Top AMZN Innovations – Amazon Pantry
Actual launch date: Sometime in 2014
AMZN stock investors just got news yesterday of another innovation from their company. This one is called Amazon Pantry, and it could help the e-commerce giant capture a greater share of consumer spending on packaged goods … an $850 billion category dominated by the likes of Costco (COST) and Walmart’s (WMT) Sam’s Clubs.
Amazon Pantry will supposedly be offered to the company’s Amazon Prime customers, who pay a fee of $75 per year for unlimited two-day shipping. Amazon Pantry will launch sometime next year with 2,000 grocery products such as pet food, cleaning supplies and cereal.
The economics of Amazon Pantry are a bit fuzzy — and thus so is its potential impact on AMZN stock — but here are the basics: In theory, shoppers will choose their merchandise to go in a box with a pre-set weight limit. As long as it does not exceed that limit, AMZN will ship the box of goods for a “small fee” … although it’s not specified what that might be.
It’s pretty hard to imagine a customer not reaching these restrictions when they are buying heavy but commonplace grocery items such as pet food, soda and cleaning supplies. Plus, these boxes might be too heavy for consumers to lift from their doorsteps.
It will be interesting to see how Amazon will tackle that problem — and if Amazon Pantry actually helps AMZN stock keep climbing in 2014.