Amazon to Make One-Day Shipping Free for All Prime Members
Amazon reported better than expected Q1 earnings today, seeing revenue of $59.7 billion USD, up 17% year-on-year, to go with net profit of $3.6 billion USD, more than double the $1.6 billion in the same period from 2018. Holy gangbusters, is that a lot of money.
As part of its plan to make Prime even better, Amazon announced it plans to spend $800 million US in the second quarter to make free one-day shipping replace two-day shipping, first starting in North America, then eventually globally.
Amazon Chief Financial Officer Brian Olsavsky made the announcement via the company’s earnings call.
“We’re currently working on evolving our prime free two-day shipping program to be a free one-day shipping program,” said Olsavsky. As per CNBC:
Amazon already offers one-day and two-hour shipping to Prime members for certain products and at an additional cost. But the change would significantly expand the number of product selection and zip codes eligible for one-day free shipping, Olsavsky said. Amazon says over 100 million items are currently available for free two-day shipping on its site.
The change will first take place in the North American market, Olsavsky noted, but is designed to expand globally, across all countries that offer Prime memberships. Amazon said last year that it has over 100 million Prime members worldwide.
Sounds like free one-day Prime shipping as the default will begin in the U.S., then eventually make its way to Canada and beyond. The move looks to counter any new home delivery options from the online retailer’s traditional brick and mortar rivals, and ensure Prime members continue to remain subscribers.
No timeline was made for the rollout of one-day shipping as default, but the announcement will surely make existing members feel good about being a Prime member.