Amazon has been tipped to launch a local services marketplace this year to rival the likes of Thumbtack, Angie’s List and Yelp. Now one part of that effort looks like it’s about to go live: the company is now rolling out a food takeout service, a direct competitor to GrubHub, Seamless and DeliveryHero.
The offering is initially going to be part of Amazon Local, the company’s Groupon-style service and app that offers people daily deals, coupons and discounts from merchants in their neighborhood. The service, which was scheduled to launch first in Seattle and on iOS, was quietly turned on the app last night but taken down again. It should go live again soon.
We have reached out to Amazon spokespeople to confirm the details of the service, but here is what we know: it will eventually go global, but much like Amazon’s Fresh delivery service for groceries, it will be a “VERY gradual expansion unless things go gangbusters,” says someone familiar with the situation. That’s a reference to the service seeing a slow rollout from Seattle eventually to parts of California.
But the company is very ambitious nonetheless. From what we understand, Amazon is also weighing the possibility of acquiring companies to expand in services.
Acquisitions are unlikely to be of bigger companies like Postmates, which covers deliveries of food but also of any local store. But among those that have been floated are food delivery companies Caviar and Peach, and a left field suggestion — Truffle, the Seattle-based dating service that starts by arranging meetings in cafes before suggesting other places for people to go together.
“That kind of thing could change at any time now that the product is live,” he says.
It’s all about more traction with local merchants
The broader idea here — as with Amazon’s other efforts in local commerce such as its Register project that includes the acquisition it made of mobile payments technology and product/team Gopago, as well as a possible peer-to-peer payments service — is for the online sales giant to get further into the business of helping local merchants.
Our source confirms what Reuters originally reported earlier this month about the services business: “Restaurants and the register product are the start, they’ll be going live with other verticals, and deeper features in the coming months.”
Which verticals? Travel is one option — following what e-commerce counterparts in other parts of the world like Ozon in Russia have been investing in, as well as Groupon. There is already a travel tab in the Amazon Local app.
Deeper features, meanwhile, could include, potentially, other services for existing verticals. So one example could be reservations for restaurants, creating a service akin to OpenTable, which has recently been acquired by Priceline for $2.6 billion.
The basic logic appears to be based on the same economies of scale on which the company has built its bigger business: when and if Amazon gets a strong enough critical mass in any one vertical, it will build it out.
This is also likely where potential drone-based delivery services would also sit, although it looks like it may take years before this idea flies (literally and figuratively).