Economy First Look

Amazon launches new service to target impulse buying

The online retail giant has rolled out Instant Pickup on several college campuses throughout the US. The service offers a way for consumers to receive orders in a matter of minutes.

An Amazon pickup location at the University of California in Berkeley, Calif. on Aug. 14, 2017.
Jeffrey Dastin/Reuters/File
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  • Jeffrey Dastin
    Reuters

Amazon is rolling out pickup points in the United States where shoppers can retrieve items immediately after ordering them, shortening delivery times from hours to minutes, the company said on Tuesday.

The world's largest online retailer has launched "Instant Pickup" points around five college campuses, such as the University of California at Berkeley, it said. Amazon has plans to open more sites by the end of the year, including one in Chicago's Lincoln Park neighborhood.

Shoppers on Amazon's mobile app can select from several hundred fast-selling items at each site, from snacks and drinks to phone chargers. Amazon employees in a back room then load orders into lockers within two minutes and customers receive bar codes to access them.

The news underscores Amazon's broader push into brick-and-mortar retail. The e-commerce company, which said in June it would buy Whole Foods Market for $13.7 billion, has come to realize that certain transactions like buying fresh produce are hard to shift online. Its Instant Pickup program targets another laggard: impulse buys.

"I want to buy a can of Coke because I’m thirsty," said Ripley MacDonald, Amazon's director of student programs. "There’s no chance I’m going to order that on Amazon.com and wait however long it’s going to take for that to ship to me." 

"I can provide that kind of service here," he said of the new program. 

Instant Pickup puts Amazon in competition with vending machine services. Yet the larger size of the Amazon sites means they are unlikely to pose a threat to those selling snack and drink vending machines to offices and schools. Mr. MacDonald said Amazon considered automating the Instant Pickup points but declined to say why the company had not pursued the idea.

Amazon's ability to shorten delivery times has been a sore point for brick-and-mortar retailers, who have struggled to grow sales as their customers have turned to more convenient online options. Until Instant Pickup, Amazon shoppers could expect to have their orders within an hour at best via the company's Prime Now program, or within 15 minutes for grocery orders via AmazonFresh Pickup. 

Amazon has made two-day shipping standard in the United States.

Instant Pickup prices may be cheaper than those on Amazon.com, MacDonald said. He declined to detail how the items are priced, however.

Other locations in the program now open include Los Angeles; Atlanta; Columbus, Ohio; and College Park, Md. 

This story was reported by Reuters.

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