Amazon.com Inc. (AMZN - Free Report) continues to expand its Prime Now Service. Canada is the latest addition to the list of countries receiving this one and two-hour delivery service.
Reportedly, Amazon plans to start this service first in Vancouver. Later, provided the pilot becomes successful, it will expand the service to other Canadian cities throughout 2018.
Currently, Prime Now is available in nine countries, including the United States, United Kingdom and Japan.
Prime Now will likely offer common grocery items, including produce, dairy, frozen food, as well as health and personal care items. The online giant also plans to partner with local bakeries, butcher shops and grocers to bolster Prime Now’s food offerings.
Undoubtedly, the new destination will help the company attract more customers to its Amazon Prime program, which is a significant revenue source.
Amazon has underperformed the industry it belongs to on a year-to-date basis. The company’s shares have gained only 34.5% compared with the industry’s growth of 48.3%.
Amazon Prime Now
In December 2014, Amazon rolled out the one-hour delivery service in a limited area in Manhattan. Prime Now offers two-hour delivery for free and charges $7.99 for one-hour deliveries. All Prime Now items can be browsed and purchased through a dedicated app.
Now, $7.99 might seem a shade steep, if only a few items are ordered. Nevertheless, Amazon offers substantial discounts on these items. So, customers can make up for the delivery charges. Also, there is a convenience cost that comes into play.
Amazon has been making efforts to bump up its delivery system. From a span of a day to two hours, from two hours to 15 minutes, and from 15 minutes to two minutes, Amazon has been cutting down on its delivery time for Prime members.
Only last month, the company launched the Instant Pickup service for Prime and Prime Student members that will get ordered items ready in just two minutes.
Apart from this, Amazon Prime members already enjoy free two-day and one-day deliveries. Also, Amazon Restaurants offers one-hour delivery for Prime members from popular restaurants. AmazonFresh grocery delivery service can fulfill orders within 15 minutes if users pay $15 per month.
Amazon continues to push advantages to Prime members to boost sales, attract more customers and counter Prime saturation in the United States due to increased penetration rates.
Zacks Rank & Stocks to Consider
Currently, Amazon has a Zacks Rank #5 (Strong Sell). A few better-ranked stocks in the broader technology sector are Lam Research Corporation (LRCX - Free Report) and Stamps.com Inc. (STMP - Free Report) , each carrying a Zacks Rank #1 (Strong Buy), while PetMed Express, Inc. (PETS - Free Report) , carrying a Zacks Rank 2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Lam Research delivered a positive earnings surprise of 4.44%, on average, in the trailing four quarters.
Stamps.com Inc. delivered a positive earnings surprise of 30.64%, on average, in the last four quarters.
PetMed Express came up with an average positive earnings surprise of 10.78% in the trailing four quarters.
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