Over the years, the retail culture of immediacy has increased to such degree that big players like Amazon – and most recently, Walmart and Target – have made it possible for customers to have their products shipped in a blink of an eye. We all seem to be getting influenced by social immediacy, and the effect that this has on consumer engagement behaviors is staggering.
It is well known that Amazon enjoys breaking its own records; and last April, the eCommerce giant made a multi-million dollar investment to make One-Day shipping the norm for its US Prime members. With this up-to-the-minute shipping option Amazon seeks to increase its revenue growth while allowing customers to enjoy the benefits of faster shipping.
Dave Clark, Amazon Senior VP of Worldwide Operations, stated the following for a CNBC interview:
“Most of this investment is going towards transportation costs associated with speeding up delivery to the millions of Prime customers who are about to begin to experience One-Day Delivery as a new standard shipping option..”
While offering this great service to customers sounds easy to carry off, Premium Shipping is only available to Amazon Seller and Vendor Central’s top performers who have to go through an elegibility process.
Are you aware of all the Premium Shipping options available on Amazon?
Don’t miss out, because one of them could help you attract, retain, and effectively engage customers.
Amazon Premium Shipping Options
As its name suggests, Premium Shipping allows Amazon Sellers and Vendors, that meet high eligibility standards, to provide fast-shipping options to Prime customers. And just as any privilege, Premium Shipping is earned through a demonstrated commitment to customer satisfaction.
Sellers and Vendors must meet a series of requirements to become eligible for these Premium Shipping options. For instance, you must maintain a cancellation rate of less than 1.5% and an order count of ten or more over the course of 30 days across all Premium shipping options. But once they have passed the eligibility process with flying colors, they can choose from the following options to start engaging customers:
- Same-Day Delivery
- One-Day Delivery
- Two-Day Shipping
You must maintain a cancellation rate of less than 1.5% and an order count of ten or more over the course of 30 days across all Premium shipping options.
Keep in mind that, Amazon does not grant exemptions for sellers whose business model does not meet the eligibility requirements. If Amazon revokes your eligibility to offer any of the shipping options above, because your performance metrics have fallen below Amazon established thresholds, you may submit a Plan of Action; nevertheless, this POA only applies to accounts that show a status of Restricted in the Premium Shipping Eligibility tool.
For any of the Premium Shipping options above, you can use Amazon’s approved carriers:
- United States Postal Service (USPS)
This Premium Shipping option is only available in the following US cities: L.A., San Diego, Miami, Chicago, and New York.
The Same-Day Delivery program was intended to cater to the needs of your local customers (the ones that live within your area) by narrowing the window from days to minutes—as long as shoppers place the orders before the carrier’s cut-off time.
Since these customers live just across town, they can get their products faster and cheaper than other storage shipping methods.
Fulfilling orders under this method is pretty easy, you just have to process them as any other order you receive on Amazon and, best of all, it doesn’t require any big investment on your part.
The following product categories are not eligible for this program:
- DVDs (BMVD)
How Much Do Prime Members Have to Pay for Same-Day Delivery?
If you are enrolled in the Fulfillment By Amazon (FBA) program – in which Amazon handles all things related to shipping and customer service – the Same-Day Delivery program comes at no cost for Prime customers on qualifying orders over USD35.
Eligible items are products marked with “Prime FREE Same-Day Delivery”.
When a Prime member buys a product under USD35, they will have to pay a USD5.99 per-item shipping fee. Non-Prime customers can still opt for this shipping method by paying a USD9.98 per-item shipping fee.
If you are fulfilling your own orders through Fulfilled By Merchant (FBM), you get to set your own delivery rates.
Customers ordering from multiple sellers, may be charged multiple shipping fees.
Back in 2005, one-day shipping was a luxury that only few people could afford. Those days are coming to an end. Along with the latest million-dollar investment that Amazon made for this Premium Shipping option to become standard and available to US Prime members, the Company added a large number of new items in new zip codes in the US, and it will focus on rolling out this shipping method first in North America and then internationally.
But what’s with Amazon’s obsession with speed? Put simply, the eCommerce #1 player is trying to compete with brick-and-mortar stores, and let’s be honest, it’s getting there.
This shipping program has gained popularity among Prime customers at such level that Amazon’s ambitious plan is already costing more than expected. So, why is it worth it?
Amazon takes customer satisfaction very seriously, and it spends billions on shipping every year. In the last quarter of 2018, Amazon’ shipping costs jumped 23%, reaching a record 9 billion.
“Customers come to expect consistent fast delivery of anything on Earth from Amazon and our job is to continue to make that happen.”
– Dave Clark, Amazon Senior VP of Worldwide Operations – CNBC interview
Free Two-Day Shipping is a Premium option – only available to sellers who meet high delivery performance standards – that allows Prime customers receive their products within two working days from the day the item was shipped.
This is the “normal” window in which most Premium members – around the world – have received their products to this day.
Enrolling in Two-Day Shipping does not automatically offer your products for Two-Day Shipping. You still must meet the Two-Day Shipping Eligibility Requirements.
Keep in mind that, Amazon may not show the Prime badge on those offers with longer delivery times, because they don’t meet Prime customers’ expectations of Two-Day shipping.
Although One-Day Delivery is still on a development stage in some US cities, sooner rather than later, the standard Two-Day shipping will be replaced by the One-Day Delivery option across the world.
But you may be wondering: How is it possible for Amazon to cater to its customers needs in such a short time?
As of June 2019, there were an estimated 105 million US Amazon Prime subscribers. Despite the fact that Amazon has not revealed the secret of where a product sits before being shipped to the customer, Amazon uses small-business partners – among other logistical processes – to make Same-Day Delivery, One-Day Delivery, and Two-Day shipping a reality.
We are all clear that Amazon loves staying competitive as much as being the number one in customer satisfaction. And as incredible as it may seem, with the recent acquisition of Whole Foods, Amazon is now offering Free Two-Hour Delivery to Prime subscribers with Amazon Fresh.
Considering that about 50% of Prime members shop on Amazon more than twice a week, it wouldn’t hurt to delve into the eligibility requirements for any of the Premium Shipping Options above to find out if your business qualifies.
At the end of the day, as a Seller, you must provide your customers with the best shopping experience – and what better way to start than by using any of the Premium Shipping Options available on Amazon.
About the Author | Duline Theogene | Content Marketer and SEO Copywriter at AMZ Advisors
Duline Theogene is a content marketer and SEO copywriter at AMZ Advisers, with several years’ experience in digital marketing and e-commerce. Duline and the AMZ Advisers team have been able to achieve incredible growth on the Amazon platform for their clients by optimizing and managing their accounts and creating in-depth content marketing strategies.