest delivery program updates mean for Amazon, DoorDash and their rivals?

Please practice The RetailWire Golden Rule when submitting your comments.
Braintrust
"These new programs by Amazon and DoorDash throw down the gauntlet for their competition to pick up and accept the challenge."
"What flummoxes me is where the marketing should lie: should it be promoted only by the retailer?"
"There is no possible win for either company by ensuring they lose more money on last-mile delivery."

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11 Comments on "Will the latest Amazon and DoorDash delivery moves give each a leg up on rivals?"


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David Naumann
BrainTrust

During the worst times of COVID-19, many consumers turned to delivery services and now appreciate the convenience. The last mile of delivery is the most costly and competitive from a delivery time perspective. The companies that continue to raise the bar on delivery times and value added services, like Amazon and DoorDash, will definitely have an advantage over the competition.

Bob Amster
BrainTrust

One would think that during the winter months, for sure, demand for home delivery would go up in those regions of the country in which ice and snow are a factor. These new programs by Amazon and DoorDash throw down the gauntlet for their competition to pick up and accept the challenge.

Melissa Minkow
BrainTrust

Demand for home deliveries and for same-day delivery will pick up as we face new COVID-19 surges, cold weather, and set our expectations to speedier delivery options. If Amazon is going to once again set the bar here, though, they better be prepared to accommodate the demand. Relying on local warehouses means they’ll have to ensure they have the local staff in place to support this.

DoorDash’s approach is clever in that it simulates the in-person, convenient experience of hopping from store to store. This is a smart solution for getting digital to feel as efficient and convenient as in-person does still for so many shoppers’ preferences.

Ken Morris
BrainTrust

I see demand substantially increasing this fall and winter as COVID-19 or fear of COVID-19 continues. It just hastens the move to online shopping for basics. The technology battle is heating up with robotic pick, pack and ship or pick-up with rivals to Amazon and DoorDash gaining ground. Amazon is crediting its mini fulfillment centers with enabling the faster delivery times, and that’s essentially without the robotics of true MFCs. I still believe in the store as a stage, so for non-basic items there will be in-store growth.

DoorDash is smart to add services with additional non-restaurant pick-ups, but that will be a logistics challenge trying to deliver hot food with extra hops along the route.

Christine Russo
BrainTrust

Wow – well there is definitely a war on there. With massive recent investments other delivery players are not retreating and are entering the fray: Getir, Jokr, and GoPuff are looking for dominance. Capitalizing on dark spaces to then accommodate micro-fulfillment center is at the heart of this surge. What flummoxes me is where the marketing should lie: should it be promoted only by the retailer? Are the delivery companies — even DoorDash — responsible to market the service?

Andrew Blatherwick
BrainTrust

On Monday of this week we read that all online companies and retailers in general were struggling to find warehouse operatives, store staff and drivers. Now Amazon and DoorDash create an even more onerous delivery promise to their customers. At what point will the marketing team listen to the pressure the operators are under and come up with other ideas instead of the lazy and easy picking option of ever faster delivery?

Shep Hyken
BrainTrust

Simply put, customers love convenience. Our research indicates that more than 60 percent of customers will pay for convenience, and even more if the convenience includes delivery. COVID-19 showed consumers who had never thought about delivery just how convenient it can be.

Amazon is the leader in delivery. Others, including DoorDash, are continuing to evolve and are forcing others to innovate and improve their offerings. This is all good for the customer.

Jeff Sward
BrainTrust

DoubleDash has to be one of the smartest moves I have seen in this whole delivery conversation. Take the built in fixed cost of any given meal delivery and bolt on added revenue and margin. Amazing what a little planning ahead can accomplish. It’s a triple win. Customer, retailer, environment.

Ananda Chakravarty
BrainTrust
There is a normal seasonal increase in e-commerce during winter months – due to holiday gift giving, end-of-year selling and customers staying at home during inclement weather. I am not seeing much more than this from the Amazon move- primarily because access to 3 million products is such a tiny portion of the 353 million SKUs that Amazon and its partners typically sell – less than 1 percent. As a customer I won’t be seeing same-day delivery on most of my purchases and, even if I do, buying multiple products probably won’t be fulfilled within the same day. A lot of single item deliveries can be an annoyance. However it is a gauntlet being thrown down for the specific cities Amazon is launching into. When it gets to NY, LA, and Chicago with higher SKU counts we’ll see whether Amazon can sustain the frenzy. DoorDash has a different model, and the premium paid by in-service shoppers is more realistic across any product set purchased. Their consumer impact will be higher at a higher cost –… Read more »
Doug Garnett
BrainTrust

The delivery arms race is rapidly closing into where the Cold War arms race might have gone: Mutually Assured Destruction.

There is no possible win for either company by ensuring they lose more money on last-mile delivery. All the customers to be turned by delivery extremes have been turned and the only possible outcome can be more red ink.

Paula Rosenblum
BrainTrust

I like the DoorDash announcement better. Under the covers, Amazon is just replacing “Prime Now” which I already heard someone grumbling about last night.

UberEats will also do grocery delivery now.

I think this is going to be an interesting battle.

wpDiscuz
Braintrust
"These new programs by Amazon and DoorDash throw down the gauntlet for their competition to pick up and accept the challenge."
"What flummoxes me is where the marketing should lie: should it be promoted only by the retailer?"
"There is no possible win for either company by ensuring they lose more money on last-mile delivery."

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