Since Amazon’s acquisition of Whole Foods last year, the public has been anticipating Prime member benefits for the organic grocery chain. After purchasing Whole Foods, Amazon began cutting prices almost immediately, and has offered one-off discounts to Prime subscribers, such as price-slashed Thanksgiving turkeys last November. As of this morning, a formal Prime member program for Whole Foods has been announced.
Starting this week in Florida, “members get an additional 10 percent off sale items, typically hundreds of products throughout the store, plus weekly deep discounts on select best-selling items.” The program will expand to the rest of the US this summer.
While a 10% additional discount is appealing, Prime members may find greater value in weekly deals. According to the Whole Foods press release, this week’s deals include:
- Sustainably-sourced, wild-caught halibut steaks: $9.99/lb., save $10/lb.
- Organic strawberries: 1 lb. for $2.99, save $2
- Cold brew coffee at Allegro coffee bars: 50% off 16 oz.
- KIND granola: 11 oz. bag 2/$6
- 365 Everyday Value sparkling water: 12-pack case buy one, get one free
- Magic Mushroom Powder: 50% off
- Plus, an additional 10% off hundreds of sale items throughout the store
Following a series of brick-and-mortar investments, this announcement makes perfect sense for Amazon. That being said, some questions are raised regarding Amazon customers. Does a half-priced cold brew coffee justify the Prime price increase? Will consumers who typically shop elsewhere switch to Whole Foods because of these discounts? Will Whole Foods offer similarly attractive discounts in the future, or are they simply showing an impressive hand for the announcement?
The distance between physical and digital commerce is continuing to blur. Prime membership benefits may result in higher Whole Foods foot traffic, causing brands available in Whole Foods to have higher visibility, and as a result, gain new customers both offline and online — 58% of shoppers check their phones for product information while shopping in-store, and 54% use mobile devices to price-compare. Additionally, as seen with Amazon Go, Amazon uses data from their offline offerings to benefit their online offerings and vice versa. As Amazon increases the value of Whole Foods for shoppers, the importance of an Amazon brand strategy only becomes more pronounced.
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