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Here’s what you need to know about Amazon Prime Pantry

  1. It’s only the minor formalization of a solution that has been available for a while –  the “Add On Item” which you could add to your cart and Amazon would drop the add on item into your box whenever your next shipment for another “regular” product was shipping. If you were a Prime member, you probably frequently had shipments coming – so it wasn’t a big deal to wait. This just seems to remove the wait (while also adding higher perceived value to the now higher cost Prime membership).
  2. Amazon is one of the only (if not the only) e-tailer that can handle small units/order delivery…so they are showing off here (unless your comparison of the $99 membership fee is unfavorable vs. the $5.00 per transaction delivery fee of the other players). As Amazon improves the service (faster delivery for less cost) they get closer to closing the “last mile”  – the 75% of all retail spending that occurs within a mile of the home. This is what is motivating not only Amazon, but also Google Shopping Express and eBay now and others).
  3. To close the gap on “the last mile”, Amazon (and Google Shopping Express and eBay Now and Instacart, etc.) have to come up with a consumer value proposition that is better, simpler, easier than “I’ll just pick that up on the way home from work”. When (not if) they do, we will see more significant and rapid changes in the retail landscape than has yet occurred in our lifetime.

http://blogs.wsj.com/digits/2014/04/24/amazon-prime-pantry-service-seeks-to-slim-down-bulk-ordering/

Susan O’Neal Gear has over 20 years of experience at the intersection of consumers, marketing and technology. Passionate about all aspects of a consumer’s relationship with brands and retailers, we’re spending the next year looking for new, groundbreaking thought leadership  – if not disruptive solutions – with the potential to redefine the parameters of consumer loyalty. If you also want to see some game changing happen -then follow Upstream Insight, contribute your voice, share this post…do something!