Amazon plans to spend $800 million to expand Prime from a two-day to a one-day shipping standard.
Amazon said on Thursday that it plans to roll out free one-day shipping for all Prime members nationwide.
The company is investing $800 million over the quarter in its fulfilment network as part of an “evolution” from two-day standard shipping on many items to one-day shipping, Amazon CFO Brian Olsavsky told investors on Thursday.
“[This] opens a lot of potential for purchase and convenience for those customers,” Olsavsky told investors. “We really think it’s going to be groundbreaking for Prime customers, and we’re really excited to add his capability. ”
Currently, Prime members’ orders must total at least $35 on a selection of eligible products to get free one-day shipping, and this option isn’t available for all Prime items. But under the new program, Prime members can expect to receive eligible items in just one day by default.
The company said this “evolution” is a result of 20 years of investment in the company’s sprawling fulfilment network. Amazon has been a retail leader in shipping logistics and has encouraged customers to expect reliable, fast shipping when shopping online. This has prompted big-box competitors like Target and Walmart to convert some of their stores into mini-fulfilment centres for online orders.
Amazon has already been offering same-day shipping to customers in other countries. In the European Union, many Prime members already have the option to get free one-day shipping, and in Japan, shipping on Prime orders is primarily same-day. Amazon told BuzzFeed News that it is “working on speeding up deliveries in every country we serve.”
Amazon has been expanding its selection and eligible zip codes for one-day shipping in the past month. But soon one-day free shipping will be standard for Prime members nationwide. The company told BuzzFeed News it will continue to offer same-day and Prime Now shipping on certain items.