Lower Prices Part of Amazon's Plans for Whole Foods

Saturday, 26 Aug, 2017

The $13.7 billion acquisition, announced in June, will close on Monday, Amazon and Whole Foods said in a joint statement one day after Whole Foods shareholders backed the deal and United States antitrust officials gave it the green light. On Thursday, Amazon announced that Amazon Prime will become Whole Foods' customer rewards program, giving Prime members "special savings and in-store benefits".

Other integrations include the availability of 365 Everyday Value, Whole Foods Market, Whole Paws and Whole Catch private label products for sales through all of Amazon's programs.

Now that Amazon has access to Whole Food stores, and it's planning to sell these products at lower prices, these chains will have more competition. About 63% of Amazon customers in the USA have Prime and they spend $1,300 a year on goods from the retailer, compared with $700 for non-members, CIRP estimates.

Of course, with Amazon Prime in the Whole Foods Market physical locations allows the online giant to track customer data to suggest other purchases.

"We're determined to make healthy and organic food affordable for everyone", Jeff Wilke, CEO of Amazon Worldwide Consumer, wrote in the release. "We can't wait to start showing customers what's possible when Whole Foods Market and Amazon innovate together".

"Everyone thinks the sky is going to fall Monday because Whole Foods is lowering its prices on milk and eggs", said Michelle Grant, head of retailing at Euromonitor International, a London-based market research firm.

"Grocery has always been the achilles heel for Amazon", Grant said.

Discounts are not the only reason shoppers use Amazon - selection and convenience are others - but Bezos has never been shy about starting price wars that inflict pain on rivals.

The Whole Foods Market brand will likewise be maintained.

Amazon will be offering Amazon Lockers in select Whole Foods Market stores.

A major boon: 90% of Amazon Prime subscribers live within 10 miles (16 km) of a Whole Foods store. They purchase from Amazon 25 times a year on average, 11 more visits than non-Prime customers.

The announcement that Amazon will reduce prices on grocery staples at Whole Foods signals a clear intention to remedy what has been one of the grocery chain's biggest weaknesses. This way, everyone is assured of getting the finest natural and organic foods. continue their The company's relation with trusted vendors and partners around the world will also continue. SuperValu, with a network of 2,000 stores across the country, was down more than 6 percent, while Costco dipped about 5 percent.