Amazon Aims Directly At Walmart+ Competition

Competition is at the core of capitalism. Viable alternatives means service providers will fight for customers by one-upping their competitors when it comes to price or efficiency or both. 

Walmart  (WMT) – Get Free Report and Amazon  (AMZN) – Get Free Report have been locked in a battle for retail supremacy in the U.S. for over a decade now as shopping habits have morphed from purely brick and mortar to more of a hybrid e-commerce model. 

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That competition has led to innovations like same day delivery for packages that used to take days to deliver. 

And now Amazon says Prime has reached a new milestone, delivering more than 1.8 billion items to U.S. Prime members the same or next day so far this year. 

That total is about four times more than the company was able to deliver quickly at this point in 2019 when the company pledged to invest $800 million to make one-day shipping the default for Prime members. 

To achieve this breakthrough, Amazon says it “divided the country into smaller, easier-to-reach regions,” as opposed to its previous strategy of fulfilling orders from any of its operational sites across the country. 

Now the company has eight interconnected regions and 76% of the orders the company delivers come from within the customer’s assigned region. 

“As we make these changes, we are seeing that they have the added benefit of reducing costs, too. Regionalizing our network reduces miles traveled and handoffs,” Amazon said while announcing its accomplishment. 

“Since the beginning of this year alone, the distance between our sites and the customer decreased by 15%, with 12% fewer touchpoints within our middle mile network.”

Amazon ended 2022 with about 168 million Prime members, according to estimates. Walmart meanwhile is believed to have around 30 million members in the Walmart+ program, which launched in 2020.

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