Amazon expands its perishable delivery service


Amazon's Same-Day Grocery Delivery Expansion: A Consumer Reports Analysis

Bottom Line: Amazon's new same-day grocery delivery service represents the company's most aggressive push into the $1 trillion grocery market, offering competitive pricing and convenience that could reshape online grocery shopping. However, consumers should weigh the benefits against potential product markups and service limitations compared to established competitors.

Service Overview

Amazon announced on August 13, 2025, its expansion of same-day grocery delivery to more than 1,000 cities and towns, with plans to reach over 2,300 locations by year-end. The service allows customers to order thousands of perishable items including produce, dairy, meat, seafood, baked goods, and frozen foods alongside millions of everyday Amazon products, all delivered within hours.

This represents one of Amazon's most significant grocery expansions, introducing thousands of perishable food items into its existing logistics network optimized for speed and efficiency.

Pricing Structure

For Prime Members ($14.99/month or $139/year):

  • Free same-day delivery on orders over $25
  • $2.99 fee for orders under $25

For Non-Prime Members:

  • $12.99 flat fee regardless of order size

Competitive Landscape Analysis

Market Position

The grocery delivery market is intensely competitive, with several major players vying for dominance:

Instacart: Currently holds an estimated 70-75% market share among third-party delivery services, though facing slower growth with grocery sales expected to grow 9.8% to $35.35 billion in 2025.

Walmart: Currently leads in same-day delivery, particularly in groceries, with 48% of grocery-only customers choosing same-day delivery versus 36% for Amazon. Walmart+ membership costs $98 annually and offers same-day delivery in under three hours, with some orders arriving in as little as 30 minutes.

Market Share Impact: Amazon's expansion put immediate pressure on competitors, with Instacart's stock tumbling more than 11%, while Kroger and Albertsons fell about 4% and 3% respectively, and Walmart slipped 1%.

Service Differentiation

Amazon's Unique Advantage: Customers can order milk alongside electronics; oranges, apples, and potatoes with a mystery novel; and frozen pizza at the same time as tools for their next home improvement project—checking out with one cart and having everything delivered within hours.

Competitor Strategies:

  • Walmart benefits from its hybrid retail model, with many customers using curbside pickup or shopping in-store, whereas Amazon's customer base relies more heavily on home delivery
  • Instacart's strength lies in its extensive network of retail partners and independent contractors, offering customers access to local and regional stores

Quality and Logistics

Temperature Control: Amazon uses a specialized temperature-controlled fulfillment network with every item undergoing a six-point quality check upon arrival and before delivery. Temperature-sensitive products are delivered in insulated bags that are recyclable in most curbside recycling programs, the same used for Amazon Fresh and Whole Foods Market deliveries.

Customer Adoption: Early testing showed strong consumer acceptance. In pilot cities like Phoenix, Orlando, and Kansas City, many first-time Amazon grocery customers now return to shop twice as often with same-day delivery service compared to those who didn't purchase fresh food. Strawberries now consistently knock AirPods out of the top 5 best sellers of all products sold, while bananas, Honeycrisp apples, limes, and avocados round out the top 10 most popular perishable grocery items.

Consumer Considerations

Advantages

  1. Convenience: One-cart shopping for groceries and household items
  2. Speed: Same-day delivery within hours
  3. Selection: Access to both national and local brands, including organic options
  4. Integration: Seamless experience with existing Amazon ecosystem

Potential Drawbacks

  1. Pricing: Instacart prices can be marked up to 14% higher than in-store, and similar markups may apply to Amazon's service
  2. Geographic Limitations: Service availability depends on location and proximity to fulfillment centers
  3. Prime Dependency: Best value requires Prime membership
  4. Limited Fresh Selection: May not match the breadth of dedicated grocery stores

Market Impact and Future Outlook

Investment in Infrastructure: Amazon announced in June that it was investing more than $4 billion to triple the size of its delivery network by 2026, with a focus on small towns and rural communities.

AI Integration: Amazon is using artificial intelligence to help predict local customer preferences so it can stock popular items alongside items targeted for specific communities.

Scale Advantage: Amazon generated over $100 billion in gross sales of groceries and household essentials in 2024, not including sales from Whole Foods Market and Amazon Fresh.

Recommendations

Best For:

  • Prime members seeking convenience and time savings
  • Customers who frequently order mixed household and grocery items
  • Urban and suburban areas with reliable delivery infrastructure

Consider Alternatives If:

  • You prioritize the lowest possible grocery prices
  • You prefer shopping at specific local retailers
  • You need extensive fresh produce selection and quality control
  • You live in rural areas with limited delivery coverage

Consumer Tip: Compare total costs including delivery fees, potential product markups, and membership costs against your current grocery spending to determine if the convenience justifies the expense.

