By Rigel Barros
The news that Amazon was granted a patent for Pre-Shipment (US patent No. 8,615,473 B2) didn’t garner the same national attention as the Amazon drones announcement did. However, it could very well have a greater impact on Amazon’s customers and retailers around the world – it could revolutionize the way fulfillment is done in the future. So what exactly is Pre-Shipment?
To put it simply, Pre-Shipment or “anticipatory package shipping” means that Amazon can begin sending a package to a customer that hasn’t ordered it yet. Amazon has what is perhaps the best algorithm in the industry for recommending products that a customer might like; with this patent, they can take it even further and act on what they expect a customer to buy in the near future. The patent includes several different cool scenarios where Pre-Shipment could be used:
- Amazon ships a product to a general area (say Chicago, for example) without specifying an individual address. While the product is in transit, a customer from Chicago buys this product – and Amazon re-routs this product to the customer’s actual home address. This obviously means that many customers will get their packages hours or even minutes after placing an order.
- Amazon ships a product to a specific customer that hasn’t ordered it yet. If the product arrives and the customer still hasn’t ordered it, Amazon delivers it as a gift to the customer. Think of the brand loyalty that this could help create for Amazon.
- Amazon ships a product to a specific customer that hasn’t ordered it yet. The package stays in continuous traffic until said customer places an order, at which point it is delivered immediately.
All of these scenarios are game-changers for Amazon in a retail world that revolves around faster shipping times and higher customer satisfaction. Pre-Shipment will also strengthen their Fulfillment by Amazon (FBA) program, which allows retailers to use Amazon’s fulfillment network as if it was their own. FBA products currently arrive in 1-2 business days, but with this new technology it is easy to foresee a future where FBA items arrive in 5-6 hours. Interestingly for retailers, almost all of the necessary changes for Pre-Shipment to exist would come during Amazon’s portion of the FBA delivery – it is likely that the process for retailers would remain the same and FBA product prep would continue as before. If Pre-Shipment is realized to its fullest potential, it could possibly be a key factor in maintaining Amazon’s dominance of eCommerce.