Insights

Weekend Wrap-up — Whole Foods vs. Trader Joe's, Amazon’s Holiday Plans, and More

Weekend-Wrapup-8-27

Whole Foods takes traffic from Trader Joe’s

According to an analysis conducted by Sense360, Whole Foods Market has been taking customers from Trader Joes since the Amazon acquisition, particularly in areas where the two competing grocers are within one mile of each other. Customers are more likely to visit Whole Foods if they are a Prime member — in fact, “1 in 3 Prime members said they are likely to increase visitation to Whole Foods” following the rollout of Prime member benefits. Since the addition of discounts for Prime shoppers, Whole Foods has reportedly increased market penetration by about 10%.

Over half of Prime members have Alexa

According to results from Business Insider Intelligence’s Smart Speaker survey, an incredible 60% of Prime members have an Amazon-branded smart speaker, while 30% of Amazon’s non-Prime shoppers own one. As we’ve seen, Prime Members across the board have been shown to spend nearly twice as much as non-members. And, the deeper a customer is integrated into Amazon’s ecosystem, the more they end up spending on the marketplace — Echo owners spend $400 more than Prime members per year on average.

Amazon’s goal is not to sell as many Echo devices as possible, but rather to extend the reach of Alexa far and wide. We’ve seen the retailer make moves to help push the needle on their “Alexa everywhere” vision in a multitude of ways, including providing university dorm rooms with Echo Dots, having Alexa-powered smart homes, and developing an Echo for children. Amazon is likely using Alexa as a funnel to gain Prime subscribers from a growing variety of demographics, and as a result, benefit from more sales, more data, and more customer loyalty.

Amazon grows in Brazil

According to a report by Zacks Equity Research, Amazon is reportedly looking to push clothing, accessories, and footwear sales on the Brazilian Amazon marketplace. While Amazon has had a heavy emphasis on private label products in the U.S., the retailer seems to be responding to consumer preferences by focusing on major fashion brands such as Reinaldo Lourenco’s collection, Havaianas flip flops, and Levi’s Jeans in Brazil. Amazon.com.br launched in in 2012.

Holiday preview emphasizes Amazon’s private label focus

Amazon recently hosted a holiday preview pop-up in New York City, featuring the retailer’s current selection of product promotions for the upcoming holiday season. According to Forbes, the pop-up promoted Amazon’s line of hardware products, such as Echo devices, as well as a heavy emphasis on the retailer’s private label offerings, particularly in the clothing and apparel category. The pop-up’s kitchen area was decorated with Amazon’s private label home and kitchen products as well, including snacks, soaps, and dog food. The same was true in its furniture section.

As we’ve seen repeatedly over the past few years, Amazon’s emphasis on white label products is continuing to grow. In order to keep up, established brands should have a dedicated Amazon strategy, taking control of their content, customer experience, and digital marketing efforts as much as possible. To get ahead, brands need things that private labels might not have — a superior brand story, an outstanding product, and a dedicated customer base. Amazon currently offers over 70 private label brands.