For traditional grocery retailers, there is both good and bad news in Amazon’s acquisition of Whole Foods. The good news is that even Amazon is acknowledging that physical stores have a key role to play in the selling and distribution of fresh food and other household staples. The analogy of iTunes is to CDs as Amazon is to fresh food turns out to be false – it doesn’t necessarily represent end times for an industry. That said, the bad news is that traditional grocery retailers have a new competitor named Amazon…and they’re a damn formidable force to be reckoned with.
The "Fight of the Century” occurred Saturday night in Las Vegas. Floyd Mayweather, the professional boxer, won by TKO over Connor McGregor, a UFC champion, in the 10th round. The pair fought under traditional boxing rules which made it tough on the octagon cage fighter McGregor, who was used to a street brawl, not traditional boxing.
On Monday the retail industry caught yet another glimpse into the world of Amazon, as they closed their acquisition of Whole Foods and simultaneously rolled out significant price cuts at the grocer. In true Amazon style, the cuts were deep and wide, applying not just to niche items but also pantry staples and key trip-drivers that entice consumers into the store. Just as they have done online for years, Amazon has now further lowered the limbo stick on pricing yet another notch, and is challenging the rest of the retail industry to lean back and try to make it under without collapsing.
With Amazon set to cut prices at Whole Foods starting today, the entire grocery retail industry is bracing for impact (if not already feeling the heat). There is no shortage of speculation on what this move means for grocery stores. Will grocers be able to compete with the price and quality combination offered at Whole Foods’ stores post-acquisition? How quickly will Whole Foods assortment be available for purchase online at Amazon? How will Amazon transform today’s grocery fulfillment models?
For those of us who thought Amazon moved fast by introducing Amazon Prime approximately two months after settling on the idea, that's positively horse and buggy compared to getting FTC and shareholder approval for the Whole Foods acquisition and dropping prices in what will turn out to be less than a week. And for those of you lulled into believing Amazon was going to go slow, surprise, you're competing with Amazon starting now.
On July 11th, a new online-only private label consumer goods retailer, Brandless, opened up its web shop, adding another competitor in the battle against traditional brick-and-mortar business while also challenging national CPG brands.
For the first time, Kroger will offer its own home grocery deliver service in the test market of Cincinnati. The Cincinnati Business Courier reports that the pilot program is being offered through a partnership with the Grocery Runners service.
Consumers have grown accustomed to advertisers taking advantage of key events on the calendar like the Super Bowl or the holiday shopping season to ramp up their ad messaging. This week afforded advertisers a potential once-in-a-lifetime advertising opportunity in the form of a solar eclipse. Today, all of North America will be treated to either a full or partial solar eclipse, depending on where you live. With all of the excitement in the news and on social media about the rare event, brands and retailers are bringing the timely topic to their customers.