Same-day delivery is in the nascent stages in the U.S., but physical retailers from Wal-Mart to Nordstrom, as well as e-commerce sites Amazon, eBay, Google and Postmates, are in various stages of testing the service.
The reason for same-day delivery is clear: immediate gratification. It’s the leg up brick-and-mortar retailers have over e-commerce. “This highlights one of their key competitive edges,” said Matthew Nemer, a retail analyst at Wells Fargo. While Amazon’s delivery model utilizes its distribution centers, Nemer said, “The model of products being delivered from the store to the home is the better model. The only way to make the same-day delivery model work is if there’s a store. If you pick up from the retail store, it’s always going to be closer to home. This will be an incremental way to utilize the store and a tool for retailers to fight Amazon.”
Same-day delivery has relatively low consumer adoption rates — 7 percent, according to Shop.org. Nemer, who wrote a research note about same-day delivery, “Battle of the Couriers,” test-drove the various services.
Nemer sampled Wal-Mart To Go and Google Shopping Express, which are still in the beta phase. EBay Now is operating only in San Francisco, San Jose and New York; Instacart is available in the Bay Area, and Postmates is serving San Francisco and Seattle. Start-up Shutl operates in 70 towns in the U.K. and is planning to launch in 19 U.S. cities by the end of 2013. “As Amazon expands its fulfillment network, we expect it to continue to refine and expand its Local Express Delivery program, which is available in 10 cities, though not in the Bay Area,” Nemer said. RELATED STORY: Amazon Launching Men's Prestige Site >>
Despite the lack of interest from consumers, Nemer believes new models could break down resistance. “Same-day shipping provides offer a good experience, and further innovation will likely drive adoption for customers with above-average income in medium-sized cities and urban markets,” said Nemer. “It’s not a panacea for traditional retail, but it does bridge the competitive gap with Amazon Prime and could drive higher average order values.”
For the economics of same-day delivery to work, there needs to be a third-party player who aggregates it. For example, a third-party courier could be aggregating orders from Wal-Mart, Macy’s and Nordstrom.
“I don’t think the single retail model is going to be successful,” Nemer said. “[Third party] is an expensive model, but that will change as adoption rates go up. Shutl works because it’s using an existing courier network so it doesn’t have to hire its own people. Also, the couriers are doing multiple things at the same time, delivering something from Wal-Mart and picking something up to be returned to Bed Bath & Beyond. Shutl will be listed in the retailer’s checkout along with other shipping options.”
In terms of how much consumers are willing to pay for convenience, Shutl found that 5 percent of the order value is the sweet spot.
As one of the most recognizable models in the world, Christy Turlington Burns has an insider’s view of the fashion industry and the allegations of sexual harassment swirling around it. “I can say that harassment and mistreatment have always been widely known and tolerated in the industry. The industry is surrounded by predators who thrive on the constant rejection and loneliness so many of us have experiences at some point in our careers,” Turlington told WWD, along with her suggestions for how the modeling world should protect younger women and men. Read more on WWD.com. Link in bio. (📷: Tony Palmieri) #wwdnews
@asics America has tapped a new brand ambassador: famed DJ/record producer @steveaoki. This initiative is intended to set the tone for the new brand identity and philosophy and will include partnerships with influencers and in-store and off-line activations that will continue into next year. This is Asics’ most significant marketing effort in two decades, and is expected to attract younger consumers to the brand. #wwdfashion
24-year-old Jean Prounis is redefining the rules of jewelry. Formerly a studio assistant to Jemima Kirke and a design apprentice at Ghuran, she focuses on handcrafted subtleties and ancient goldsmithing techniques. “There was a really sterile feel in the environment and I wanted to have jewelry with character that shapes how you wear it everyday,” Prounis said. Each piece is hand made in New York, either by Prounis or three other jewelers in the district. #wwdfashion
“These collections continue to build on that vision, empowering differently abled adults to express themselves through fashion,” said @tommyhilfiger of his line of adaptive apparel, which launches today. The line consists of 37 men’s and 34 women’s styles based upon the pieces from the spring Tommy Hilfiger sportswear collection. #wwdnews
“Stranger Things” is getting a new cast member for season 2. Meet @sadiesink_, the 15-year-old who will be joining the Netflix series for its new season. You may recognize her from “The Glass Castle” with Brie Larson and Woody Harrelson, but the Texas native’s next role goes in an entirely different direction. She describes her character, Max, as “a rough and tumble skater girl [who] becomes friends with the boys at school.” The second season debuts on October 27. (📷: @jgreenery) #wwdeye
Amid the Harvey Weinstein controversy, there’s another sector that’s being put under the spotlight for sexual abuse: the modeling industry. While rumors about abuse and sexual harassment of female and male models — and the photographers, agents and others who perpetrated it — have circulated within the fashion world for years, model @cameronrussell started posting stories from models on Instagram last week about abusive situations they’ve encountered — from sexual harassment and molestation to attempted rape. Over 75 have weighed in so far. Read more on WWD.com. Link in bio. #wwdnews
To celebrate its 16th anniversary, @dylanscandybar tapped designers and celebrities to create mosaics out of candy. The mosaics will be auctioned off to support the philanthropic cause of each participant’s choice. Pictured here is the mural created by @aliceandolivia's Stacey Bendet. For a first look at some of the other artwork being unveiled tonight, go to WWD.com. #wwdeye
The annual Veuve Clicquot Polo Classic in Pacific Palisades this weekend drew Kate Hudson, Tracee Ellis Ross, Laura Dern and more. See pictures of the star-studded event on WWD.com. (📷: @chelsealaurenla) #wwdeye
In his new book “Hollywood Royale,” Andy Warhol’s Protégé Matthew Rolston celebrates the Eighties revival of Hollywood glamour. Featuring more than 100 portraits taken by Rolston from 1977 to 1993, the book contains photos of icons like Michael Jackson, Cyndi Lauper, and @drewbarrymore, pictured here in 1991. “Hollywood Royale,” out today, will be accompanied by an exhibition opening at Los Angeles’ Fahey/Klein Gallery on March 1. #wwdeye