Uber’s new package delivery service is expanding with some big-name partners like Nordstrom, SAP, T-Mobile, and perhaps most notably, Google.
The ride-hailing giant today announced that it is moving beyond helping smaller brick-and-mortar retailers deliver packages and is now working with larger businesses that need help moving product from one place to another.
UberRUSH builds off the infrastructure and hundreds of thousands of drivers Uber has for its transportation service. The program was piloted in New York City and expanded to San Francisco and Chicago this past October. There are more than 1,000 clients using UberRUSH.
Uber will now share a private UberRUSH API with its partners, who can then implement a delivery option for their customers in those three cities. For example, as you can seen in the screenshot above, Nordstrom will offer customers an option for same-day delivery via UberRUSH.
Since 2011, Nordstrom has actually offered a $15 same-day delivery service in four markets — including Chicago and Seattle — and began testing curbside pickups last year. But this new UberRUSH integration gives the company access to customers in other cities.
Other UberRUSH retail partners include 1-800-Flowers and Rent The Runway, which offers on-demand outfits.
Google Express meets UberRUSH
One of the more surprising new partners is Google, which already has its own delivery service called Google Express. Now, the company will utilize Uber’s technology and drivers for Google Express.
A Google spokesperson confirmed that Uber will provide delivery services via its UberRUSH API, but Google will still handle merchant integration, mobile shopping apps, pricing, assortment, sorting, and other related features with Google Express.
Since Google launched Google Express in 2013 as it looked to compete with Amazon and other companies offering delivery of products purchased online, the company has always outsourced its deliveries to on-demand services like Deliv and dedicated couriers.
Google Express’ same-day delivery is now available in seven metro areas, with annual memberships priced at $95. This past August, Google shut down two delivery hubs in the Bay Area. It also began testing grocery delivery this past September, putting it in direct competition with AmazonFresh.
Other partners and competition
Another big-name partner is SAP, which will use the UberRUSH delivery service to help move products within its distribution network. Similar partners include Bergen Logistics and Trade Global.
T-Mobile will let customers buy new products like smartphones and have them delivered on the same day. It’s a similar program to Sprint’s Direct 2 You service, which creates a Sprint store experience from wherever a customer happens to be — at the office, at home, at a restaurant, etc.
Curbside, which lets people buy products online at stores like CVS or Target and be notified when their order is ready for pick-up, is also using the UberRUSH API. This makes it possible for the company to offer delivery, too, in addition to in-store pick-ups.
Customers will be able to see UberRUSH as a delivery option with the normal Uber app, or embedded on the website or app of these various retail partners — in some cases, like with SAP, the customer may never know Uber was part of the delivery process. Customers will also be able to track their package in real-time and see who’s delivering the item, much like Uber’s ride-hailing technology.
As far as delivery costs, Uber’s partners will pay Uber a small fee for each transaction that is calculated based on a variety of factors, including distance traveled. The merchant can then decide to pass the extra cost off to the customer or absorb it themselves.
In the three cities where UberRUSH is available, delivery costs range from $5-to-$6 for a base fee, and then from $2.50-to-$3 per extra mile.
UberRUSH drivers, meanwhile, go through the same background checks and other application process required of normal Uber drivers. Uber said that UberRUSH gives drivers another way to make income if they prefer to deliver packages versus people. The company also employs bicycle couriers in New York City for UberRUSH deliveries.
There are a bevy of other companies competing to deliver items to your door within hours. Amazon is certainly one of them, as the Seattle retailer offers its one-hour Prime Now delivery service in 16 markets — Prime Now requires a $99 annual Prime membership — and launched a new Prime Now restaurant delivery service late last year. Amazon is also rolling out a program called Amazon Flex that uses everyday drivers to deliver Amazon packages in their own cars.
Other competitors include Postmates — which has delivery partnerships with Starbucks and Chipotle — Deliv, and local couriers.
Similar to Sidecar
Before it shut down this past December and was acquired by GM, Sidecar found success with its delivery service after shifting its business from ride-hailing to package delivery. This past August, the company said it had the largest B2B on-demand delivery network in the U.S.
In May, Sidecar CEO Sunil Paul told GeekWire that there would be “room for lots of winners” in the on-demand delivery economy, and that not every business would want to work with a company like Uber:
“First of all, the on-demand economy is growing very rapidly. There will be room for lots of winners. One of the biggest reasons for that is when you sell to a business, they don’t want a monopoly in their supply chain. Meanwhile, for consumers, the idea that Uber has 90 percent market share doesn’t bother them. But if you are a business, that’s not an acceptable state of affairs. It’s not uncommon for a business to ask for overnight service and give 60 percent of business to FedEx and 40 percent to UPS.
The other dynamic at work here is that Uber, since it has so much capital and is so big and so powerful, it threatens the business of lots of companies — especially those that want to have a relationship with the consumer around on-demand delivery. Uber has made it very clear that they want to deliver things to consumer. They are clearly intent on owning consumers for those relationships.
The bottom line is that people don’t trust Uber, and that certainly goes for businesses.”
Earlier this month, Paul cited Uber’s “limitless capital” and the company’s willingness to “win at any cost” as reasons for why Sidecar shut down.
Sidecar, which introduced several innovations that Uber would later implement, also said it was working to solve the “first yard.” In August, Paul noted that while the company was already solving the “last mile” of delivery for merchants — the final transport before a package reaches your doorstep — it wanted to make the process “from where the product is made to its first mode of transportation” more efficient.
That seems to be a target of Uber, given its new UberRUSH partnerships with companies like SAP and Bergen Logistics.
Though Uber’s revenue primarily comes from transporting people around cities, the company is clearly looking to expand into other verticals with its technology infrastructure now in place. It is rolling out its UberEATS food delivery platform around the country and tested a drug store delivery service in 2014.
