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How Much Would You Pay for Google’s Same-Day Delivery?

Google is one of a number of entities working on developing a same-day delivery service, and it recently surveyed users to find out how much they would be willing to pay for such a service. (Google is still not charging for the service after launching 6-month trials in March 2013.)

What’s fascinating is that Google sent out a more raw survey in June, which blogger Rags Srinivasan critiqued.

Two months later, Google sent a more refined version of the survey, as reported by AndroidPolice.com.

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It’s fascinating to see how Google fleshed out its thinking on pricing. In June, it broke out items into Perishable and NonPerishable (and alcohol). In August, that became: regular orders; alcohol; and refrigerated goods.

And, as the screenshot published by Srinivasan in June shows, Google was thinking about offering a “no membership (Pay-per-use)” plan along with a basic ($149/year) and premium ($199/year) membership plans.

By August, Google was considering offering a “Pay per order” fee schedule (with no annual fee) and a “Member” plan ($8/month or $89/year – another recipient of the survey was shown $10/month or $99/year).

Wall Street analyst Brian Nowak of Susquehanna International Group wrote a report on the survey. He showed another question that asked respondents to indicate the key reasons for their continued use of Google Shopping Express, ranging from saves me time; the selection of merchants available; and the ability to buy from multiple merchants in one checkout.

Google also asked survey respondents how their Amazon Prime subscription influenced their likelihood of signing up for a Google Shopping Express membership.

Nowak wrote: “All signs points to Google becoming a larger and larger competitor against Amazon, as both pursue more volume from the ~$1tn of consumer packaged goods and grocery expenditure. This is a trend to monitor and potential threat to Amazon’s important efforts in CPG and grocery. Google’s partnerships with traditional retailers and grocers make its model much less capital intensive than Amazon’s fulfillment model, and Google’s 70%+ core advertising incremental margins give it a lot more firepower to invest (in product subsidies, shipping, etc.) to drive user adoption.”

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Ina Steiner

Ina Steiner is co-founder and Editor of EcommerceBytes and has been reporting on ecommerce since 1999. Send news tips to ina@ecommercebytes.com.


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