Amazon committed to investing $4 billion to expand its rural delivery network back in April, “with a focus on small towns across the United States, to bring even faster delivery to our many millions of customers in less densely populated areas.” Today, June 24th, it said that by the end of this year, it will have expanded Same-Day and Next-Day delivery to over 4,000 smaller cities, towns, and rural communities.
Amazon will use AI to predict local customer preferences “so we can stock popular items alongside products curated for specific communities.”
Amazon’s expansion of rural delivery comes at a time when USPS is slowing mail delivery to rural areas. In 2021, the USPS changed service standards for First-Class Mail changing them from 1 to 3 days to 1 to 5 days in the 48 contiguous states. This year, the USPS is “refining” service standards, with the second phase rolling out on July 1st.
In January, the Postal Regulatory Commission (PRC) had called USPS’s proposal to exclude Sundays and holidays as transit days for volume entered into the network on Saturdays or the day before a holiday a “degradation in service.”
So Amazon’s plan to bring faster Prime delivery speeds to thousands of smaller cities, towns, and rural communities is timely, and potentially more impactful.
And Amazon said it’s working. “The response from customers in the more than 1,000 smaller cities, towns, and rural communities where we have already begun offering free Same-Day and Next-Day Delivery has been very positive. As a result of the faster delivery speeds, customers in these areas are shopping our store more frequently and purchasing household essentials at meaningfully higher rates. Of the top 50 repurchased items for Same-Day Delivery in these areas, over 90% are Amazon everyday essentials items.”
Amazon laid out its plan in Monday’s announcement:
- Investing over $4 billion to triple the size of our delivery network by the end of 2026, with a focus on small towns and rural communities across the country, bringing faster delivery speeds and more jobs to these areas. For each new facility we open, we estimate an average of 170 jobs will be created at the delivery stations themselves, plus many more through driving opportunities with the DSP and Amazon Flex programs. For those in full-time roles, our delivery stations provide an average hourly wage nearly triple the federal minimum and benefits like health care from day one of employment.
- Transforming existing rural delivery stations into hybrid hubs that serve multiple functions. This includes storing inventory on site to enable delivery within hours and preparing packages for final delivery to customers. This innovative approach maximizes our existing rural infrastructure to position products closer to customers’ doorsteps and reduce transportation distances.
- Using advanced machine learning algorithms to predict which items will resonate with local Prime members based on their unique needs. This includes stocking a mix of the most-popular and frequently purchased items like wireless headphones, coffee pods, crackers, paper towels, and diapers, and products curated to fit local preferences like wild bird food in Dubuque, Iowa, travel backpacks in Findlay, Ohio, and after-sun body butter in Sharptown, Maryland.
And the marketplace explained how shoppers could check on the availability of same-day delivery: “Customers can see whether their area has Same-Day Delivery by visiting amazon.com/samedaystore and browsing by category, price point, and retail store. Customers can also look for “free delivery today” next to product names while shopping across Amazon.”
Amazon posted the following video about its facility in Iowa on YouTube: