Starting Sepember 27, e-commerce giant Amazon.com Inc. (Nasdaq:AMZN) is offering free same-day deliveries to Metro Vancouverites who are so-called Prime members, which is a designation that means that they are also paying Amazon $79.99 per year.
To qualify for the free same-day delivery, the Prime members’ orders must be received by noon and be at least $25, Amazon Canada vice-president Alexandre Gagnon told Business in Vancouver September 26.
People who have not put up the $79.99 for an annual Prime membership can still get same-day delivery in most parts of Metro Vancouver although they have to pay $11.99 for shipping, Gagnon said.
“We believe in the value of Prime,” he said. “It’s a very important initiative for us.”
Amazon operates two fulfillment centres in Metro Vancouver. A 200,000-square-foot facility opened on Annacis Island, in Delta, several years ago. Amazon at the time said that the centre would employ about 100 people.
The company then reportedly opened a second, 236,000-square-foot fulfillment centre New Westminster. According to an email from Amazon late on September 26, its New Westminster fulfillment centre has expanded to "over 550,000" square feet. It is also leasing 156,000 square feet of office space at the Telus Garden development in downtown Vancouver.
Each of Amazon's fulfillment centres employ "hundreds" of employees, according to Amazon. Gagnon would not say how many people the company now employs in Vancouver.
A December report from Vancity estimated that Amazon controls 30% of the Canadian online shopping market.
Gagnon would not reveal, even approximately, what percentage of Amazon’s Canadian shoppers are Prime members.
Consumer Intelligence Research Partners (CIRP), however, reported this summer that it estimates that Amazon has 63 million Prime members globally. That’s about 19 million more Prime members than a year earlier and is now a majority of those who buy products on Amazon.com.
Predictably, it is the power-shoppers, or frequent purchasers, who buy Prime memberships.
CIRP estimated that Prime members spent US$1,200 on average last year on Amazon.com, whereas non-members spent an average of $500.
Gagnon noted that in addition to free shipping, Prime members also get free access to a cloud where they can store photos.
The company's Amazon.ca has a function on its website for Prime members to plug in their postal code to see if they are close enough into Metro Vancouver to be eligible for the free shipping.
