- Amazon may be prioritizing items that can be delivered to you quickly in search results.
- Amazon’s VP of Transportation told the Wall Street Journal the company is prioritizing delivery speed.
- In doubling its warehouse footprint in recent years, Amazon can now ship items within regions of the US faster.
After spending the pandemic revamping its delivery and inventory systems, Amazon may now be ranking items higher in search results if they are located geographically closer to a user in one of its hundreds of regional warehouses.
Amazon Vice President of Transportation Udit Madan told the Wall Street Journal it is just one of many steps the e-commerce giant has taken in recent years to speed up its delivery process. According to Madan, Amazon data shows the faster items are delivered, the more likely a customer will become a return shopper.
As demand for online shopping increased significantly during the pandemic, Amazon also scaled up its warehouse space and hiring to meet the demand, nearly doubling its warehouse space in two years, the Journal previously reported.
Prior to the pandemic, Amazon shipped items across the country no matter where an item was stored, which typically cost more that using regional warehouses, according to the Journal. But as the company looks to cut costs and take advantage of its increased warehouse footprint, Madan told WSJ Amazon has divided the US into eight regions, storing commonly ordered items in each region so shipping can stay as localized as possible.
To help facilitate the focus on shipping within regions, Madan said Amazon’s search results may place items that are closer to a given shopper higher on the page because it would take less time — and cost less — to ship.
“This isn’t something we could have easily done in 2019 because we had a much more sparse network,” Madan told the Journal. “The doubling of footprint really allowed us to have a lot more facilities that were closer placed to customers.”
The plan reported by the Journal to shift Amazon’s shipping strategy from a national to regional model is part of a larger effort to reduce costs across the company that also included laying off thousands of employees earlier this year.
It’s unclear whether that practice could benefit larger sellers that have the product available to spread across regions, compared to smaller Amazon sellers who don’t have as much product. Amazon did not immediately respond to Insider’s request for comment on Saturday afternoon.
However, the process certainly seems to make Amazon deliveries more efficient. Madan told the Journal the company is reporting 76% of orders are now fulfilled from a warehouse in the same region as the customer, compared to 62% last year. The company also said the distance items travel between fulfillment centers and customers has decreased by about 15%.
Another factor for increasing shipment speed is the expansion of Amazon’s same-day delivery centers, where it stores essential items customers typically want quickly like toiletries, the Journal reported. Madan said the use of same-day delivery increased by 50% in the first quarter of 2023 compared to a year ago, with about 26 million customers opting for the fastest option.
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