A cashier was enthusiastic about what was to come, but didn’t know the store had already started to reduce prices by up to 43% on staples such as bananas, rotisserie chicken and avocados. The slashed prices were scattered throughout this store, not in any one place, with tasteful Whole Foods + Amazon orange signage and the promise of more to come.
Shoppers were greeted with overhead signs in the produce department.
Some were aware that Amazon had purchased Whole Foods. Others were not. Mark, who was handing out samples in the cheese department, said the store was decidedly busier than on a typical Monday. While Melissa, who was restocking baked goods, said it was hard to say if the traffic was because of Amazon or just because people were returning from their summer holidays.
On the Amazon website, meanwhile, 49 Whole Foods 365 store brand items were available for delivery. The final in-store promotional flyer for 365 is now in stores.
“Price was the largest barrier to Whole Foods’ customers,” Mark Baum, a senior vice president at the Food Marketing Institute, told Bloomberg. “Amazon has demonstrated that it is willing to invest to dominate the categories that it decides to compete in. Food retailers of all sizes need to look really hard at their pricing strategies, and maybe find some funding sources to build a war chest.”
Bloomberg, talking to an analyst atKantar Retail, predicted lower prices still won’t solve Whole Foods’ woes because it is not an everything store and convenience is an increasingly important factor.
Among the items marked down were organic avocados, organic brown eggs, organic salmon, almond butter, organic apples and organic rotisserie chicken.
Amazon Prime, which comes with a $99 annual subscription fee and a lower tier, will become the customer-rewards program for Whole Foods and offer lower prices.
Amazon lockers where customers can pick up Amazon.com purchases or send back returns will appear in select Whole Foods stores. Logistics and point-of-sale systems will also be integrated.
Relax! Amazon Will Not Crater Your Business by Jay Jacobowitz> Strategies for Natural Products Retailers to Stay Competitive by Daniel Lohman, CPSA
