Amazon's next big business: 'The instant gratification market'

Amazon’s already one of the world’s largest online retailers, but it may be about to crack another entirely new market segment: the “instant gratification market.”

In a note on Tuesday, Piper Jaffray’s Gene Munston noted how Amazon has been expanding its quick delivery offerings recently, and that it could have huge implications on the online retailer’s future outlook.

“Same-day and same-hour delivery have the potential to open an entirely new retail segment to Amazon, the instant gratification market,” Munston wrote. “Traditional retailers have historically enjoyed in-store pick up as a competitive advantage over Amazon. That advantage is slowly going away as Amazon ramps same hour and same day shipping.”

Munston stressed that Prime Now, Amazon’s one-hour deliver service, has launched in 12 new metro areas in the past six months, including LA, Seattle, and Chiacago. Its same-day shipping service has also rolled out in 7 new metro areas in the past 12 months. Prime Now is now available in 13 metro areas in total, while same-day shipping is available in 14 total cities.

Munston added Boston might be next in line, referencing a recent article that hinted at a possible expansion there. He also cited the Prime Now app’s high download numbers (between 500K-1 million downloads) and ratings (4 out of 5) as evidence of its popularity.

On a side note, Amazon is making its $US99 Prime membership available for only $US67 this Friday, to celebrate the five Emmy wins for its original series “Transparent.” Prime members get free two-day shipping, as well as access to tens of thousands of TV shows, music, and books.

Disclosure: Jeff Bezos is an investor in Business Insider through hispersonal investment company Bezos Expeditions.

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