Executive Briefings

PetSmart Goes Same-Day Delivery

PetSmart has become one of the latest companies to offer same-day delivery - a year and a half behind rival Petco with partner Instacart - via partner Deliv. PetSmart.com says the service is now available in California (Los Angeles, Orange County, San Francisco, San Jose), Las Vegas, Atlanta, Miami, Seattle and Chicago. By mid-November, it will be available in eight additional metro areas for a total of nearly 2,500 zip codes serviced.

Other merchants may ask themselves, when does this level of service make sense? For what products and for what type of customer, and in what markets?

There may not be huge demand for same-day delivery, but this is changing - especially among younger, urban consumers with more of an "I want it now" mindset. According to a 2016 holiday survey from Deloitte, millennial shoppers are willing to pay an average of $5.50 per order to get same-day service, compared with $3.80 for all others. In the same survey, 98 percent of millennials consider same-day delivery to be fast shipping, but the response rate drops to 88 percent when it comes to two-day delivery.

As the ever-growing raft of same-day providers - Amazon Prime Now, Google Express, Deliv, UberRUSH - expand to more markets and make the service available to millions of consumers, people are getting more and more used to the idea.

Amazon, for example, offers free same-day delivery service on some items to Prime members and also provides one-hour delivery for $7.99 on thousands of products in more than two dozen U.S. cities. Once again, the company has retailers everywhere scrambling to catch up.

The question is: How much of same-day demand is organic vs. created? Some argue that Amazon has driven much of this as it expands Prime Now, making it more a part of the landscape in urban areas.

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Other merchants may ask themselves, when does this level of service make sense? For what products and for what type of customer, and in what markets?

There may not be huge demand for same-day delivery, but this is changing - especially among younger, urban consumers with more of an "I want it now" mindset. According to a 2016 holiday survey from Deloitte, millennial shoppers are willing to pay an average of $5.50 per order to get same-day service, compared with $3.80 for all others. In the same survey, 98 percent of millennials consider same-day delivery to be fast shipping, but the response rate drops to 88 percent when it comes to two-day delivery.

As the ever-growing raft of same-day providers - Amazon Prime Now, Google Express, Deliv, UberRUSH - expand to more markets and make the service available to millions of consumers, people are getting more and more used to the idea.

Amazon, for example, offers free same-day delivery service on some items to Prime members and also provides one-hour delivery for $7.99 on thousands of products in more than two dozen U.S. cities. Once again, the company has retailers everywhere scrambling to catch up.

The question is: How much of same-day demand is organic vs. created? Some argue that Amazon has driven much of this as it expands Prime Now, making it more a part of the landscape in urban areas.

Read Full Article