Each shipment company has a version of this. With Federal Express, it’s called FedEx Home Delivery. It’s a special service that lets the shipper ship the product to you for a very small amount. Note, that doesn’t mean that they will therefore charge you less, it just means they get a break. Fortunately, most online services pass this deal on to you.
Whenever a shipper prepares to ship a package to their customer, they choose a shipper and a shipment method based on certain criteria, the largest factor being what is going to cost them the least money. The second biggest factor is the expected delivery location. If the place you’re ordering it from gives you an option to specify the shipping address as Home or Business, that tells them whether or not to use Home Delivery service or Business.
A Business class delivery service (what most people are used to at their places of business) delivers M-F during business hours, and charges extra for a Saturday delivery.
A Home class services works on the assumption that you will be at home, and not at work, to receive the shipment, and therefore delivers things differently. UPS, FedEx, and DHL all have versions of this.
One version allows them to dump everything on a local shipper, usually USPS. This greatly reduces their delivery cost - 1 delivery of 100 items is easier than 100 deliveries of 1 item each. Keep in mind most home orders will be 1 or 2 items, and work orders might be several, so delivering two books in a single box from Amazon.com is not always cost effective for UPS or FedEx.
If they can drop them all at USPS, their cost for those deliveries probably went to 10% or less. The cost for USPS to make deliveries of one or two packages per location, to places they are already delivering to, probably does not increase their cost as radically as it reduces the cost on the shipper who brought it to USPS. So that shipper pays USPS a small fraction of what their cost would have been to deliver themselves.
Another flavor of home delivery service has the shipper delivering Tues-Sat instead of Mon-Fri, and generally those hours are 10-6 instead of 8-5. They also tend to take a day or two longer than business class service to arrive, although this is not always the case.
The end result should be a cost saving for us, the customers. A recent shipment I got from Sony was free shipping, with the drawback that I had to wait over a weekend (until Tuesday) to get it. Would I have paid an extra $3 to get it before the weekend? Sure. Would I have paid an extra $15 or $20? No way.