Amazon wants Prime members to do more of their grocery shopping at Whole Foods:
Amazon bought Whole Foods in 2017 for nearly $14 billion to gain entry into the $860 billion US grocery industry. Amazon hoped the deal would help it convert Whole Foods’ shoppers into Prime members.
The retailer also set its sights on an even bigger opportunity: Convincing more of its approximately 100 million Prime members in the United States to buy their groceries at Whole Foods.
Amazon has tried to make Whole Foods more attractive to Prime members since the acquisition. Amazon initially cut prices on products like salmon and avocados. Then it began offering an extra discount on sale items exclusively for Prime shoppers last year to sweeten the Whole Foods offer.
Despite those steps, most Prime members still avoid shopping at the organic grocery chain. Only about 18% of Prime members shop at Whole Foods at least once per month and 70% of Prime members say they rarely or never shop at Whole Foods, according to a recent survey by Wolfe Research.
Is this going to work? Probably not. Here’s why:
Whole Foods isn’t convenient for most shoppers. I live in suburban Cincinnati, and there is one Whole Foods within driving distance of my house (and it’s not in a convenient location). On the other hand, Walmart, Meijer, Kroger, and Jungle Jim’s (a local, Cincinnati-based chain) are all within four miles of my front door.
Whole Foods is expensive. Amazon has made efforts to make Whole Foods cheaper. But there’s considerable debate about the success of those efforts.
Whole Foods has always been something of a hoity-toity affair, a shopping destination for wealthy singles, and a few helicopter parents who don’t want their precious Tiffanies and Connors and Alexanders to consume any pesticides.
Whole Foods will always have a following in the big cities. But out here in redneck country? Hell no, we’re going to Walmart.
What about Amazon Fresh? Amazon is also marketing a grocery delivery service. I’m not sure if this is connected to Whole Foods.
I like having books delivered to my house. The mail carrier invariably crams the oversized package into my mailbox, thereby damaging the book, and presenting me with the challenge of prying it out. Nevertheless, where books are concerned, the convenience of home delivery outweighs the headaches.
But as for groceries? No…not so much. I like to pick out my own fresh produce, in particular. And I can only imagine what the slipshod delivery methods of the US Postal Service would do to a dozen apples and some bananas. There wouldn’t be an undamaged piece of fruit in the entire delivery.
In short, I am generally a fan of Amazon. But I’ve always felt that Whole Foods was little more than a novelty. Home delivery service for groceries, meanwhile, is mostly a solution in search of a problem.
Yes, the Internet is wonderful. But some things really are better done the old-fashioned way. Grocery shopping is one of those things.