Amazon Plans Local Services Marketplace This Year, Sources Say
Reuters / Michaela Rehle
Amazon later this year plans to launch a marketplace for local services, a broad term that encompasses anything from babysitters to handymen, several people familiar with the matter said.
Amazon plans to start in one market to test demand and logistics before rolling it out nationwide, mirroring its approach to its grocery delivery service, Amazon Fresh. Fresh was tested in Seattle for years before expanding to San Francisco and Los Angeles last year.
The move takes direct aim at consumer review sites Yelp and Angie’s List as well as U.S. home improvement chains Home Depot and Lowe’s Companies, which have both invested in ways to connect customers with local plumbers, painters and other service providers.
Amazon declined to comment.
In recent months, Amazon has reached out directly to service providers as well as to several startups in Seattle and San Francisco that already connect service providers to customers through their own web sites and mobile applications, the sources said.
At least one of the startups contacted by Amazon focuses on home repair. Others offer a broader range of services that include massages and haircuts.
The company has been experimenting with ways to tie services to the products it sells. In one example, Amazon recently ran a test on its website offering installation services to users who bought Nest thermostats.
A local services marketplace would extend Amazon’s profitable role as a middleman for third-party vendors, which account for about 40 percent of Amazon’s sales.
The quality of the local services would be backed by Amazon’s “A-to-z Guarantee” which the company uses to vouch for items sold by third-party sellers on its website.
Offering local services on Amazon’s website has been a goal of Chief Executive Jeff Bezos for years. Bezos personally invested in Pro.com, a Seattle-based startup, founded by former Amazon executives, which helps customers find contractors, book appointments and estimate the cost of home repair and improvement projects.
(Editing by Peter Henderson)