Google expands same-day delivery, offers annual membership

Google (NASDAQ:GOOG) announced it would expand its Shopping Express—now called simply Express—platform to three new cities: Chicago, Boston and Washington, D.C. The same-day delivery will now be available to 7 million new customers.

Google Express offers groceries, office supplies and household goods from local retailers, including Target (NYSE: TGT), Whole Foods (NASDAQ: WFM), Costco (NASDAQ: COST), Office Depot (NYSE: ODP) and Walgreens (NYSE: WAG). While the service started in the Northern California area, in spring it rolled out in Manhattan and west Los Angeles.

"With Google Express, the company is looking to establish a direct relationship with consumers," said Vishwa Chandra, a principal in the retail practice of A.T. Kearney, a global management consulting firm. "While initially complementary to brick-and-mortar retailers' desire to have an omnichannel offering, they still run the risk of being disintermediated in the medium term as Google gains a better understanding of consumer needs and is able to be more directive of their purchases. At the end of the day, Google is an insights company. Google Express puts them right in the middle of customers' shopping behavior–and how they can monetize it is based on their ability to directly influence what people spend their money on, and where they spend it."

It seems the competition is heating up between Google and Amazon (NASDAQ:AMZN), which also announced the expansion of its same-day delivery option within days of Google's announcement last spring. Now Google has also introduced a membership program, similar to Amazon's Prime.

Google members will receive free same-day or overnight delivery on orders over $15, first dibs on delivery windows, and shared membership with a household member.

In addition, Google announced it added 16 more merchants, national and local, over the last few months, including 1-800-Flowers, Barnes & Noble, Nine West, PetSmart, Vitamin Shoppe and Sports Authority.

Membership costs $95 a year or $10 a month. New shoppers can try the first three months of membership for free. Without membership, each order costs shoppers $4.99.

For more:
-See this Google blog

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