Amazon expanding home delivery

By Dow Jones Newswires
Posted Jan. 25 at 7:54 a.m. Inc. may be expanding a free home-delivery program, a move that analysts say would encourage consumers to do more of their shopping for groceries and other goods with the online retailer.

The service, AmazonTote, is currently available only around Seattle, where the company is based. The program offers customers a free weekly delivery on a specified day and doesn’t require a minimum-order size.

The AmazonTote website said the program “will be expanding soon.” However, that notice was removed later Monday. An Amazon spokeswoman declined to comment.

Such an expansion would be risky. One pioneer of online grocery shopping, Webvan Group Inc., went bankrupt in 2001 and is considered one of Silicon Valley’s biggest busts.

But selling groceries might not be the ultimate goal of AmazonTote, said Fiona Dias, the executive vice president of GSI Commerce Inc., an Amazon competitor that runs websites for about 100 retailers.

“What they want to have is a truck come to your house once a week to deliver whatever you want in it,” Dias said. The intent is “you never have to leave your house to shop again.”

AmazonTote could also benefit the company because it uses it own trucks, rather than a shipper such as United Parcel Service Inc. or FedEx Corp., to deliver goods, Dias said.

Amazon has used its own truck fleet for AmazonFresh, another pilot project that delivers groceries in Seattle.

AmazonTote’s potential expansion was reported earlier by the Financial Times.

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