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A concentrated push into a traditional segment should reap rewards for this cutting-edge company.
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With the great run-up in Amazon's (AMZN 0.01%) stock price over the years, some market players could be forgiven for thinking there isn't much upside left in the shares.
I would disagree, especially considering that the company just announced a smart move to boost its business in a surprisingly traditional segment. The market barely reacted to this recent announcement; I feel the move has better potential to help its operations than many might realize.
In mid-August, Amazon announced that it was widening its same-day delivery option for fresh grocery orders made through its site. With the move, according to the retailer, customers in more than 1,000 municipalities across this country will have access to the option.
Image source: Getty Images.
For customers who are members of the company's Prime service, same-day fresh grocery delivery is to be free of charge for orders topping $25 in total in most locations. Under that minimum, a charge of $2.99 will apply. For those lacking Prime, Amazon will charge a $12.99 fee no matter the size of the order.
Such orders can comprise nearly every type of perishable food, including seafood, meat, and dairy products. The company added that organic and natural options for such products will also be available. These goods can be delivered alongside the many other products Amazon offers, the company said, and delivery can be effected within hours.
Amazon is putting its considerable weight behind this effort, and it's clearly determined to become a force in the segment. From the current level of just over 1,000 locations it aims to double the count and then some, to 2,300 by the end of the year.
The company didn't provide any estimates for how this program might impact its fundamentals. However, as it's leveraging its existing capabilities to cover the ever-durable consumer staples segment, if done right the move should boost its overall retail revenue without incurring much additional cost. I'd say that's a win for the company, and reason alone to consider buying the stock now.
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