Amazon Wants to Ship Your Package Before You Buy It

January 17 -- Amazon.com knows you so well it wants to ship your next package before you order it.

The Seattle retailer in December gained a patent for what it calls “anticipatory shipping,” a method to start delivering packages even before customers click “buy.”

The technique could cut delivery time and discourage consumers from visiting physical stores. In the patent document, Amazon says delays between ordering and receiving purchases “may dissuade customers from buying items from online merchants.”

So Amazon says it may box and ship products it expects customers in a specific area will want – based on previous orders and other factors — but haven’t yet ordered. According to the patent, the packages could wait at the shippers’ hubs or on trucks until an order arrives.

In deciding what to ship, Amazon said it may consider previous orders, product searches, wish lists, shopping-cart contents, returns and even how long an Internet user’s cursor hovers over an item.

Today, Amazon receives an order, then labels packages with addresses at its warehouses and loads them onto waiting UPS, USPS or other trucks, which may take them directly to customers’ homes or load them onto other trucks for final delivery.

It has been working to cut delivery times, expanding its warehouse network to begin overnight and same-day deliveries. Last year, Amazon said it is working on unmanned flying vehicles that could take small packages to homes directly from its warehouses.

In the patent, Amazon does not estimate how much the technique will reduce delivery times.

The patent exemplifies a growing trend among technology and consumer firms to anticipate consumers’ needs, even before consumers do. Today, there are refrigerators that can tell when it’s time to buy more milk, smart televisions that predict which shows to record and Google’s Now software, which aims to predict users’ daily scheduling needs.

It’s not clear if Amazon has deployed or will deploy the technique. A spokeswoman declined to comment.

But the patent demonstrates one way Amazon hopes to leverage its vast trove of customer data to edge out rivals.

“It appears Amazon is taking advantage of their copious data,” said Sucharita Mulpuru, a Forrester Research analyst. “Based on all the things they know about their customers they could predict demand based on a variety of factors.”

According to the patent, Amazon may fill out partial street addresses or zip codes to get items closer to where customers need them, and later complete the label in transit, the company said. For large apartment buildings, “a package without addressee information may be speculatively shipped to a physical address … having a number of tenants,” Amazon said in the patent.

Amazon said the predictive shipping method might work particularly well for a popular book or other items that customers want on the day they are released. As well, Amazon might suggest items already in transit to customers using its website to ensure they are delivered, according to the patent.

Of course, Amazon’s algorithms might sometimes err, prompting costly returns. To minimize those costs, Amazon said it might consider giving customers discounts, or convert the unwanted delivery into a gift. “Delivering the package to the given customer as a promotional gift may be used to build goodwill,” the patent said.

Greg Bensinger       www.blogs.wsj.com