Amid the holiday season and the busiest time of its year,
On Tuesday, the company quietly unveiled a website for Amazon Local Services, a marketplace for consumers to book service professionals like auto mechanics and handymen online. Reuters and the Wall Street Journal had previously reported that the company was experimenting with the services category, but the Amazon web page located by FORBES, shows the extent of the Seattle online retailers' venture into a market that totals more than $400 billion in annual business.
Billed as a "new way to shop for services," Amazon Local Services allows users to find professionals, like a computer repairman, online, recommending nearby service providers based on a customer's zip code. If there is a nearby professional for a given task, customers are then able to peruse prices, schedule a time with the provider and pay through Amazon once the job is completed.
"Amazon Local Services is a new and simple way to buy professional services from pros such as plumbers, auto mechanics and yoga instructors," said a promotional video on the site. "We've handpicked some of the best pros in your neighborhood and require them all to be licensed, insured and background-checked."
An Amazon spokesperson declined to comment on the new business.
In the local services space, Amazon faces a bevy of competitors from well-financed startups like San Francisco-based Thumbtack to big box stores like
The Amazon web page uncovered on Tuesday showed a wide-range of offered services, though most were focused on the installation of physical wares like security cameras, auto parts and garage doors. Tasks were divided into four categories on the site: home repair, automotive, "lawn & garden" and "computer & electronics."
Despite its potential, Amazon Local Services is still in its early days. Its website featured repetitive stock photos for different services, while some zip codes--even those in New York, Seattle and Los Angeles--did not have professionals for certain tasks. There were few instances where a zip code had multiple service professional options for the same job.
Thumbtack CEO Marco Zappacosta, whose company raised $100 million in August, said Amazon's offering is what his company had been expecting. It makes sense for them to offer services side-by-side with physical products that they sell, admitted Zappacosta, though he noted that it might be hard for the company to group certain tasks into easy product and pricing categories or SKUs.
"They're shoehorning local services into the same way they treat other [physical] products with SKUs and checking out... but the SKU format may be potentially impossible for services," he said. "There are things like installing a window and that's certainly a SKU. But what about building a deck? Your deck is going to be different than my deck and your backyard is going to be different than my backyard."
While Amazon's site said that services are backed by their happiness guarantee, it's not clear if the pricing seen on its website for tasks is final. The explanatory video for the program noted that "final pricing" was confirmed in-person between a customer and professional, leaving potential wiggle room for the quotes seen online and actual amounts paid for finished jobs. A website detailing the agreement between Amazon and professionals revealed that the e-commerce giant takes a 20% cut for services priced up to $1,000 and 15% for everything that exceeds that amount.
As Amazon dabbles in other ventures like a rumored travel site and an ad-supported video-streaming site, local services is yet another battlefront in its quest for online commerce domination. The company is looking to loop in service professional in Florida, Texas and other sites, according to its website, and will likely expand into other categories beyond product installations like sports coaches and music teachers.
"Their dream is to be the 'Everything Store' and this is a step in that direction, but they have a long way to go to deal with the immense breadth and demands that exists," said Zappacosta.
