One of the 'big four' UK supermarkets, Morrisons, has partnered with Amazon Prime to allow its customers in selected areas to order a full Morisons shop online via the Prime Now app. This new service will offer Amazon customers same-day delivery of goods from its stores, with the option to pick-up deliveries in store, or to be delivered within one hour for £6.99 or in a two hour slot for free.
The initiative, which has launched in selected postcodes in London and Hertfordshire, will broaden Morrisons wholesale supply service to Amazon customers and has been extended to thousands of products.
Following the launch of this new service, shares at Ocado, an online-only retailer, have fallen by more than 6%. Ocado has handled the distribution network and IT behind Morrisons website and delivers in north London and the majority of England.
The agreement between Morrisons and Amazon is said to help boost sales for their groceries, particularly with Christmas just round the corner.
However, Morrisons are not first supermarket to the introduce this initiative. Following its £1.4bn acquisition of Home Retail Group, Sainsbury's have started to introduce Argos digital concessions to a number of its stores and is aiming to extend this to opening Habitat stores in the supermarket.
The aim behind this initiative is to allow customers to shop across three high street brands and over 90,000 products in one store, with the combination of Sainsbury's and Argos it creates one of the UK's leading food and non-food retailers.
Earlier this year, eBay celebrated their 10 millionth parcel being delivered through the Argos Click & Collect network. The eBay and Argos partnership has grown since the expansion into Sainsbury's providing over 1,000 collection points across the UK with over 95% of the British population being only 10 miles away from an eBay collection point.
Online retailers are continually looking for innovative and productive ways to boost sales and make the shopping experience more convenient and enjoyable for their customers. However, with Amazon keeping control over the pricing, this could have negative impacts for Morrisons brand with the risk of Amazon undercutting deals and offers Morrisons are offering to their in-store customers.