clock menu more-arrow no yes

Filed under:

How Much Would You Pay for Same-Day Delivery?

Racked is no longer publishing. Thank you to everyone who read our work over the years. The archives will remain available here; for new stories, head over to Vox.com, where our staff is covering consumer culture for The Goods by Vox. You can also see what we’re up to by signing up here.


Photo via Shutterstock
Same-day delivery—a staple of online shopping in the UK—is headed to America.

A startup called Shutl, which is backed by UPS, is launching the service right here in the U.S.A. in just a few weeks. It will debut in New York, San Francisco, and Chicago, eventually expanding into 12 cities, and typically costs less than $10 per order, Wired reports.

Shutl isn't the first to venture into the world of same-day delivery. Net-a-Porter already does it in New York for a $25 fee. Google just announced that they, too, will be testing the service in San Francisco with the nacent Google Shopping Express service. Walmart is doing it. Amazon has been leading the charge (albeit in a very limited way) since way back in 2009. Even the U.S. Postal Service and FedEx are experimenting with the service in some areas now. But Shutl thinks they're in a position to be the best, at least when it comes to urban consumers.

Here's how it works: Shutl—which considers itself a software company, not a shipping company—partners with retailers on one end and courrier services on the other. And then they essentially play matchmaker, giving the customer the option of 90-minute-delivery (in the case of a major retail emergency), or simply a specific one-hour window of her choosing.

The downside: You have to live within 10 miles of the store you're ordering from. (The other downside: Shutl hasn't yet revealed which retailers the company is working with in the U.S.)

But the upside is that this business model makes Shutl way more flexible than, say, Amazon, which has only about 40 distribution centers in the US—most of them quite a ways away from big cities. "[Amazon's] idea of local distribution is at state level," Shutl CEO Tom Allason told Wired. "Our idea of local distribution is at street level."

The question remains whether American consumers are going to be willing to shell out for the service, however. Business of Fashion ran a story yesterday suggesting that we are not.

A survey of 1,500 U.S. consumers conducted by The Boston Consulting Group found that shoppers would pay $7.50, on average, to get a $50 online purchase delivered on the same day. BoF explains: "That is lower than the fees charged by most retailers and e-commerce companies now providing these services."

Boston Consulting Group partner Rob Souza says it's basically a losing battle for businesses. "The demand for this service and the willingness to pay do not match the cost of providing it."

We're curious: How much would you pay for immediate shipping gratification? Take our poll below.

Poll results


· E-tailers Embrace Same-Day Delivery, but US Shoppers Shrug [BoF]
· Amazon's Massive New Warehouses Will Get You Your Stuff Faster [Racked]
· How Walmart Intends To Revolutionize E-Commerce [Racked]