San Diego Availability

Amazon announced Wednesday that customers in more than 1,000 cities and towns including Raleigh, North Carolina, Milwaukee, Wisconsin, and Columbus, Ohio, now have access to fresh groceries with its free same-day delivery service on orders over $25 for Prime members, and while San Diego wasn't specifically mentioned in the initial announcement, the service appears to be available there.

Historical Context

San Diego has been served by various Amazon grocery services for years:

  • Amazon Fresh: AmazonFresh announced on Tuesday that it has expanded to San Diego this week. Residents in certain ZIP codes now can bypass the traffic, aisles, lines and hauling associated with shopping for food (this was back in 2014)

  • Prime Now: Amazon said Thursday that its ultra-fast delivery service, Prime Now, is being rolled out to consumers in parts of San Diego. With the launch, people in select ZIP codes from Chula Vista to north of La Jolla can opt for free two-hour delivery (launched in 2015)

  • Whole Foods Delivery: Amazon's free two-hour delivery of Whole Foods groceries for its Prime members is expanding to San Diego on Tuesday (launched in 2018)

Current Service Coverage

Delivery availability: same-day and next-day delivery in 15 cities: Atlanta, Baltimore, Boston, Chicago, Dallas, Denver, Las Vegas, Los Angeles, Miami, New York, Philadelphia, San Diego, San Francisco, Seattle and Washington D.C.

Other Southern California Coverage

The Los Angeles area is also specifically covered, and given Amazon's expansion pattern, other major Southern California cities like Orange County, Riverside, and San Bernardino areas are likely included or will be added as part of the expansion to 2,300 cities by year-end.

To check availability in your specific area: You can visit Amazon's Same-Day Store on Amazon.com or use the Prime Now app to enter your ZIP code and see if same-day grocery delivery is available at your location.

 

Sources

  1. Amazon.com, Inc. (August 13, 2025). "Amazon Announces Major Grocery Expansion." Business Wire. https://www.businesswire.com/news/home/20250813190333/en/Amazon-Announces-Major-Grocery-Expansion-Tens-of-Millions-of-Prime-Members-Can-Now-Shop-Perishable-Groceries-Alongside-the-Rest-of-Amazons-Same-Day-Selection-with-Fast-Free-Delivery
  2. Associated Press. (August 13, 2025). "Amazon expands its perishable delivery service, putting pressure on traditional grocers." San Diego Union-Tribune. https://sandiegouniontribune.com/2025/08/13/amazon-expands-its-perishable-delivery-service-putting-pressure-on-traditional-grocers/
  3. Cerullo, Megan. (August 13, 2025). "Amazon expands same-day grocery delivery to 1,000 cities." CBS News. https://www.cbsnews.com/news/amazon-expands-same-day-grocery-delivery-to-1000-cities/
  4. CNN Business. (August 13, 2025). "Amazon just made it easier to order fresh food." https://www.cnn.com/2025/08/13/food/amazon-grocery-delivery-expansion
  5. Soper, Spencer and Kang, Jaewon. (August 13, 2025). "Amazon to Offer Same-Day Grocery Deliveries in 2,300 Cities." Bloomberg. https://www.bloomberg.com/news/articles/2025-08-13/amazon-to-offer-same-day-groceries-delivery-in-2-300-cities
  6. PYMNTS. (July 24, 2025). "Walmart Outpaces Amazon in Same-Day Deal Days Showdown." https://www.pymnts.com/news/retail/2025/walmart-beats-amazon-in-same-day-delivery-during-prime-week
  7. Investing.com. (June 13, 2025). "Instacart's SWOT analysis: grocery delivery leader faces ad revenue challenges." https://www.investing.com/news/swot-analysis/instacarts-swot-analysis-grocery-delivery-leader-faces-ad-revenue-challenges-93CH-4095579
  8. eMarketer. (January 8, 2025). "Instacart's latest partnerships will help diversify its retail and advertising businesses." https://www.emarketer.com/content/instacart-retail-advertising-partnerships-2025
  9. Business Model Analyst. (May 27, 2024). "Top 12 Instacart Competitors and Alternatives (2025)." https://businessmodelanalyst.com/instacart-competitors-alternatives/
  10. Rolling Stone. (May 15, 2025). "The 7 Best Grocery Delivery Services 2025: Amazon, Instacart, Shipt." https://www.rollingstone.com/product-recommendations/lifestyle/best-online-grocery-shopping-delivery-services-1234681461/
  11. Amazon expands its perishable delivery service

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