Amazon Doesn’t Consider the Race of Its Customers. Should It?

David Ingold and Spencer Soper, Bloomberg, April 21, 2016

For residents of minority urban neighborhoods, access to Amazon.com’s vast array of products–from Dawn dish soap and Huggies diapers to Samsung flatscreen TVs–can be a godsend. Unlike whiter ZIP codes, these parts of town often lack well-stocked stores and quality supermarkets. White areas get organic grocers and designer boutiques. Black ones get minimarts and dollar stores. People in neighborhoods that retailers avoid must travel farther and sometimes pay more to obtain household necessities. “I don’t have a car, so I love to have stuff delivered,” says Tamara Rasberry, a human resources professional in Washington, D.C., who spends about $2,000 a year on Amazon Prime, the online retailer’s premium service that guarantees two-day delivery of tens of millions of items (along with digital music, e-books, streaming movies, and TV shows) for a yearly $99 membership fee. Rasberry, whose neighborhood of Congress Heights is more than 90 percent black, says shopping on Amazon lets her bypass the poor selection and high prices of nearby shops.

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Yet as Amazon rolls out its upgrade to the Prime service, Prime Free Same-Day Delivery, that promise is proving harder to deliver on. The ambitious goal of Prime Free Same-Day is to eliminate one of the last advantages local retailers have over the e-commerce giant: instant gratification. In cities where the service is available, Amazon offers Prime members same-day delivery of more than a million products for no extra fee on orders over $35. Eleven months after it started, the service includes 27 metropolitan areas. In most of them, it provides broad coverage within the city limits. Take Amazon’s home town of Seattle, where every ZIP code within the city limits is eligible for same-day delivery and coverage extends well into the surrounding suburbs.

In six major same-day delivery cities, however, the service area excludes predominantly black ZIP codes to varying degrees, according to a Bloomberg analysis that compared Amazon same-day delivery areas with U.S. Census Bureau data.

In Atlanta, Chicago, Dallas, and Washington, cities still struggling to overcome generations of racial segregation and economic inequality, black citizens are about half as likely to live in neighborhoods with access to Amazon same-day delivery as white residents.

The disparity in two other big cities is significant, too. In New York City, same-day delivery is available throughout Manhattan, Staten Island, and Brooklyn, but not in the Bronx and some majority-black neighborhoods in Queens. In some cities, Amazon same-day delivery extends many miles into the surrounding suburbs but isn’t available in some ZIP codes within the city limits.

The most striking gap in Amazon’s same-day service is in Boston, where three ZIP codes encompassing the primarily black neighborhood of Roxbury are excluded from same-day service, while the neighborhoods that surround it on all sides are eligible. {snip}

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