Google just raised the stakes against Amazon with the expansion of its same-day and overnight delivery service.
Google announced on Tuesday that it’s launching Google Express — previously called Google Shopping Express — in Chicago, Boston, and Washington, DC and tacking on an official $US95-a-year membership fee.
The service, which delivers packaged food, electronics, books, clothes, and other products from stores like Target, Barnes and Noble, Staples, and Costco, was previously only available in New York City and parts of California with temporarily free delivery. New users will still get a three month free trial before having to choose between either the $US95-a-year fee or $US10-a-month membership.
Non-members will be able to pay $US4.99 per order. The company is also adding retailers, including Stop&Shop in Boston and Lux Roses in Chicago.
The expansion of Google Express puts the company in closer competition with Amazon, which offers a $US99 yearly shopping membership program called Amazon Prime. Prime promises free, two-day delivery on hundreds of thousands of items, along with unlimited access to a large library of music, movies, books, and TV shows. Amazon also offers a grocery delivery service called Prime Fresh which will deliver groceries, including produce and dairy products, for $US299 a year.
Google has increasingly competed with Amazon when it comes to shopping, both with Express and through the increased sophistication of its product listing ads, which give people lots of information about a product when they search for it on Google. By giving users reviews and prices for different products simply through a Google search, the company is deterring people from starting their shopping directly on Amazon.com, which cuts out a portion of Google’s potential ad revenue.
Sameer Samat, Google’s vice president of shopping, told The Wall Street Journal that adding the new fees and making more deliveries per trip will make Google Express profitable over the long term, despite the costs of hiring a fast-moving delivery fleet. Re/code previously reported that Google has set aside $US500 million to develop its shopping efforts.
Disclosure: Jeff Bezos is an investor in Business Insider through his personal investment company Bezos Expeditions.