A Profitero study showed Target’s online prices were 25% more expensive than Wal-Mart’s, which were just slightly more expensive than prices on Amazon.
The e-retailer wins a U.S. patent for “anticipatory shipping,” figuring out what particular customers are likely to buy before they buy—then positioning those items for quick delivery.
Talk about e-commerce confidence.
Amazon.com Inc. has patented what it calls a “method and system for anticipatory package shipping” that would figure out which products some consumers want to buy before they buy them. The e-retailer would predict those purchases via such data as its customers’ stated preferences, demographic information and the shopping behavior of similar shoppers, according the patent paperwork.
For instance, “a newly released novel in a series may reasonably be predicted to have a similar demand profile across a wide range of products,” Amazon says in the patent filing. Amazon owns a digital gold mine of customer data, including wish lists, product searches and shopping and shipping histories.
Amazon would ship packages to fulfillment centers near such consumers, which would enable the e-retailer to deliver the items quickly once orders are placed. Amazon would fill in the final delivery data—for instance, street addresses and apartment numbers—during the shipping process, the e-retailer says in its paperwork for the patent, approved last month.
And, Amazon says, packages that end up on consumers’ doorsteps via what Amazon also calls “speculative shipping” without a purchase might be considered gifts from the e-retailer, which is No. 1 in the Internet Retailer 2013 Top 500 Guide. The speculative part could include suggesting products already in shipment toward the customer’s area.
“In some cases, the package may be delivered to a potentially-interested customer as a gift rather than incurring the cost of returning or redirecting the package,” Amazon says in the filing. “If a given customer is particularly valued, delivering the package to the given customer as a promotional gift may be used to build goodwill.” The e-retailer says it might offer discounts to such customers on those products rather than absorb the cost of returns or redirects.
Amazon declines comment today about the shipping system. It could bolster the e-retailer’s considerable fulfillment-and-delivery power, which includes an estimated 20 million paid members of the e-retailer’s Prime program, which offers two-day free shipping for $79 per year.
At least one retail analyst was less than impressed today with Amazon’s patent. “It’s not a whole lot different than having a manufacturer create pre-packs for you and deciding what store you want to send it to. Lots of guys have been doing this for a long time,” says Paula Rosenblum, managing partner at research and advisory firm RSR Research LLC. She describes her reaction the system as “meh.”