Amazon’s latest earnings conference call included the reveal of a major shift for the paid Amazon Prime subscription service: an “evolution” to one-day shipping as a nationwide default.
“We’re currently working on evolving our Prime free two-day shipping program to be a free one-day shipping program,” Amazon CFO Brian Olsavsky said in the company’s quarterly investor relations call.
The news came as a response to questions about both incremental-spending and revenue-acceleration predictions in certain portions of the company’s Q2 financial guidance, which Olsavsky said revolved significantly around this push for faster default Amazon Prime shipping speeds.
Amazon has not yet formally announced this initiative via any of its news or PR channels, and Olsavsky did not offer an estimate of exactly when this would become a nationwide default for the subscription service.
Olsavsky reminded listeners that Amazon has long offered options like one-day and same-day shipping for standard Amazon orders, along with Prime Now delivery windows of one and two hours, which he attributes to “20-plus years of expanding our fulfillment and logistics network.” Amazon will continue to offer “accelerated basis” shipments, assumedly for an additional fee, in addition to current efforts to shrink general shipment times for all products down to a single day.
“We’ve already started down this path,” Olsavsky said, and he pointed to both an expanded number of ZIP codes and product selection for one-day delivery. (This would explain why your intrepid reporter’s last Amazon order arrived to his Seattle shipping address in only one day, in spite of selecting “standard two-day shipping” at checkout.)
Amazon’s guidance estimate hints at an expectation that default one-day shipping will drive increased revenue for product sales. Olsavsky emphasized this by saying, “We’ve seen good order trends, month-to-date,” with current, paying Prime customers already enjoying the benefit in various parts of the nation. He did not hint that Prime subscription fees would climb yet again as a result of this shipping-speed upgrade, and neither did he point to a “minimum order amount” needed to take advantage of this one-day Prime perk.
Amazon’s two-day Prime subscription service launched in 2005 as a $79/year guarantee that all Amazon orders would come with free two-day shipping. In the 14 years since, the service has been bundled with a litany of Amazonofferings, along with two significant price bumps, including last year’s jump to $119/year.