Amazon used to be an online company that followed trends. But it morphed into a company that now sets trends. With service like their one-day delivery option, Amazon is going above and beyond to exceed expectations.
This option comes with a downside, though. Any service with this guaranteed speed affects workers, shippers and other businesses. This leads some people to question if the “Amazon effect” has gone too far.
But with almost three-quarters of the U.S. eligible for same-day or next-day delivery, Amazon shows no signs of slowing down. What started as an online bookseller has now become so much more, paving the way for others to follow.
The benefits
The benefits of one-day delivery are up-front and clear, with many praising Amazon’s business incentives and abilities.
1. Customer satisfaction
The first positive outcome of this option is customer satisfaction. Today, customers want what they order immediately. Amazon Prime is there to ensure that speed.
Amazon Prime members receive various benefits, one being faster shipping. This shipping luxury alone led to an increase in subscriptions, with more people signing up in the last quarter in 2019 than ever. Customers want their orders as soon as possible and Prime is now making it a norm.
From a broader perspective, this customer satisfaction increases expectations for shipping in general. When Amazon raises the bar, other companies must follow. Customer expectations will be high for every company, which, in turn, encourages productivity and business for all shippers.
2. Competition and innovation
This productivity boost leads to the second benefit. Competition and innovation will increase because of Amazon. This groundbreaking speed of shipping ensures that other companies must step up their game in order to compete.
Another example of Amazon’s progress is its Amazon Go stores. This is Amazon’s innovative grocery store, but it is more advanced than most. With no cashiers, customers walk out the door with their groceries while their Prime account is charged.
As Amazon constantly steps up its game, other shippers, and now grocery stores, will have to as well. This is the Amazon effect, yet again. Amazon innovates, and the rest of e-commerce follows, which highlights the third benefit.
3. E-commerce and spending
E-commerce has not been the same since Amazon reached its current status. Amazon Prime’s fast shipping not only encourages new customers to sign up and invest in Prime, but it also encourages spending like never before. Whether for better or worse, Amazon influences the U.S. economy like no other company.
Fast delivery makes almost any shipping costs worth it. With Prime, shipping is everything. This e-commerce increase will lead to more investment in transport, shipping and the supply chain.
The drawbacks
Big companies like Amazon tend to find themselves at the center of criticism. The one-day delivery option is no exception.
4. Small business effects
One of the first cons that people point out is the effect this shipping option will have on smaller businesses. While many medium-sized or larger companies may have the resources to compete with (or more likely, simply follow) Amazon, smaller ones may go out of business. With more and more people turning to Amazon for fast delivery, fewer people shop the smaller companies that don’t have the same fast shipping option.
This won’t affect just e-commerce either. One-day shipping will affect local small businesses, too. Since shipping is so immediate, people may not visit nearby shops as frequently.
These smaller companies will then no longer invest in their own shipping and transport if they go out of business.
5. Workplace conditions
Another main drawback that’s been under media and public scrutiny is Amazon’s working conditions. Some of the company’s workers have voiced criticisms in recent years regarding working conditions and pay.
A portion of these concerns come from Amazon’s contract delivery carriers. Shipping as much as Amazon does can be expensive, but paying workers fairly is critical. Carriers explain that working conditions can be dangerous, schedules can exceed 60 hours and their hourly pay is not $15 like listings dictate.
As one-day delivery grows, demand for carriers will, too. Many fear extended schedules or layoffs in the upcoming months and years.
6. Commerce takeover
Lastly, some fear that Amazon is heading towards a gradual takeover of all commerce. Though it may not be fully possible for Amazon to control it all, many believe the company is growing too powerful and influential.
Amazon Air and Prime Air are other ways the company is expanding. Amazon Air’s focus is moving merchandise by aircraft, while Prime Air involves drones and entails an even more instant delivery speed. The company aims to fine-tune these drones to drop off packages in 30 minutes.
Amazon is growing its inventory, offers and market share. While many think this is fine because it “works” for them, others feel that the company is taking away too much business from other companies and gaining too much power. As its customer base and shipping resources grow, Amazon is not going anywhere any time soon.
