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Published
Apr 19, 2017
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Walmart, Target could beat Amazon's drone delivery game

Published
Apr 19, 2017

As Amazon pushes its drone delivery service, actual data suggests Target and Walmart are both poised to run a more efficient drone program using their brick and mortar infrastructure.

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Amazon is known for fast and low cost or free shipping. As consumers want their orders as fast as possible, Amazon's same day drone delivery service is designed to create a deeper hold on the market. Data shows however that Amazon won't actually be the strongest drone delivery player in the ecommerce space.

While Amazon is the clear leader in ecommerce, bringing in $96 billion in online sales last year to Target's $3.1 billion and Walmart's 0.8% total revenue growth, drone delivery hinges on geographic location of consumer base.

The Weather Company (TWC) analyzed data for over 3 million consumers that fall within Target and Walmart brick-and-mortar locations and compared those locations to proximity to an Amazon distribution center. Not surprisingly, Walmart and Target brick and mortar locations have a much deeper geographic reach than where current Amazon distribution centers are.

Specifically, drone delivery range is fairly small. Actual packages must also be fairly light for the drone to fly. TWC's data showed almost half of their app users, or 49%, lived within a 6 mile radius of a Walmart store.

Amazon reports that 44% of Americans live within a 20 mile radius from one of its distribution centers. 20 miles, however, is too far of a radius for a drone to currently deliver. Drones that Amazon is currently testing max out at 15 miles round trip, which would put the consumer base just outside of Walmart and Target's current reach.

It is no wonder why Amazon is hustling to open distribution centers and expand its physical presence across America.

If drone delivery becomes the future of e-commerce, as consumer preferences suggest, and Target and Walmart leverage their brick and mortar networks, their existing infrastructure could beat out Amazon's most marketable service.

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