Extremely Competitive Prices Almost Need Help Wit

DA 6: Review the following news item to motivate your discussion.

I Dream of Genie, no Amazon!

For your discussion, I am including below links to news items profiling Amazon’s new acquired patent on the idea of anticipatory delivery shipping. This is a company that invests huge amounts of capital in research and development to reduce costs and gain efficiency in the largest part of their supply chain, delivery to the customer. Amazon has now beaten everyone else in the industry to the punch–it has now successfully patented a “method and system for anticipatory shipping.” Using the metadata Amazon collects on its customers (things like how long you hover your mouse over an item), they developed algorithms to predict when it is likely for customers in particular geographical areas to purchase particular products. The products are packaged for home delivery and sent to the targeted geographical hub, before a specific physical address is labeled on the package (since the customer hasn’t actually ordered anything yet). Provide your opinion on what your learned from this news item. In your discussion, you may include your insights on its long-term implications, both good and bad, not just for Amazon but for the entire retailing industry.

News Item 1: Amazon plans to ship your packages before you even buy them (clicking this link will download the item as a PDF file)

News Item 2: Amazon’s US patent for anticipatory delivery shipping (clicking this link will download the item as a PDF file)

This is my friends post(Sample post):

Amazon has become a major online retailer in the past few years. Their extremely competitive prices almost guarantee lowest prices for any good sold. The only problem has been the shipping aspect. It takes a lot of time to ship and is costly. Amazon has been able to get rid of the cost for customers by offering the Prime service which is an annual subscription that lets customers get eligible items within two days of purchasing. Although they have done this, if an item is not close to the customer, there is no way to avoid the longer shipping times to transfer the purchased item to the customers’ location. Amazon’s anticipatory delivery shipping system will (or maybe has) fixed a lot of these issues. By using an algorithm to anticipate when someone will make a purchase of a specific item and shipping it to that location before the item is even purchased, Amazon is able to shorten the time it takes to get the purchased item to their customers. I remember having many problems with Amazon Prime where the item would be labeled as delivered and coming in two days afterwards. Recently, I have not had many problems with Prime and have gotten my package by the expected date or even earlier.

Anticipatory shipping has many pros and cons. Pros include being able to ship the products to customers faster, avoiding situations where an item labeled as Prime to come in later than expected, and these two build reliability in the Prime service. By building up reliability, more people will be willing to subscribe to the service and make purchases off of Amazon. Cons include extra costs to ship items that are not even ordered yet, possibility of customers not purchasing the good, and extra costs to store those goods if not purchased by customers in that location. Overall, it will strongly benefit customers who pay for Amazon Prime and I personally always end up buying the items I look at and hover my mouse over most of the time. So if this is the case for other people, I believe that the costs of turnover from this system will be worth gaining and retaining new and old customers from Amazon’s reliability in fast shipping.