Presumably they have good knowledge of the distribution of consumer behavior and have figured out how to make money in aggregate, despite the presence of people like me. I agree with Manjoo though, at times it's hard to believe.
Your local safeway had to have that deodorant shipped at some point, too.
Then they had a shop clerk unbox it, put a label on it, place it on a shelf, eventually drag it over a scanner and (in america) put it in a nice brown paper bag for you.
The brown paper bag, the scanner, the shelf, the label, the clerk, and no least the brick & mortar store surrounding all that costs Safeway significant amounts of money - in addition to the truck that initially shipped the deodorant.
Amazon pays only the truck.
2) Overnight shipping is cheap if the distance is short, because then it's really just "shipping a short distance, which happens to be during the night".
3) You still have to pay shipping at Safeway, and you also have to pay for Safeway's smaller economy-of-scale inventory system.
4) Amazon wants you to love shopping with them, and they play the long game. They'll take a loss on deodorant to win a customer.
Also, I accidentally learned that pressing ~ twice while focused on a SlideShare presentation gives you their dev log. http://i.imgur.com/e2rBO.png