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With the lofty goal of delivering vast swaths of his mighty e-commerce firm’s sprawling inventory within one hour, Amazon.com ( AMZN ) CEO Jeff Bezos has struck cybergold — shoppers have flocked to the latest iteration of his Amazon Prime loyalty program, Prime Now. Amazon executives have described rapid delivery as both difficult and expensive — and have acknowledged that customers love it. And Amazon loves its customers, so much that Bezos repeatedly has said the company will forego profits to please them. Cowen & Co. Tuesday released results of its survey of 1,200 Amazon Prime customers that it says shows one in four already have adopted Prime Now. It’s basically free. With order via a mobile app, Prime Now will deliver a large number of Amazon-bought goods within two hours in areas of the nation where the service is available. Customers can use the app for one-hour delivery as well, but there’s a $7.99 charge for that. Prime Now is one Amazon salvo in a multiyear campaign to snatch more of the household budget. Amazon.com stock was up more than 3.5%, near 573, in afternoon trading on the stock market today . The company carries an IBD Composite Rating of 78, where 99 is the highest. Cowen analyst John Blackledge, in the research report, says that Bezos’ approach with Prime Now complements Amazon’s same-day and two-day services, and adds more value to its grocery operations Pantry and Fresh. Wal-Mart Vs. Amazon Heating Up Wal-Mart ( WMT ) — by far the largest brick-and-mortar retailer — makes bank on its grocery business, which accounts for about half of its top line, according to ChannelAdvisor ( ECOM ) Executive Chairman Scot Wingo. But Amazon is encroaching on Wal-Mart’s business. “We view Prime Now as one of the pathways Amazon is using to gain share in the $1 trillion grocery market,” Blackledge wrote. “Our early survey work suggests the strategy is working.” The survey indicated that 70% of those responding bought goods via Prime Now multiple times a month — and about a third of shoppers bought groceries from a local store that elected to list its items on Prime Now. The service is available in 24 markets that account for nearly half of the U.S. gross domestic product, says Blackledge. Food delivery is available in seven markets. Prime Now’s success is also a blow to eBay ( EBAY ), which continues to struggle to maintain relevancy for shoppers. Plagued by problems such as a significant data breach and SEO challenges following a change in Alphabet ( GOOGL ) subsidiary Google’s search engine algorithm, eBay has been unable to match Amazon’s double-digital growth rate. Disagreeing with recent investor sentiment — eBay stock has had a choppy beginning to 2016 — Wells Fargo analyst Matt Nemer says that eBay has potential, albeit as a hedge against a potentially slowing global economy. And for its part, eBay has been making significant bets on restructuring the way it lists items. But as Amazon continues to innovate its way to riches, some say that its position as the dominant e-tailer is impenetrable . That hasn’t stopped rivals, however. Privately held Jet.com is making a stab, also offering two-day shipping, and Alibaba ( BABA )-backed ShopRunner is also taking aim at Amazon. ShopRunner executives have told IBD that the company plans to take on Amazon in categories where the Seattle-based company doesn’t have a strong foothold, such as fashion. Scalper1 News
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