For years, free two-day shipping has been the e-commerce standard. Amazon (NASDAQ:AMZN) established it as the baseline for serious online retailers when it offered the perk to its Prime members, and it's the deal Walmart (NYSE:WMT) offers for orders over $35.
Slowly, though, retailers have been selectively adding to their get-it-fast repertoires. Both Walmart and rival Target (NYSE:TGT) now offer curbside pickup of digital orders, and they've tested a variety of other "order online, pickup in store" models.
And for 2018's holiday season, Target is taking things a step further. The company will not only have free, two-day shipping with no minimum purchase, it will also offer same-day delivery "to millions of guests in hundreds of markets across 46 states" through its Shipt service.
"We want to make the busy holiday season easier for our guests so they can spend more time with their family and friends," said CEO Brian Cornell in a press release. "From same-day delivery with Shipt, Drive Up, Free 2-Day Shipping and more, no other retailer can match the convenient delivery options that Target will offer this season."
How does Target's offer compare?
In one sense, Cornell is speaking the plain truth; in another, he's exaggerating a little. Target's same-day shipping offer likely covers more customers than Walmart's city-based, same-day delivery service through Jet.com, or Amazon's Prime Now, which operates in parts of 8,000 cities and towns. Target has yet to lay out specifics as to which customers are covered by the same-day offer, but it did explain some of it.
Now, millions of guests in hundreds of markets across 46 states can have their groceries, gifts for family and friends, decorations and more, delivered to their doorstep in as little as one hour with Shipt. Guests place an order through the Shipt app or Shipt.com and choose from more than 55,000 Target products. Then, Shipt shoppers head to a local Target store to complete the order and deliver it to the guest's door.
Between all of these offers, Target certainly is giving shoppers enough choices when it comes to convenience. From a free-shipping point of view, though -- at least when it comes to two-day delivery -- Target's list of eligible items is far smaller than Walmart's few million, let alone the 100 million items available via Amazon Prime.
Do people want this?
Same-day delivery of groceries or other household items makes sense. If you need ground beef and shredded cheese to make tacos for dinner tonight, or it you've run out of paper towels, any method that doesn't get those items into your kitchen within an hour or two isn't fast or convenient enough.
It's hard to see why that degree of speed would be needed for most holiday purchases. Yes, people cook and entertain throughout the season, which could create added demand, but most folks probably don't need their decorations or gifts delivered quite that quickly.
Need or not, consumers do seem to want same-day delivery, according to a survey conducted by Dropoff. Among the respondents, 43% said they expect "much faster" delivery from retailers this year than last; that's up from 35% who said they were looking for that in 2017. The survey also found an increase in demand for same-day delivery.
Among the product categories that consumers most wanted available via same-day delivery, groceries led the pack: 64% of respondents picked them. Healthcare products (46%), specialty snacks (42%), alcohol (41%), and household products (28%) rounded out the top five.
Even if same-day delivery for holiday-related items has a comparatively more limited appeal, upping its game ahead of the season is a smart move by Target. The retailer gets some well-timed publicity for Shipt, as well as for its two-day shipping and curbside pickup offers, which will likely be bigger draws. But to stay competitive with giants like Amazon and Walmart, it's going to take a strategy that offers something for everyone.
John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Daniel B. Kline has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Amazon. The Motley Fool has a disclosure policy.