These days mark one year after the acquisition of Whole Foods by Amazon. These are the changes that Whole Foods has undertaken according to its management.
From Business Wire:
“In just one year we’ve made significant progress bringing the combined value of Whole Foods Market and Amazon together.”
- Exclusive Prime member savings: Prime members shopping Whole Foods Market stores nationwide receive an additional 10 percent off hundreds of sale items.
- Ultrafast delivery for Prime members: Two-hour delivery on Whole Foods Market groceries through Prime Now in more than 20 cities.
- Grocery pickup for Prime members: Grocery pickup in as little as 30-minutes at select Whole Foods Market locations.
- Alexa shopping: Prime members can use Alexa to add Whole Foods Market groceries to their Prime Now cart.
- Amazon Rewards Visa Signature Cardmember savings: Cardmembers with an eligible Prime membership earn 5% Back when shopping at Whole Foods Market using the Amazon Prime Rewards Visa Card.
- Added selection: Whole Foods Market’s healthy and high-quality private label products are now available through Amazon.com. Amazon devices, such as Amazon Echo, Echo Dot, Fire TV, Kindle e-reader, Fire tablets and more, are available in more than 100 Whole Foods Market stores.
- Convenient Amazon.com package pickup: Amazon Lockers in Whole Foods Market stores allow customers to have products shipped from Amazon.com to their local store for pick up
(Press release edited, shorten for the essentials)
And just like that, the ongoing strategy from Amazon on physical is finally revealed.
- Push Amazon PRIME by any possible means, slashing prices as the incentive to do so. PRIME is a the moat Amazon is the basic tool to finance growth. Now it is a reality in the realm of physical retail too.
- Ultra-fast home delivery or click-and-pickup, combining own Amazon/ WholeFoods products with products from other shops or restaurants. Amazon has invited third party players to sell their products through its portal for years now. Now this is happening in the real world too.
- Cross-inventory in e-commerce and Physical retail. Amazon has started to distribute own electronics through Whole Foods: Echo, Kindle and Fire TV. I expect Whole Foods to showcase other products too, specially Amazon’s own private brands – Amazon Basics and Amazon Essentials
In short: One year later Amazon Whole Foods is becoming the physical one-stop-shop to cover all your needs with Amazon own products. Convenience, price and ultra-fast delivery to your door are the triumph cards to play.
Of course, this is not the whole story. Amazon is thus collecting vast amounts of data across the virtual and physical world. This will allow the giant from Seattle to make its own products even more attractive and perfectly priced.
The war on retail is global and merciless and cannot be won in isolation. In Norway, Orkla has acquired Gymgrossisten.no and thus has gained a potential direct channel to the Norwegian consumers. Komplett has now invited third party players to sell their products through the Komplett plattform.
These are all good moves, but I am not sure whether they will be bold enough. As I have expressed several times before, Norwegian retailers should focus on:
- Convenience as the true source of loyalty
- Data sharing across most retailers, brands and payment players
- International expansion through acquisitions or strategic alliances
Amazon, Walmart and others are showing us that the days of specialized retail stores (groceries, home improvement, furniture…) are counted.
The end game of retail is one-stop-shops with a combination of physical and online presence. Anything else would be too small to survive in a world ruled by giants.
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