Will we ever need to leave the house again? Uber trials same-day delivery service

Derek du Preez Profile picture for user ddpreez August 20, 2014
Summary:
This is a fast-growing market and new services are springing up all over the place. But it's also an open market and tech companies are waging war to mark their territory.

Uber is once again causing a stir, as it has announced the launch of a same-day delivery service in Washington DC – signalling a warning shot to the likes of Google and Amazon that it is prepared to fight for a stake in this market.

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By: Health Gauge

This trend for on-demand delivery has me slightly worried, but more on that later...

Although the Corner Store experiment will only run for a few weeks, Uber did say in its blog that “the more you love it, the more likely it will last”. Game on.

The trial is likely an attempt to test how Uber could possibly take on existing services operated by Amazon and Google. Amazon currently runs a same-day grocery service called AmazonFresh in California and Seattle, whilst Google offers Shopping Express in San Francisco (which is soon to be rolled out to New York and LA).

Uber's service provides users in DC with an inventory list of over 100 items, which are priced in line with what you would find in-store, and is available in two zones of the city between 9am and 9pm, Monday to Friday.

There is no minimum purchase required, there is no delivery charge and from the inventory list you can purchase everything from skittles, to ear plugs, to condoms - all from the comfort of your home without having to move much more than your finger across your smartphone screen.

Retail analyst Stephen Mader said that Uber drivers may benefit from additional freelance work making deliveries during quiet periods, but he also questioned whether or not the economics stacks up and asked how Uber was going to monetise the service. Mader told the BBC:

The biggest hurdle that a lot of these delivery companies have is how can you make the economics of last-mile grocery deliveries add up?

On average, Uber's price points are on a par with what you would find in a physical store such as Walgreens, so what it is trying to do is take the pricing equation out of it from the shopper's perspective.

But long-term this is most likely not going to be economically feasible unless Uber starts to figure out other ways to monetise this, through adding delivery fees or charging advertising fees to brands that take part in the programme.

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Retailers offering online order and home delivery should also be thinking about how this trend impacts them in the long term. At the moment e-commerce is a priority for retailers, but the current model for many is next-day delivery or click and collect -this might need reassessing as things progress.

However, the last point that Mader makes is most pertinent. He said:

It's disruptive - shoppers now expect either a retailer or a third-party delivery service to have the ability to get a product to them as fast as conveniently possible.


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Does this worry no-one else?

Mader isn't wrong. This market is accelerating and incredibly convenient delivery options are becoming increasingly available (mostly in the States at the moment, but it won't be long before this expands).

For example, Instacart is an application that has a number of personal shoppers at its disposal that for a fee will go and pick up a range of products for delivery, right to your door, within a couple of hours. Elsewhere, Boston-based alcohol delivery service Drizly is doing well and expanding its presence. There is even an app, Eaze, which delivers marijuana for medical users in California.

We are only beginning to scratch the surface of opportunities available here, but there will no doubt be an expanding number of applications and services becoming readily available to us – without us ever having to leave our house.

I sent out a tweet earlier asking if anyone else was worried about this emerging trend – and I only got two responses, both of which implied that the idea of having whatever you wanted deliverable within a short time frame was a fantastic idea.

I've written before about my concerns, stresses and the love/hate relationship I have with the mobile internet – and this only adds to them. The reason I worry is because I know I would be an avid user of these services, whether I like to believe it or not.

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Image credit: Todd Keith/Getty Imageworry is because I know I would be an avid user of these services, whether I like to believe it or not.

The idea that I could sit on my sofa and get whatever I want brought to me without moving, without even having to get out my card, is so incredibly convenient that it almost doesn't make practical sense to leave the house to go to the store. But do I really want rely on my smartphone even more?

Not only are a significant proportion of my social interactions online and through my mobile (don't worry, I still see my friends in real life), but now I'm also not going to have to leave the house get my coffee or breakfast in the morning? Given that I work from home, this could mean that I wouldn't have to leave the house for days if I felt that way inclined.

“Stop moaning and go out if you're that bothered!” - I hear you say. And yes, obviously I have the choice what to do with my day, but as we all know, convenience wins out 98% of the time.  My point is that even though these services are innovative, convenient and disruptive - as this market grows it will have far reaching implications for society, communities (and the economy) that we haven't even thought of.

That's not to say that it shouldn't happen, of course it should. Innovation is unstoppable and I will no doubt be using these services. However, for the record, I also just wanted to include a few words of warning...

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