The Amazon-ization of everything may not be so bad after all. The company announced on Thursday that it would cut prices at Whole Foods starting Monday:
Amazon’s $13.7 billion purchase of Whole Foods Market will be finalized Monday, and shoppers will see an immediate markdown in prices on a number of items, including salmon, avocados, baby kale and almond butter, as the tech giant looks to shake up the grocery business.
Amazon and Whole Foods announced the news on Thursday.
“The two companies will together pursue the vision of making Whole Foods Market’s high-quality, natural and organic food affordable for everyone,” they said in a joint statement. “Whole Foods Market will offer lower prices starting Monday on a selection of best-selling grocery staples across its stores, with more to come.”
We know, we know… nobody ever admits to shopping at Whole Foods, yet it’s always difficult to find parking at one.
In the past several months, I’ve been avoiding Los Angeles traffic by having Amazon bring my groceries to me via Amazon Fresh or Amazon Prime Now. My daughter and I are also frequent Whole Foods shoppers, so I am very interested in seeing how Amazon utilizes this acquisition.
The article says that in-store specials will be offered to Amazon Prime members and there will be some immediate changes for frequent Amazon shoppers:
For Seattle-based Amazon, the addition of Whole Foods means laying claim to more than 460 physical locations and an inroad into the competitive $600 billion grocery industry. The company will add Whole Foods’ private label products — including 365 Everyday Value, Whole Paws and Whole Catch — to Amazon.com, AmazonFresh and Prime Pantry. Some Whole Foods stores will also begin adding Amazon Lockers, where customers can pick up online orders or drop off returns.
CNBC reports that Whole Foods could take care of “Amazon Prime’s biggest headache”:
Despite its massive success, Amazon Prime hasn’t been able to solve one nagging problem: its heavy concentration in high-income households.
But Amazon’s decision to lower prices at Whole Foods could help draw more lower and middle income people to its Prime program, as they will feel more compelled to check out the grocery store — and ultimately find out about the many benefits of the Prime program.
“Amazon’s trying to cast as wide a net as possible,” R.W Baird’s analyst Colin Sebastian told CNBC. “They’re going to try to make more store shoppers Prime members, and then bring more Prime members into stores.”
All good news for everyone who has already bought into the Prime experience.