Whole Foods has announced it is launching new discounts for Amazon Prime members.
The new discounts include 10% off sale items and heavier discounts on a rotating selection of weekly goods.
The new discounts could be a way for Whole Foods to go after both low- and high-income customers at the same time as the middle class continues to shrink.
Amazon’s new discounts at Whole Foods are about more than getting $10 off halibut steaks.
It means Amazon is continuing to infiltrate the grocery space like never before — and it’s just the tip of the iceberg.
While Amazon immediately lowered prices at Whole Foods after the deal to buy the grocery chain closed at $13.7 billion, that was just a hint of what was to come. Now that Amazon has firmly entrenched itself in Whole Foods, it can more wholly start the process of converting Whole Foods into what it ultimately aims for it to be.
The discounts may bring in shoppers from across the income spectrum, which Perrier notes Whole Foods must do to compete with the entrance of low-cost competitors to the grocery market.
“It’s no coincidence that the market dynamics we’re witnessing are happening at the same time as the hollowing out of the middle-class,” Sylvain Perrier, president and CEO of Mercatus, told Business Insider in an email.
Perrier continued: “Now with Amazon, and new entrants on the low-end like the Aldi’s and Lidl’s, along with Dollar General investing in grocery, the pressure for a share [of] a shrinking middle-class pie will get much tougher. What options do traditional grocers have but to reinvent where they play and how they do business?”
At the same time, the fact that the discounts are being tied to Prime is no accident. Prime is Amazon’s major growth vehicle, GBH Insights analyst Daniel …read more
Source:: Business Insider