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Will Uber transform e-commerce delivery?

Written by Tom Ryan

Uber is reportedly partnering this fall with dozens of retailers to provide a speedy delivery option for shoppers on a wide range of e-commerce websites and apps.

According to Re/code, the launch of the service, described internally as UberEverything, will start in Manhattan with some luxury retailers. Talks are also ongoing with B2B e-commerce players, Bigcommerce and Shopify, to reach the many clients they work with rather than making one-off partnerships with every retailer.

Under the set-up, online shoppers in valid zip codes will see an Uber same-day delivery option. Deliveries may be made by bike messenger or cars, depending on the market, with parcels picked up at stores. Stores may or may not pass Uber's delivery fees on to shoppers. Items will not be available for purchase through the Uber app.

UberEverything would build on last fall's launch of UberEats, now operating in nine cities worldwide. The service lets users order through the Uber app and choose from a few menu items during set hours each day. In April, the company launched UberRush, a courier service in New York City.

Uber last year reportedly ran into problems with its delivery experiments. With Gilt, Uber was challenged covering the insurance for lost items. With luxury jeweler Alexis Bittar, at times, not enough drivers could be found to fulfill delivery promises.

Uber bag
Photo: Uber

Uber also faces competition from Amazon, eBay and Google as well as host of startups such as Instacart and Deliv. Both Apple and Starbucks recently chose Postmates over Uber to deliver their goods.

On the plus side, Uber continues to rapidly add drivers with the core taxi service already receiving a valuation of $50 billion. Underlying predictions that it may be the logistics network of the future, Uber already has more than 200,000 active drivers worldwide, roughly double the size of the delivery workforce at UPS.

"There's nobody who has as big of a real-time logistics network than Uber," Jason Calacanis, a serial entrepreneur who was one of Uber's first investors told The Wall Street Journal. "If they can make another business line work with this infrastructure, that could transform the business."

PYMNTS.com likewise wrote that with the costs and complexities around delivery so far outweighing the payback for many stores, e-commerce needs a more efficient delivery system.

According to PYMNTS, "Google-backed Uber, whose play now appears to be on-demand services based on data analytics, is well-poised to serve this need. This would also work to better utilize spare capacity and save costs at a time when the service continues to add drivers aggressively."

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