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Amazon + Whole Foods: “Alexa: More $8 Ice Cream! NOW!”

3 MINUTE READ | June 19, 2017

Amazon + Whole Foods: “Alexa: More $8 Ice Cream! NOW!”

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John Weyand, VP, Consulting

John Weyand has written this article. More details coming soon.

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The ramifications of Amazon’s $13 billion purchase of Whole Foods could fill a shopping cart (yep, I did)–just for starters, they include an immediate brick-and-mortar play for the world’s biggest e-commerce player, a nationwide rollout of its Amazon Go concept (and the consequent threat to a majority of the current Whole Foods workforce), and even faster and more broadly-assorted grocery delivery in the affluent locales Whole Foods locations typically occupy than is offered by Amazon’s current grocery delivery service, Amazon Fresh. Rather than talking broad strokes though, let’s make like Amazon and get personalized with all this. Let’s talk about me.

I’ve been a grocery shopper through several stores and services—as a Coloradan/Texan, I’ve taken my share of trips to Tom Thumb/Randall’s, King Soopers/Kroger, and the oft-swooned-over HEB/Central Market (for pure grocery store bragging, it’s the Publix of Texas). As a New Yorker, FreshDirect was a revelation for someone who actively dislikes grocery shopping but loves good fish and produce, and trying for similar convenience through the pairing of a service like Instacart with the brick-and-mortars was an unmitigated failure.

Then there’s Amazon Fresh. As a new customer, I saw a lot of promise even before the big acquisition. Competitive pricing? Unlimited monthly delivery for a flat fee? Duplicating last week’s order with one click? Customer reviews of a particular size of onion? Back in Texas, these aren’t just positives; they’re differentiators.

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What’s missing in Amazon Fresh from my weekly Central Market runs, however, is one key piece, which I’ll choose to call “Semi-prepared for the Cooking Impaired,” or SPCI. Here’s an example: I could probably figure out or look up a salmon marinade, but do I want to when there’s a freshly packed, beautiful filet just sitting there with the marinade already on it, ready for me to buy? It’s probably not impossible to craft some burger patties with little bits of bacon, cheese, and jalapeno in them, but what am I, a wizard?

To the matter at hand, Whole Foods doesn’t have this piece figured out to the extent that Central Market does, but it goes a long way toward filling the big hole in Amazon Fresh’s assortment that exists between packaged/processed food and ingredients in their most basic form. For me to successfully create the illusion that I’m competent in the kitchen, getting some SPCI in there is critical. Plus, as I’ve seen it so far, Amazon needs about 12 hours to get my order together and deliver; if a timeline more along the lines of Amazon Prime Now takes hold because of the Whole Foods that’s ten minutes away, I’ll be barking at Alexa that I need dessert between bites of dinner. And let’s not even get started on the data implications and product recommendations. There is no greater upsell category for pure conversion than food. “Would you like fries with that?” ‘Nuff said.

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As with all things Amazon, it’s gonna be tough for other players to compete. Out-innovating Bezos and Co. is a tall order; the focus instead needs to be on keeping pace with the evolving customer experience but winning by difference (Central Market, keep expanding that SPCI selection, won’t you?). The difference, after all, is what got Whole Foods to this point… which you can hear a full dissertation on from any of its cashiers, fully unsolicited.

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