Google is gaining ground in the market for same-day package deliveries, stepping up competition with Amazon.com, eBay and a host of startups during the holiday shopping season, Bloomberg News reported.
Google Express handled 50 percent more toys in the two weeks after the Thanksgiving holiday, the peak of the year-end shopping season, and sales of books rose more than 30 percent, according to the search giant. Google also added more than 15 new merchants to the service in the past few months, including PetSmart and 1-800-Flowers, bringing the total to about 40. Target, Costco and Staples also sell goods via Google Express.
The service debuted as a free test feature in 2013 but now looks more permanent. Three new cities — Chicago, Boston and Washington — were added in October on top of San Francisco/Northern California, New York and Los Angeles. Google also began charging shoppers $95 a year or $10 a month for unlimited deliveries or $4.99 per eligible order. Same-day or overnight shipping for orders of more than $15 is free for members.
That puts Google head-to-head against Amazon, whose Prime service gives users two-day shipping and access to digital content for $99 a year, and last week began offering one-hour package delivery in Manhattan. EBay also offers a two-hour delivery service in cities including New York, Los Angeles and Boston, while startups such as Instacart (which delivers groceries) and Postmates (which claims under-an-hour delivery in more than 15 cities) are also in the delivery race.
The total U.S. delivery market is projected to be $82 billion in 2016. And delivery speeds are constantly increasing: Only 35 percent of consumers are willing to wait a full week for free deliveries, down from 50 percent two years ago, according to a survey by AlixPartners.