Amazon one-day shipping for Prime members increases spend, loyalty

on Jun21
by | Comments Off on Amazon one-day shipping for Prime members increases spend, loyalty |

An Amazon Prime package 

Andrew Harrer | Bloomberg | Contributor

Amazon shoppers that get same-day delivery are likely to spend and shop more on the e-commerce site compared to non-same-day delivery users, according to a recent survey by investment firm RBC Capital.

The survey data shows why Amazon is heavily investing in shortening delivery time. In April, the company announced that it would spend $800 million this quarter alone to make one-day free shipping the default for its Prime members, down from the current two-day free shipping.

Here are some takeaways from the survey, which covered more than 1,900 people

  • Higher spending: 48% of same-day delivery customers said they spend over $800 a year on Amazon, compared to just 33% of those without the same-day shipping option. 
  • More frequent purchases: Same-day delivery users also shop more frequently on Amazon, with 77% of them saying they use Amazon at least two to three times a month versus 50% for non-same-day delivery customers.
  • More loyalty: Same-day delivery shoppers also turn out to have a higher intent to spend on Amazon in the next 12 months, while having a much higher satisfaction rate as well.

“The clear takeaway is that with One-Day and Same-Day Delivery, and Prime Now (1-2 hour delivery), Amazon is creating more convenience and greater selection for shoppers, which enhances the value proposition,” RBC Capital’s Mark Mahaney wrote in a note published Thursday. “The gap between same day delivery customers and other Amazon customers widened across all four categories — spend, purchase frequency, intent of spend, and satisfaction.”

The results are largely consistent with RBC’s surveys from the past four years, although the percentages of people who say they will spend more and shop more often have increased slightly, while customer satisfaction has trended downward.

Here are the survey results (click to enlarge):

190621 amazon delivery survey KIM

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