Retailers ready to take on Amazon Prime

For five years, Amazon.com has persuaded shoppers to put aside their dislike of paying shipping costs by selling them on Amazon Prime – an unlimited two-day shipping service that carries a $79 annual fee.

Although Amazon doesn’t divulge details of Prime membership, analysts say the program has helped the Internet giant attract and keep millions of customers.

Now, more than a dozen retailers hope to take on Amazon Prime with a $79, two-day shipping service of their own. Called ShopRunner, it’s managed by GSI Commerce, a publicly traded, e-commerce-services provider based in Pennsylvania.

For $79 a year, ShopRunner offers unlimited, two-day shipping across a platform of participating retailers, including Toys R Us, GNC and Sports Authority. It soon will add Dick’s Sporting Goods, Barnes & Noble, Borders and Drugstore.com.

ShopRunner, which made its debut Tuesday, also promises free shipping on returns, a perk not available to members of Prime.

Fiona Dias, executive vice president of strategy and marketing at GSI Commerce, said ShopRunner expects at least 40 retailers to participate by the end of 2010. She would not reveal the details of their financial arrangements with ShopRunner.

“If you’re going to spend $79, you want a really broad assortment, and by the end of the year, we’ll have an assortment of 5 million items,” Dias said. “That’s the kind of heft you have to bring to it.”

While the overall retail sector has been hit hard by the recession, Amazon continues to put up growth numbers more in line with a booming economy. For the first six months of 2010, its profit jumped 58 percent to $505 million on sales of $13.7 billion, a 44 percent increase from the same period in 2009.

Last year, the Seattle-based retailer captured nearly 8 percent of all Internet sales in North America, according to Hudson Square Research.