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MailTribune.com
  • Cash-strapped post office tests same-day delivery

    If successful, program would quickly spread to major cities in '13
  • WASHINGTON — Emboldened by rapid growth in e-commerce shipping, the cash-strapped U.S. Postal Service is moving aggressively this holiday season to start a premium service for the Internet shopper seeking the instant gratification of a store purchase: same-day package delivery.
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    • Four tips to conquer Cyber Monday today
      You survived Black Friday. Or maybe you just avoided it altogether. Either way, get ready to take your shopping spree online for Cyber Monday.
      If you haven't already done so, here are a few thi...
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      Four tips to conquer Cyber Monday today
      You survived Black Friday. Or maybe you just avoided it altogether. Either way, get ready to take your shopping spree online for Cyber Monday.

      If you haven't already done so, here are a few things you may need to do to get ready:

      Membership has advantages: Join the loyalty programs for any stores where you plan to shop. Also sign up for their email alerts, follow them on Twitter and Pinterest, and "like" them on Facebook for additional deals and up-to-the minute information.

      Divide and conquer: Create a dedicated email account for your online shopping so you don't have to sift through personal emails to get the deals. This is also a good place to send e-receipts from brick-and-mortar stores.

      C'mon, get appy: An increasing number of applications can help you navigate the world of e-commerce with your smartphone or tablet. For example, TheFind.com's app helps you compare prices of items online and watches when they drop. The PriceBlink app self-activates every time you shop online, and will alert you to coupons and special offers for the site you're shopping on. It also lets you know if the same item is available for less anywhere else in cyberspace. The TGICyberMonday app aggregates Cyber Monday deals from major retailers.

      Be safe: Instead of paying with debit cards, use credit cards, which have better fraud protection. Don't save your information at retailers' websites; enter it manually each time. Shop from home. Your home connection is more secure than public networks or Wi-Fi, even at work. And if you are at work, remember to heed your company's policy for surfing the Web.

      — The Associated Press
  • WASHINGTON — Emboldened by rapid growth in e-commerce shipping, the cash-strapped U.S. Postal Service is moving aggressively this holiday season to start a premium service for the Internet shopper seeking the instant gratification of a store purchase: same-day package delivery.
    Teaming up with major retailers, the post office will begin the expedited service in San Francisco on Dec. 12 at a price similar to its competitors. If things run smoothly, the program will quickly expand next year to other big cities such as Boston, Chicago and New York. It follows similar efforts by eBay, Amazon.com, and most recently Walmart Stores Inc., which charges a $10 flat rate for same-day delivery.
    The delivery program, called Metro Post, seeks to build on the post office's double-digit growth in package volume to help offset steady declines in first-class and standard mail. Operating as a limited experiment for the next year, it is projected to generate between $10 million and $50 million in new revenue from deliveries in San Francisco alone, according to postal regulatory filings, or up to $500 million, if expanded to 10 cities.
    The filings do not reveal the mail agency's anticipated expenses to implement same-day service, which can only work profitably if retailers have enough merchandise in stores and warehouses to be quickly delivered to nearby residences in a dense urban area. The projected $500 million in potential revenue, even if fully realized, would represent just a fraction of the record $15.9 billion annual loss that the Postal Service reported recently.
    But while startups in the late 1990s such as Kozmo.com notably failed after promising instant delivery, the Postal Service's vast network serving every U.S. home could put it in a good position to be viable over the long term. The retail market has been rapidly shifting to Internet shopping, especially among younger adults, and more people are moving from suburb to city, where driving to a store can be less convenient.
    Postal officials, in interviews with The Associated Press, cast the new offering as "exciting" and potentially "revolutionary." Analysts are apt to agree at least in part, if kinks can be worked out. "There is definitely consumer demand for same-day delivery, at the right price," said Matt Nemer, a senior analyst at Wells Fargo Securities in San Francisco. "The culture in retail traditionally has been to get a customer into the store, with the immediacy of enjoying a purchase being the main draw. So same-day delivery could be huge for online retailers. The question is whether the economics can work."
    He and others said that consumers are a fickle lot when it comes to shipping, seeking fast delivery, but also sensitive to its pricing. Many will order online and pick up merchandise at a store if it avoids shipping charges, or will agree to pay a yearly fee of $79 for a service such as Amazon Prime to get unlimited, free two-day delivery or even purchase a higher-priced item if it comes with "free" shipping.
    "Customers do like same-day delivery when it gets very close to a holiday or it otherwise becomes too late to shop," said Jim Corridore, analyst with S&P Capital IQ, which tracks the shipping industry. "But while the Postal Service has the ability to deliver to any address, they are not always known for their speed. To increase their speed might prove to be a much more complex offering than they're thinking about."
    As the Postal Service launches Metro Post and sets pricing, its target consumer is likely to include busy professionals such as Victoria Kuohung, 43.
    A dermatologist and mother of three young children, Kuohung for years has gone online for virtually all her family's needs, including facial cleansers, books, clothing, toys, diapers and cookware.
    Kuohung lives in a downtown Boston high-rise apartment with her husband, who often travels out of town for work. The couple say they would welcome having more retailers offer same-day delivery as an option. Still, at an estimated $10 price, Kuohung acknowledges that she likely would opt to wait an extra day or two for delivery, unless her purchase were a higher-priced electronics gadget or a special toy or gift for her son's birthday.
    "I prefer not to spend my time driving in a car, fighting for parking, worrying about the kids, dealing with traffic, and battling crowds for a limited selection in stores," said Kuohung, as her 1-year-old-twins and 4-year-old son squealed in the background. "But right now Amazon delivers in two days since I'm a member of Prime, so it would have to be something I can't get at the corner CVS or the grocery store down the street."
    Under the plan, the Postal Service is working out agreements with at least eight and as many as 10 national retail chains for same-day delivery. The mail agency says nondisclosure agreements don't allow it to reveal the companies. But given the somewhat limited pool of large-scale retailers — they must have a physical presence in 10 or more big U.S. cities to be a postal partner — the list is expected to include department stores, sellers of general merchandise, clothiers, even perhaps a major e-commerce company or two.
    Consumers will have until 2 or 3 p.m. to place an online order with a participating retailer, clicking the box that says "same-day delivery" and making the payment.
    Postal workers then pick up the merchandise from nearby retail stores or warehouses for delivery to homes between 4 and 8 p.m. that day.
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