E-commerce sales have exploded in recent years and have grown exponentially with consumers’ widespread adoption of smartphones and tablets. Online shopping is a 24/7 global enterprise and has become easier with the increased usage of mobile and mobile shopping apps with convenient digital payment systems such as PayPal enhancing the consumer experience.
- Retailers are in the early stages of mobile transition, and customers on multiple devices(phone, tablet, computer, TV) spend significantly more.
- eBay Inc (NASDAQ:EBAY) will do over $20 billion in mobile payment volume in 2013.
- If consumers do not close a transaction online, they are still doing searches or checking prices as the mobile device is becoming the central device of people’s lives.
- eBay Inc (NASDAQ:EBAY) will use buyer data to enrich user experience by engaging in social media such as referencing what friends are buying.
eBay Inc (NASDAQ:EBAY) Now is one of eBay’s initiatives that will take advantage of the growing consumer trends towards mobile, aimed at shortening same day delivery time to its customers.
What is eBay Now?
eBay Now is a local shopping service from eBay, powered by a mobile application only on Apple Inc. (NASDAQ:AAPL)’s iOS platform. Currently, eBay Now is only available in San Francisco, San Jose, and in New York City’s Manhattan. A customer can order from local retailers, which include big names such as Target Corporation (NYSE:TGT), The Home Depot, Inc. (NYSE:HD), Macy’s, Inc. (NYSE:M), Walgreen Company (NYSE:WAG), Best Buy Co., Inc. (NYSE:BBY), and RadioShack Corporation (NYSE:RSH). The eBay Now delivery charge is $5.
How does eBay Now work?
A customer logs into the eBay Now application on his/her iPhone or iPad (not yet available on Android systems), and fills an online shopping cart with the available local items from local stores that are participating in eBay Now. The completed order gets assigned to an eBay “valet” who travels to the retailers to initiate the purchasing transaction. The eBay valets can deliver to the customer anywhere within eBay Now’s local range — to home, to the office, or even to a local coffee shop like Starbucks; anywhere a customer can be setup for the day to receive the items.
The eBay valet may show up with the purchase items by bicycle or automobile, depending on the size and quantity of the goods. The customer will pay the valet with a credit card swiped via a Paypal reader. eBay Now orders can be delivered in about an hour, as stated on the eBay Now website (delivery times are dependent on proximity to the store, traffic, or the size of the order). A customer could easily sit at a Starbucks for an hour, waiting for a hand delivered order from Target, nursing a coffee while browsing a Twitter news feed on his/her iPhone.
What are competitors doing?
Other companies are also wooing consumers for a bite in the same day delivery space. Google Inc (NASDAQ:GOOG) recently launched Google Inc (NASDAQ:GOOG) Shopping Express in March which is currently being piloted in the San Francisco area. Target Corporation (NYSE:TGT), The Home Depot, Inc. (NYSE:HD), and American Eagle Outfitters (NYSE:AEO) are some of the big retailers participating as well as some local stores such as Blue Bottle Coffee. Google is in beta-testing mode with this service, and is looking for test customers. To sweeten the deal for testers, the service is free for six months.
Amazon.com, Inc. (NASDAQ:AMZN) has long been entrenched in the same day delivery business with their Local Express Delivery option since 2009. The service charge is more expensive than eBay Now, as Amazon.com, Inc. (NASDAQ:AMZN)charges $8.99, with an additional charge of $0.99 per item. The service is available in 10 cities, but the customer must order early to beat the mid-morning deadline to give warehouse personnel adequate time to process orders, load delivery trucks, and travel to the order destination.
Wal-Mart Stores, Inc. (NYSE:WMT) has created “Wal-MartToGo” to directly compete with Amazon.com, Inc. (NASDAQ:AMZN). It is a same day delivery service available only in a few cities. The service charge is $10, with no minimum order required. Inventory is dependent on what is available in the participating local Amazon.com, Inc. (NASDAQ:AMZN) stores, and the final order is delivered by the United Parcel Service, Inc. (NYSE:UPS).
Conclusion
eBay has upped the ante in the same day delivery battle. eBay is dedicating investments and resources to take advantage of the increasing trends of online shopping on iPhones and iPads. Amazon has long been the dominant player in the same day delivery battle, but eBay is well positioned to take away some market share with eBay Now, which is aligned to the company’s aggressive mobile strategy.
The article Accelerating Same Day Delivery With eBay Now originally appeared on Fool.com and is written by Sergio Balatan.
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